Staff at a new university have been offered a "no redundancy" clause by their vice chancellor if they join a profit-related pay scheme. The scheme has the support of lecturers' union Natfhe, but not of Unison. Staff fear that those who refuse to join will be more likely to be made redundant.

The University of the West of England faces a Pounds 5 million shortfall this year and hopes the scheme will generate tax savings of around Pounds 1 million. In a letter to all staff this month, vice chancellor Alfred Morris wrote: "The chairman of the board of governors has accepted my recommendation that the 'no redundancy' clause recently negotiated by Natfhe should be extended to all who join the tax-free pay scheme."

But an anonymous letter sent to The THES reads: "Staff have been put under pressure by individual managers to sign up for the scheme as otherwise the department may face budget cuts . . . the majority who did not vote in favour of the scheme would be the first to be selected for redundancy."

Rob Cuthbert, assistant vice chancellor, said: "If we get the scheme, we don't expect to make redundancies. If we don't get it, then the question doesn't arise."

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A profit-related pay scheme means that employees can receive up to Pounds 4,000, or 20 per cent of salary, free of income tax. An institution can reduce salaries by the amount of the tax savings, thereby saving on its payroll. Under the UWE scheme, take-home pay would be increased, depending on salary level, and there would be a payment of not more than Pounds 400 in December next year.

In his letter the vice chancellor said that the university needed the benefits of the scheme "more than ever if we are to avoid further budget cuts and the prospect of redundancies". More than 70 per cent of staff have joined, but the approval of 80 per cent is needed. Mr Morris asked staff who have already joined to urge the rest to make up their minds.

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The "no redundancy" clause is one of the additional "supplementary safeguards" negotiated by Natfhe after the scheme was first proposed. Gillian Blunden, the branch chair, said: "The university now offers some protection against the prospect of compulsory redundancies and has given an important new undertaking regarding the use of visiting lecturers." These safeguards would apply to Natfhe-covered staff who had already joined the scheme, as well as those who now decided to do so.

Natfhe's national policy opposes profit-related pay schemes, but acknowledges that members may support them, particularly if jobs will be saved. In contrast, Unison's UWE branch has continued to oppose the scheme, in line with its national policy.

In April 20 institutions attended a Universities and Colleges Employers Association seminar on how to introduce PRP schemes.

Concern over implementing PRP in ÖйúAƬ focuses on universities being deemed profit-making organisations. An article in last month's Labour Research says: * Higher education employers may not be able to reinstate pre-PRP salary levels or spending on services and facilities if "profits" fail or turn to deficit * Repaying unpaid tax if a PRP scheme was cancelled could cause a financial crisis.

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* The need for universities to show a profit motive could lead to the questioning of "non-profit-making" activities.

* PRP could worsen the funding crisis if accounting "surpluses" are taken into account by funding councils.

* National bargaining could be undermined.

* Discussions on fitting pension schemes in with PRP are ongoing.