Faculty members at Montgomery College, who have been working without a contract for eight months, say they plan to boycott next month's graduation exercises to dramatize their demand for a 7 1/2 percent pay increase.

Some teachers began informational picketing of the college's Gaithersburg campus last week, and have vowed to boycott other ceremonial events, including those marking the college's 40th anniversary, a spokeswoman said.

"We have planned everything short of striking," said Marilyn Scheiner, president of the Montgomery College chapter of the American Association of University Professors, the bargaining unit that represents 367 faculty and staff members at the college's three campuses. The union has about 200 members.

Administrators of the 20,000-student college said the teachers have rejected an offer for a 6 1/2 percent average pay raise this academic year and a 5 percent average increase next year. An independent fact finder chosen by both sides recommended late last year that faculty salaries be increased by 7 1/2 percent.

The union has accepted the fact finder's recommendations but the administration has not, officials said.

Last fall, after the contract expired, the board of trustees approved a 4 1/2 percent wage boost, which was implemented while contract negotiations continued.

A college spokesman said the average annual salary for full-time faculty members is about $33,000. The union also represents counselors and some librarians as well as teachers.

The college operates with state and county funding as well as tuition revenues, and any additional salary increases would have to be approved by the board of trustees. In January the trustees approved a $49.6 million operating budget for next year that includes additional money for salaries, but the amount is not spelled out.

The past decade has been a turbulent one for administrations and faculty at the college, and since the teachers union was organized six years ago, only one contract has been approved. Negotiations for the now-expired contract dragged on for two years; the current round of bargaining began in October 1984.

Last week, as the current contract dispute entered its 19th month, about half of the faculty members at the Germantown campus began working "to rule," performing only the duties spelled out in the expired contract, said Josephine Peck, a computer science teacher.

"We are holding our classes and keeping three posted office hours a week," she said. "But we are no longer available for extracurricular activities like serving on committees and advising students outside of office hours.

"At this point we feel we've been patient too long. We feel we must do something to display our upset and anger at what's been going on." State law prohibits the union from striking.

Founded in 1946 as part of the county public school system, the former two-year junior college is one of the oldest community colleges on the East Coast. Each year about 90 percent of its students come from Montgomery County. The rest come from other Maryland counties and from out of state.

In addition to attracting a high percentage of local high school graduates, the college also has a number of students over the age of 35, among them women returning to their studies. In 1983, women made up 57 percent of the enrollment at Montgomery College, and on average, they were 18 months older than the men.

The institution emerged from the 1970s, a time when a financial crunch exacerbated tensions over salary increases, tenure policies and faculty rights, with the faculty union in place.

Since the mid 1970s, teachers and the college administration have been at odds over tenure appointments, a condition of employment that imposes strict conditions for firing. Over the years, the union has demanded more tenure appointments but the administration has made just a few, the last in 1977. About two-thirds of the faculty is tenured.

College administrators say they need flexibility to hire and fire professors in certain disciplines.

The fact-finder in the current dispute, William Edgett, said in a report in November that "a recommendation for a direct return to a tenure system at this juncture should not be implemented." He said he did not believe the issue could be settled now.

Frank Tusa, director of employe relations for Montgomery College, said the institution is not bound by law to accept the mediator's report.

Tusa said he did not want to comment on the status of the negotiations other than to say "I am very hopeful it will be resolved." The two sides held a bargaining session last weekend and will meet again this weekend, a school official said.

Last month, faculty sent a letter, signed by 274 persons and asking that both sides accept the mediator's report, to the college's trustees, the county council, County Executive Charles Gilchrist and local state legislators.

Several weeks ago about 60 bargaining unit members from the three campuses attended a meeting and voted overwhelmingly to boycott the graduation and next year's anniversary celebration, Scheiner said.

William Patterson, a counselor at the Rockville campus, said he plans to be at the May 23 graduation for the Rockville campus, but "with a sign."

Barbara Stout, an English professor and union vice president at the Rockville campus, said she hopes faculty members will have a contract by then "so we can get about our business. We want to be on committees and we want to be at the graduation, but we also want a contract that is fair."