I'm applying for a new job to switch to industry from academia. My prospective employers have links with my current employer via projects and collaborations. Therefore, I suspect that my prospective employer may informally contact my current employer which may jeopardize my current employment contract. How do I approach this kind of situation?
You can explicitly say in your cover letter (or application form, or say to the new employer directly, or whatever) "please do not contact my current employer for references yet, as they do not know I am looking to leave - I will of course provide a contact if we reach the stage of a formal job offer". This is fairly normal and any reasonable new employer will understand, and take your request at face value.
Unfortunately, while this should prevent any formal request for references, you may not be able to prevent a less formal contact. Off the record contacts - "hey Bob, how's it going, how's the family? Listen, I've had someone called brit871023 send me their CV, what're they like?" - are just too convenient to make and too common an arrangement to avoid. It would be nice to think that people would treat your application confidentially, in fact they ought to really; but if there is any kind of social or friendly relationship between them, that simply can't be guaranteed.
When this has happened to me before, my current employer didn't know I was looking to leave - but they were not at all surprised to find out, though I would have preferred they hadn't yet. Perhaps your current employer won't be surprised either... I realise that may not be much consolation.
Another common approach is not to disclose your current employer until later in the process. You could put on your CV something like "One of the top 10 universities", or whatever generally describes it, instead of the actual institution you work at. You also should, as mentioned in another answer, explain in the cover letter that you will disclose your employer name and provide proper references in due course.