Funding chiefs have offered a guarantee against compulsory redundancies to prevent industrial action at the head office of Britain's biggest quango.
The Learning and Skills Council wants to thin the ranks of administrators at its national office in Coventry by getting rid of 200 posts - around a third of staff.
Staff were already facing uncertainty with the prospect of some functions being devolved to the council's nine new regional offices. Already 300 of their colleagues have been shown the door as part of a national cull of at least 800 posts out of a total 5,000 staff. The LSC hopes the cuts will save pound;30 million.
But the Public and Commercial Services Union has been told that the latest wave of 200 redundancies, part of the 800 target, will be voluntary or achieved through leaving vacant posts unfilled.
David Cliff, national officer for the PCS, said an 11th-hour deal was due to be signed this week, ruling out compulsory job losses. It was expected to be signed on Thursday - when the LSC was due to announce formally its intention to make 200 redundancies.
Mr Cliff said: "We were looking to go to members and ballot them for industrial action. That position has changed because the LSC has given us reassurances that (compulsory redundancies) is not what they want to do.
"We are on the point of signing a non-compulsory redundancy agreement with the LSC. We are in discussions with the LSC over the final draft. We think it will be open-ended as it stands at the moment but will be subject to review every six months or so."
But the union says the LSC's viability could be threatened if further cuts are imposed as part of a wider review of organisations under the umbrella of the Department for Education and Skills.
The Gershon review, announced in the Budget last year, has led the Treasury to look closely at departments such as finance and human resources in the back offices of public bodies.
A report is expected in the spring, but already the DfES has said that at least 800 jobs are to be cut at its own offices in anticipation of the findings.
Unions fear the DfES quangos, including the LSC, will be next in line. Mr Cliff said: "I understand the DfES wants 15 per cent cuts across the board as part of the Gershon review - which would be on top of the current round of redundancies.
"We think if they went that far the LSC could not function as an effective public body. It's a huge reduction of staff. They are not going to be able to carry out their basic functions.
"The work that the LSC does has not decreased and the problem is that our members' responsibilities are not clearly defined and they will have to take on more and more work."
The LSC wants to loose the 200 posts by December.
Mark Haysom, LSC chief executive, said: "This is a further positive step towards creating the new LSC - one cohesive organisation that will be responsive to our customers.
"Our aim is to reduce costs whilst ensuring a faster, more focused business that provides leadership, drives national policy and ensures effective local delivery."