Governors at Stoke-on-Trent College are investigating allegations that the chief executive and an assistant director have been running a pub while on sick leave.
It emerged this week that assistant director Helen Chandler, who has been absent from the college since September 24 with a stress-related illness, has been granted a temporary licence to run the Dymock Arms in Penley, Clwyd.
A committee of three governors at the trouble-hit college is looking at allegations that Mrs Chandler has been working in the pub, helped by Stoke principal Neil Preston.
Mr Preston, 46, has been on sick leave from the college, also with stress, since September 25. The pair, who have both submitted new sick notes covering the period up till early January, are both on full pay, though Mrs Chandler will receive half pay after 75 days off, as will Mr Preston after 100 days. His Pounds 90,000 salary package is among the most generous awarded to any principal in the further education sector.
The two have been asked to appear before a special committee, formed two weeks ago, on a date within the next 10 days. The corporation is required under its constitution to set up a special committee in any circumstances where it may consider dismissing or taking similar action against senior staff.
Governors took the step shortly after beginning an investigation into governance and management in the light of allegations by some staff that a "climate of fear" had developed in the college.
A survey by the lecturers' union NATFHE of 125 members at the 21,000-student college last July revealed claims of a "dictatorial and bullying" management regime.
Disputes within the governing body over the handling of the allegations led to the ousting of the then-chairman, George Mardle, and the creation of a working party to investigate governance and management.
The special committee examining the performance in college of Mr Preston and Mrs Chandler is due to report back to the full corporation on November 29.
Its chairman, John Seddon, confirmed that the committee would examine the claims that the pair were working in the pub. He told The TES that he hoped the inquiry would be speeded up in the wake of the allegations, but said it could still be delayed if ill-health prevented Mr Preston and Mrs Chandler appearing before the committee.
The managers both joined Stoke from Amersham and Wycombe College, Buckinghamshire, where Mr Preston was principal and Mrs Chandler was vice-principal. On leaving in April 1993, Mr Preston appointed Mrs Chandler as acting principal. She came to Stoke as assistant director in charge of marketing in June 1994.
Neither of them could be contacted for comment.