Cheltenham and Gloucester Institute of Higher Education is to pay a part-time lecturer more than Pounds l,800 in compensation following complaints that its performance-related pay scheme was discriminatory.
The college has also given an undertaking that any future PRP scheme - it no longer runs one - would only be set up with proper consultation and an independent audit.
Sandra Jeans, a lecturer in information technology, has now withdrawn her case which was due to be heard by an industrial tribunal with the support of Natfhe, the lecturers's union.
Mrs Jeans had found faults with the way the PRP scheme treated part-time lecturers. As a result of undertaking a narrower range of duties, such staff had restricted access to the scheme, she claimed. A college internal review showed that the scheme gave female full-timers a slight advantage, and part- timers a slight disadvantage.
Mrs Jeans said: "I am pleased that a proper settlement has now been negotiated which not only involves a cash payment but also proper consultation and an independent audit of any future schemes. I am paying the money into branch funds so that various staff who suffered under the scheme, especially the women part-timers, may receive some compensation."
But Chris Turner, college assistant director, said the review had shown overall that part-timers had not really been disadvantaged.
"We have agreed to pay because it is cheaper than continuing with the industrial tribunal process. Preliminary proceedings had already cost about Pounds 6,000. Going to tribunal would cost another Pounds 10,000, so in effect you are talking about someone's salary here," Professor Turner said.
Natfhe, which wanted to obtain a decision that could have been applied to other PRP schemes, said nevertheless that the settlement represented recognition of the detriment suffered by part-time staff and had implications for the full timers at the lower end of the lecturing scale.