Principal Richard Gorringe said the new terms were necessary to ensure the survival of the college. He has given staff still on local authority conditions until November to sign or be dismissed. They would then be offered their jobs on the new contracts and given a 2.9 per cent wage increase.
The lecturers' union NATFHE is to ballot for strike action at the college. Sue Berryman, NATFHE's head of further education, said: "Bedford College's conduct is an absolutely outrageous attempt at intimidation." She called on management to negotiate reasonable contracts.
Two-thirds of the staff have signed new contracts, including more than half the 148 full-time lecturing staff.
Mr Gorringe said the college could face a Pounds 500,000 deficit next year. "We cannot any longer afford 14 weeks holiday and lecturers teaching only around 20 hours a week. We realise that it is painful to give up these conditions, but the survival of the college and its service to students must come first."
Attempts to hold talks failed amid confusion over management's plans. The union is seeking legal advice after staff were sent letters threatening dismissal.
The new contracts require lecturers to work a 43-week year and a 37-hour week. Ms Berryman said that the union was further concerned that there were no safeguards on maximum teaching hours. She disputed the depth of the financial crisis as the college had just launched plans for a Pounds 4 million building extension.