The last couple of years have seen independent schools facing unprecedented financial challenges. The introduction of VAT on school fees, coupled with a cost of living crisis, have resulted in many schools witnessing concerning declines in pupil numbers. On top of this schools are grappling with increased operational costs, ever-rising contributions to the Teachers’ Pension Scheme, and the loss of Mandatory Business Rates Relief. As a result of this, lots of independent schools are having to look at restructures and redundancies.
The recent case of Richter v Atomics Educational Trust is a poignant reminder to schools of the importance of taking the time to carefully plan out their restructure, and to ensure they are following a fair process, including compliance with their legal obligations and with any internal redundancy policies.
Prior Pursglove Academy
Mr Richter worked as a Liaison Manager at Prior Pursglove Academy in North Yorkshire. He had been there for 26 years, since he was 19 years old. His role involved providing support and guidance to pupils, managing various support staff, covering for absent teachers and working with pupils with SEND.
The school proposed a restructure, in order to separate out teaching work from the support services functions, and to improve its provision for SEND pupils by the creation of a SEND Endeavour team. Mr Richter’s role was identified as being one that was at risk of redundancy. The school started its redundancy consultation, and invited those staff who were at risk to apply for alternative vacancies.
Redeployment options
Mr Richter applied for one of the new roles that would be created under the restructure – the position of Deputy Head in the SEND Endeavour team. Mr Richter had the experience, skills and capabilities required for this role. However, the criteria for the role specified that the applicant needed to be qualified to degree level and have a professional teaching qualification or qualified teacher status. Despite Mr Richter being able, on a practical level, to carry out the role, he was told that he could not be considered for the role as he did not have the required qualifications.
Instead, Mr Richter was offered an alternative role as a Student Liaison Lead. The role itself was similar to Mr Richter’s Liaison Manager role. However, Mr Richter turned this role down as it entailed taking a pay cut of almost £5,000 a year. In addition, the Student Liaison Lead role would have involved travelling across two sites whereas he had previously worked at just one site, and it would also not have included any management responsibilities and would be a demotion.
The school had a redundancy policy. This policy committed the school to “Pay protection: For those individuals accepting redeployment a period of pay protection will be offered in an attempt to keep individuals in work. The period of pay protection will be determined in the context of affordability and in the light of any other relevant circumstances and will be agreed with individuals and on each occasion of a redundancy/restructuring programme being proposed.” However, pay protection was not offered to Mr Richter on the basis that the school felt roles should be “benchmarked”.
The Employment Tribunal decision
The Employment Tribunal accepted that the restructure was for genuine business reasons and that Mr Richter’s role as Liaison Manager was redundant on legitimate grounds. The Tribunal also upheld the school’s decision to debar Mr Richter from applying for the Deputy Head in the SEND Endeavour team, emphasising that it was not unreasonable for the school to impose qualification requirements on this role.
However, the Employment Tribunal decided that Mr Richter had been unfairly dismissed on the basis that the school had not followed its own policy in relation to pay protection. The policy gave the school discretion to determine the length of the period for which pay would be protected, but it did not give the school discretion to avoid protecting pay altogether. It was mandatory that the school protected Mr Richter’s pay when offering him an alternative role. The main reason Mr Richter had given the school for rejecting the Student Liaison Lead role was the cut in salary. The school was found to have acted unfairly and unreasonably, and in breach of its obligation to avoid or minimise redundancy by offering redeployment.
What this means for schools
For any schools considering a restructure, the key to getting the process right lies in careful planning. This will include checking whether the school has a redundancy policy and, if so, then that policy will need to be followed. If the redundancy policy does not set out the process that the school intends to follow, then schools should consider updating the policy, and undertaking any necessary consultation in relation to this, in good time ahead of any redundancy consultation being commenced.
We regularly support schools through restructures and redundancy, and any schools needing advice should feel free to get in touch.
