A recruitment agency is offering supermarket-style incentives and “air miles” in an attempt to get schools and teachers to sign up with them.

Recruit PLC is offering London-based teachers “air miles” - which can be collected to get free flights - along with a daily rate of between Pounds 75 and Pounds 80. It is also offering schools in Bristol a Pounds 10 discount voucher to reduce the cost of hiring a teacher.

The use of marketing strategies is the latest development in the growing battle between private recruitment agencies, which is set to intensify further as a result of last week’s High Court victory by the biggest private agency, TimePlan Education Group Ltd, over the right to determine its own pay rates to the teachers it employs.

Jim Slaymaker, director of Recruit PLC which has branches nationwide, claimed teacher pay was unaffected saying: “It comes out of our profit margin.” The company is giving the discount vouchers as a one-off offer for the summer term only. “We have posted them to all the schools in Bristol. We may do it again next year if it works,” he said.

Teacher recruitment agencies could be forced into a damaging cost-cutting battle for business following the National Union of Teachers’ failed attempt to convince a High Court judge that TimePlan must pay supply teachers according to national pay rates.

The agency recruits largely Australian and New Zealand teachers on competitve pay rates and now proposes a nationwide expansion following its victory - sparking concern among teacher unions and rival agencies alike.

In the wake of last week’s crucial ruling by Mr Justice Evans Lombe that supply teachers placed in schools by consultancies were not employed by local authorities - and therefore not subject to nationally agreed pay and conditions - agencies are bracing themselves for increased rivalry and use of financial incentives within the sector where many qualified staff earn less than their local authority counterparts.

TimePlan’s Tish Seabourne, denied her agency underpaid teachers, whether newly qualifed or from overseas claiming 85 per cent received higher salaries than they would on the national scale.

She said: “If the agency is seen to be the employer it is the simplest way for teachers and schools. We have some teachers who work in 20 different schools in the course of a month, the tax system only allows for one employer after which the employee is subject to emergency tax - it would be an administrative nightmare.

“If the union had been successful it would have been a disaster for schools. We think there must be about 1,000 agency teachers in London schools, we have about 600 alone. It could have affected up to 30,000 pupils.”

She dismissed claims that the profession was becoming increasingly casualised which hindered career progression.

Despite its High Court defeat Graham Clayton, the NUT’s senior solicitor, pledged the union would fight on and was considering the possibility of appealing.

He said the union was extremely concerned that the expansion of the commercial agency market would lead to cost-cutting and a worsening of conditions and pay for teachers: “Whatever TimePlan say, the fact is school budgets are being used to pay the agencies a higher sum than the teachers are receiving in their pockets on the basis that they are qualified teachers.”

The prospect of agencies driving down costs either through financial incentives or cutting daily rates to attract business from schools struggling to balance their budgets has dismayed many within the sector.

Bob Wicks, divisional director of Select Education, which has eight branches nationwide, cited a common view: “We do not need this type of incentive, it brings the cost down to approximately Pounds 90 per teacher before they are paid.”

Non-statutory pay arrangements in further education colleges could also be seriously undermined as a result of the TimePlan legal victory.