An independent arbitrator has criticised Keele University's approach to controversial restructuring plans that were wrongly rubber-stamped by the university's governing council.

Baroness Ashton of Upholland, Keele's quasi-judicial disputes arbitrator, known as the "visitor", upheld a claim that the university breached its charter and statutes by bypassing the senate with the proposals.

The ruling relates to the plan by Janet Finch, the vice-chancellor, to replace the School of Economics and Management Studies with a new business school. Compulsory redundancies were threatened.

The visitor said the council was "invited to endorse the decision of the vice-chancellor's committee".

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A Keele lecturer lodged a petition claiming that when the council failed to refer the plans to the senate, which directs academic policy, it "appeared to be fait accompli".

Baroness Ashton said that, under Keele's constitution, the direction of new proposals for teaching "clearly was the responsibility of the senate" and the council was not empowered to "endorse recommendations as final". She said: "To bring them before the senate ... when it was too late for the senate to influence the strategic academic direction of significant changes is not within the letter or intent of the charter and statutes."

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She added: "While the council may suspect that if a reorganisation proposed may involve redundancy of academic staff the senate would be reluctant to approve such a course, that is no ground for suggesting that proposals ... should not at least be considered by the body whose responsibility it is to direct and regulate the teaching of the university."

A source at Keele, where talks between the university and the University and College Union (UCU) continue, said the ruling was "incredibly damning" and that Professor Finch had been "humbled".

A Keele spokesman said: "We are disappointed that the visitor has found in favour of the petitioner, and we are taking legal advice on the legal opinion accepted by the visitor."

Meanwhile, UCU branches at three universities are balloting on industrial action. The University of Wales, Lampeter, branch has called for a vote over plans to make two academics redundant. The university was ordered to suspend action on the redundancies last week after a petition to the visitor. As the visitor position is vacant - former incumbent the Bishop of St David's resigned in May - temporary visitor Sir Roy Beldam QC will consider whether he has jurisdiction over the matter then decide whether correct procedures were followed.

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Nottingham Trent University UCU members said they would ballot for strike action after talks on a new union-recognition agreement stalled. They also threatened to organise an international boycott of the institution over the proposed agreement, which they said would cut their facility time. Non-academic unions Unison and GMB accepted the changes. Nottingham Trent, which plans to instigate the changes from October, said it would meet the UCU on 24 September.

The UCU at Coventry University opened a ballot last week in protest against a performance-related pay system. The union says there is no guarantee that the scheme would work to members' advantage, could lead to loss of pay increments, and does not conform to the national framework agreement. The deal has been accepted by non-academic staff.

Madeleine Atkins, the vice-chancellor, said: "There is no pay cut, and nobody will be worse off because everyone has a choice over whether they move to the new proposals or keep to existing contracts."

john.gill@tsleducation.com.