A total of Pounds 50 million will be withheld from all FE and tertiary colleges which fail to commit themselves to getting all lecturing staff to sign flexible contracts.
Last year, penalties related only to contracts for new and promoted staff. But in a letter to the Colleges' Employers' Forum this week, education minister Tim Boswell said they would apply to all new and amended contracts from April 1, 1995 "whether with new or existing staff of the college".
But in a separate letter to the Sixth Form Colleges' Employers' Forum, he praised their success in getting 82 per cent of colleges to move on to the contracts, with the remainder expected to do so shortly.
Sue Whitham, secretary of the SFCEF, said: "By the end of this year we will have all new and existing staff, teaching and support staff, signed up to new contracts."
The introduction of new-style contracts into sixth-form colleges has proved more successful than expected, sparking extensive recruitment of adult learners.
Staff in many colleges have adapted to requirements to teach up to a maximum of two evenings a week in lieu of day work, enquiries by The TES have revealed. Many lecturers have requested more flexible hours to boost adult recruitment.
Sixth-form colleges had a relatively painless change, compared with the industrial action that has disrupted the rest of the sector. Coming from the school sector in 1993, they negotiated using the 1,265-hour teacher contract.
"To begin with I think people were fairly reluctant to teach in the evening, but having recognised they are not being asked to do this on top of their full workload they now say they find it rewarding working with adults," said Madeleine Craft, principal of Long Road sixth-form college, Cambridge. The college has 1,240 16 to 19-year-olds and four to five hundred adult students.
"We have started running evening classes for adults and want to integrate them into the college in such a way that they have a similar infra-structure in terms of support and quality assurance."
Louise Kidd, principal of Rutland sixth-form college, Leicestershire, which now has 450 adult students, said a number of staff ran two evening courses a week and were "realistic about the need for change in the new environment".
She said: "There is a positive attitude towards adults in the college. Our staff realise there is a need to look at different types of provision, the working day is being reviewed and we now have three sessions in a day which we did not have before."
Peter Newcome, principal of Franklin sixth-form college, Grimsby, said: "In a year we have recruited 300 adults, 50 of them study during the day, and we also run evening classes at least three nights a week. We were not surprised by our staff's response for increased flexibility - the changes we have experienced have produced a very positive picture."