College principals have been told that they could cause "agency wars" if they insist on bartering down the cost of supply staff, with devastating effects upon their pay and working conditions.
The warning has come from companies scanning the market for potential new business or aiming to build upon existing work as more colleges have signed up with the controversial national agency for freelance lecturing staff, Education Lecturing Services.
Rival agency bosses, including some who have been working in the field for several years, say one of their greatest problems is college principals who put pressure on them to reduce the cost of supply staff.
Paul Howells, managing director of LHR Education, a London-based agency which has supplied teaching staff to further education and tertiary colleges for several years on an ad hoc basis, said: "I am very concerned by the view that education can be bought and bartered for.
"I am not convinced market forces are a safe way to negotiate people's pay. We have to ensure the staff we supply are paid a fair rate for the job and I believe the time has come for regulation to cover payments in colleges and schools."
The criticism comes as North Tyneside college and Southgate college in London admitted they had signed up to use ELS to recruit some part-time staff. But while few principals are willing to say they are using the agency, its chief director, Geoff Lennox, claimed it was going from strength to strength.
"We are getting more than 3,000 lecturers a week on to our database and take-up has escalated dramatically over the past 14 days," he said.
Kevin McNealy of Nord Anglian Education, which has supplied teachers to schools for 24 years, said he was now setting up an agency in the North-west providing lecturers to colleges.
He said: "I am very much against the idea of ELS which seems to be lacking the human dimension. We do not believe it is possible to sustain the argument that contract lecturers are self-employed, so we employ them."