In March we produced our toolkit to help independent schools manage the unprecedented challenges posed by the Covid-19 pandemic. As society starts making steps towards a return to normality and schools prepare to welcome back pupils, we have updated this key resource for independent schools as they continue to navigate their way through the next uncertain stage of the ongoing crisis.
Return of pupils to school
Since 1 June, primary schools have been allowed to welcome back pupils in Reception, Year 1 and Year 6 into classes that are limited to 15 pupils. Since 15 June secondary schools have been allowed to offer some face-to-face support for Year 10 and Year 12, provided no more than a quarter of these year groups are in school at any one time.
The Government has announced that primary schools are allowed to start the return of additional year groups where they have the capacity and facilities to do so safely. For many prep schools, this is likely to be a welcome announcement that will give them the opportunity to bring back Year 8 pupils before they progress on to their secondary schools. The Government is also encouraging schools to invite secondary school pupils in for a face-to-face meeting before the end of term. Before making decisions on welcoming back these additional pupils, it will be important to carry out an appropriate risk assessment and to implement all necessary safety measures (see below).
The stated aim of the Government is to have all children back in the classroom from September, however there is so far no guidance from the Government as to how this will be achieved. We recommend that independent schools plan both for a return of pupils and for the continued provision of remote learning – we have already witnessed the Government U-turn on its decision to have all primary pupils return before the summer holidays, so it is advisable to i have plans in place for both eventualities.
Risk assessments and safety measures
In preparation for the return of pupils, all schools should be carrying out risk assessments that specifically address the risks associated with Covid-19. Following the outcome of the risk assessment, schools should be looking to put together a package of measures in order to provide the safest possible environment for pupils and staff. In particular, issues to tackle will include:
- Procedures to minimise contact with anyone who develops symptoms of Covid-19;
- Measures around hand washing;
- Measure regarding respiratory hygiene;
- Cleaning procedures;
- Steps to minimise contact between pupils; and
- Making pupils’ journeys to school as safe as possible.
Schools will need to think creatively about how to minimise pupil contact with each other. For example, the package of measures is likely to feature re-arrangement of timetables, re-organisation of classroom layouts and implementation of one-way systems in the corridors. These are the Government’s guidance on protective measures – Coronavirus (COVID-19): implementing protective measures in education and childcare settings.
Many schools have had to make difficult decisions regarding what to charge by way of fees, often seeking to strike a balance between the financial struggles of parents and the existential threat posed to the school by any proposed reduction in income from fees. As September approaches, schools will, again, be considering how much they intend to charge parents.
When making these decisions, schools should bear in mind that it is unlikely that there is any legal obligation on them to reduce fees. Where schools are charities, the school’s governors owe a duty to act in the best interests of the charity and to act reasonably and prudently, so governors must think carefully before agreeing to refunds or reducing fees. Double check the relevant terms of the Parent Contract. Most model contracts contain terms that help to protect the school in this crisis and should ensure the following effect:
- Parents must give at least a term’s notice to withdraw their child or cancel acceptance of a place; or pay a term’s fees in lieu of notice;
- There is no refund or reduction of fees in the event that the child is absent from school;
- School reserves the right to change the way in which education is provided including provision of education remotely in the event that the school has to close;
- School reserves the right to require the child to remain at home in the event of epidemic, pandemic or other health risk, and continue to provide education remotely;
- Where events occur which are outside the school’s control, including epidemic and pandemic, and where the school acts reasonably to minimise the impact, fees remain payable during a specified period e.g. six months.
Where governors conclude that discounted fees are necessary in the school’s interests, it is imperative that parents understand this is by way of concession, not the contractual position, and that these decisions and the reasoning should be carefully recorded in governor meeting minutes.
We have witnessed an increase in parents who are refusing to pay fees, either because they do not feel the school is doing enough to ‘earn’ it, or because they have witnessed a drop in their own income. The most effective way of combating such situations is to continue to provide as full and comprehensive a curriculum as possible in the circumstances. However, where unpaid fees become a problem, we can help in guiding schools through the most appropriate means of ensuring the issue is not allowed to slip under the radar.
Job Retention Scheme
The Government’s Job Retention Scheme has been a lifeline to many schools during the period of school closure, allowing schools to keep staff on their payroll whilst claiming from HMRC 80% of wages up to a cap of £2,500 plus associated National Insurance and pension costs. Some schools have made the decision to top up wages to 100%, whilst others have asked staff to reduce their pay to the level reclaimable from HMRC.
The scheme will be closed to new entrants from 30 June meaning that any member of staff who was not furloughed prior to this date will not be eligible for furlough for the remainder of the scheme period. As new entrants will be required to have been on the scheme for at least 3 weeks before 30 June, this means that 10 June was the last date for schools to place staff on furlough.
Going forward, the Government is asking employers to contribute to the cost of furlough. This will be introduced from August in a staggered way as follows:
- From 1 August: The Government will continue to pay 80% of wages up to a cap of £2,500 (as is currently the case) but schools will have to pay the employer’s National Insurance and pension contributions. Those costs can no longer be claimed for through the scheme.
- From 1 September: The Government will pay up to 70% of wages up to a cap of £2,187.50. Schools will have to pay the employer’s National Insurance and pension contributions as well as 10% of wages in order to top-up the employee’s pay to 80% of wages overall.
