The lecturers' union Natfhe today suspended industrial action in further education colleges and will urge members to accept a new pay offer.
After last ditch weekend talks with the Association of Colleges, which represents employers, the union said it had secured a deal that would increase the value of the current pay offer to 4% in the final four months of the pay year, ending July 2002.
Negotiations centred on an additional £5m made available by the government which the union insisted should be used to increase pay across the board, while employers wanted to retain more discretion for individual colleges.
It is understood government ministers threatened to withdraw the £5m unless a potentially embarrassing strike during next week's Labour party conference was called off. The union has suspended its planned action, and lecturers will be balloted on the new offer.
Paul Mackney, Natfhe general secretary, said the union and the employers were also pledged to try to achieve pay equality between further education colleges and schools by September 2004.
"It's time to recognise that a tangible start to closing the gap between college lecturers' and school teachers' pay has been made, thanks to the determination of Natfhe members. We'll be putting on the pressure to ensure the employers now deliver their side of the bargain. If they don't, we'll be back."
The association said today its policy had always been that money in the government's Teachers Pay Initiative should be distributed as evenly as possible. "We are extremely pleased that at long last Natfhe has seen sense and done what is necessary to help its members. We have found it a frustrating process to try to get money into the sector which was already on the table," said a spokesman.
The employers have agreed to look at lecturers' pay structures in comparison with schoolteachers, but want any policy to include technical and administrative staff as well.
The spokesman added: "The next stage has got to be for a joint approach to government about raising levels of funding in colleges so that we can afford to pay all our staff - not just lecturers - at appropriate levels."