- From 1 October: The Government will pay up to 60% of wages up to a cap of £1,875. Schools will have to pay the employer’s National Insurance and pension contributions as well as 20% of wages in order to top-up the employee’s pay to 80% of wages overall.
Previously, an employee had to be on furlough leave for a minimum period of 3 weeks. However, from 1 July schools will be allowed to bring back furloughed staff to work part-time, meaning they are allowed to work for some days (or even part days) and be on furlough leave for other days. Schools will have to bear the cost for a member of staff for the time they have worked and the Government will contribute to the costs of that member of staff when they are at home, “furloughed”. This additional flexibility is likely to help schools to bring back furloughed staff to assist in preparing for re-opening in September, whilst still allowing schools to make a saving on staff wages. Any schools wanting to take advantage of the flexible furlough arrangement will need to enter into fresh furlough agreements with staff, as the previous agreements are likely to prohibit staff from carrying out any work during their furlough period.
Claim periods for the new arrangements are going to be limited and must not overlap calendar months. This means that any claim in respect of the period before 30 June will have to be made before 31 July. Any claim in respect of a period after 1 July must start and end with the same calendar month.
The scheme will come to an end on 31 October and schools will then be responsible for all of their staff’s costs.
As schools re-open, staff who have been furloughed or working at home may resist requests to return to the classroom, particularly if they fall into a vulnerable group or if someone in their household falls into a vulnerable group. Schools should be careful in how they handle such resistance, as vulnerable members of staff are likely to enjoy the protection of equality legislation. In addition, any unfavourable treatment could lead to these members of staff bringing claims under health and safety laws or whistleblowing laws. Such instances should be sensitively handled on a case by case basis, and we will be very happy to provide advice where necessary.
While schools remain unable to provide a full service, they should consider whether their commercial contracts are impacted. Affected contracts are likely to be supplier contracts including catering, maintenance and transport contracts.
In particular schools should consider the following provisions:
- Force majeure: A force majeure event is the occurrence of an event which is outside the reasonable control of a party and which prevents that party from performing its obligations under a contract. The agreement will sometimes contain a clause that will set out how the parties’ obligations are affected by this event – for example delaying performance or terminating the agreement. Force majeure clauses vary from contract to contract so it is always important to read the particular clause before seeking to rely on it, with specific consideration paid to whether a pandemic is specifically covered by the clause. In each case the party seeking to rely on the clause would typically need to demonstrate that an event beyond their reasonable control has affected their ability to perform their obligations under the contract and that they have taken all reasonable steps to mitigate the consequences.
- Termination: The school (and the supplier) will have the right to terminate their agreement in a variety of circumstances, but the two that will likely be available in each agreement will be to either terminate the agreement immediately in the event of a breach, i.e. the supplier fails to provide the services in line with the agreement, or terminate on a ‘without cause’ basis, allowing the agreement to be terminated following a prescribed notice period. Due to the contentious nature of terminating due to a breach and the need to provide reasons, the school should pay particular attention to their right to terminate on a ‘without cause’ basis. In cases where there is a short or even reasonable notice period, it may be the most cost effective and practical solution available. It is possible that a force majeure clause will also give the school the opportunity to terminate the agreement immediately.
- Service levels: Depending on the nature of the services, there may be provision in the contract to allow the school to reduce the level or frequency of the services provided. This will allow the school to reduce the cost burden for a period but keep the supplier in place for the remainder of the contract. It is important to note, however, that the lack of such a provision does not prevent the school from negotiating with the service provider and seeking to come to a similar arrangement a specified period of time, though any such variation to the contract should be completed formally.
If the above options are not readily available to you or, if you do not feel that they are appropriate for your specific circumstances, it may be possible for you to end the contract by asserting that it has been frustrated, which sets aside an agreement where an unforeseen event renders the parties’ obligations impossible. Alternatively, consider engaging in the dispute resolution process.
If you are considering any commercial agreements, we strongly recommend that you seek professional advice before doing so.
The Covid-19 crisis has resulted in some international students withdrawing home, while others remain stranded in the UK, whether at school or in the care of education guardians. Immigration rules relating to visas and Tier 4 sponsorship of students have been temporarily relaxed in response to the crisis. The latest information from the Government on this relaxation of the rules can be found in this document the Covid-19: Guidance for Tier 4 Sponsors and Migrants and for Short-term students. We are able to provide specialist advice on Tier 4 sponsorship and we encourage schools to contact us with any sponsorship queries.
Plans for the future
As the knock-on effect of Covid-19 sweeps through the economy, it is conceivable that independent schools may experience a drop in pupil numbers. If this happens, governors will need to make careful decisions about how to ensure schools continue to prosper in the post-Covid-19 economy and it will be important not to delay in making tough decisions. It may, for example, be necessary to look at saving costs by making redundancies of by withdrawing from the Teachers’ Pension Scheme (see our separate article Teachers’ Pensions: returning to the fray). Alternatively, governors may want to look at their school’s business model. There is a growing trend of school mergers, which allow schools to benefit from a pooling of resources and the natural progression of pupils from one school to another. If you would like to discuss any potential plans to ensure your school continues to thrive, then please do get in touch and we will be very happy to help.
We are expert charity law solicitors and can assist you in any area when it comes to legal advice for independent schools, or even with Covid recovery of debt to help with cashflow at this challenging time. Get in touch today.