Legal
Hand in the till
Independent schools are not usually associated with fraud, but in challenging economic times there is an increased risk of financial impropriety taking place. Barney Northover takes a look at how governors can reduce the risk of fraud
Incidence of fraud is not common, but the impact can be great, particularly where fraudulent activities go undetected for some time; in some cases resulting in trustees and senior managers being convicted of criminal offences or in closure of the school, so it is important that this risk is taken seriously.
Greased palms
The Bribery Act was rushed through during the last days of the Labour Government and came into force on 1 July 2011. Hannah Armit explains what the new regulations mean for schools
There has been criticism of the Bribery Act (the Act) and its effect on schools and other organisations, but it is sometimes forgotten that bribery has been a crime since at least 1215, when Magna Carta declared "we will sell to no man either justice or right".
Squatters on school land
How can you reduce the risks of unwanted guests? Michelle Bendall and Simon Linnitt report
With Spring just around the corner, it comes with the inevitable squatter season and the number of schools experiencing problems with trespassers on their land increases dramatically. Twitter, Facebook and other internet sites mean that once a site has been found to be vulnerable by one group, it will remain vulnerable as one set of squatters invariably follows another.
May the force majeure be with you...
As winter approaches, the possibility of school closure arises. And parents, particularly those most hard-pressed, will check the details of your terms and conditions to see if they are due a refund, writes John Deakin
School closures, due to an event beyond the control of the parties (the school and the parents) could bring the legal doctrine of frustration into operation. If parents were to claim that the school is unable to perform the obligations they have bargained for they may be able to seek a refund of fees or to treat themselves as discharged from the contract, enabling them to move their children elsewhere without notice or payment of fees in lieu of notice.
Lee Bolton Monier-Williams’ Schools’ Legal Conference
Date: Tuesday 1 May 2012; Venue: The Vintners’ Hall, Upper Thames Street, London EC4V 3BG.
Participants: Chairs of board of governors, governors, heads, bursars from schools within ISC and the maintained sector.
Proprietorial Schools Conference
Saturday 28 April at Fulham Prep School, London.
Take guard
A significant proportion of boarding pupils have parents who live overseas, either permanently or for lengthy periods of time. Yvonne Spencer outlines schools’ legal responsibilities
Communications via email and telephone are now much easier. However, there are still important benefits for both schools and pupils for there to be someone in the UK who is able to exercise parental responsibility for a child whose parents are abroad. This is why it is strongly recommended that all schools with overseas parents should insist on the appointment of an education guardian.
Taking the credit
There remains uncertainty within schools about consumer credit and how they are to comply with the requirements of the Consumer Credit Act 1974 (as amended). John Deakin sheds light on the implications for fees collection
To understand the consequences of the Consumer Credit Act (CCA), it would be helpful to consider a typical case study, encountered by many independent schools, and to examine the numerous options available.
Government’s visa rules short-sighted
Education: A Great British Export is a recently published report that aims to challenge the Government’s new visa rules. The changes restrict postgraduate employment in the UK to those with a top degree and a job with an accredited employer paying over £20,000 a year.
The report argues that the rules mean the UK's top independent schools and universities could suffer falls in numbers as overseas students are deterred by an apparent lack of welcome from the UK. A similar stance made by the Australian Government three years ago was quickly reversed as its income from overseas students plummeted by A$2 billion.
Careful recruitment
Duncan Bain discusses the impact that the Equality Act 2010 is having on school recruitment
The single biggest effect on schools that the Equality Act 2010 will have is on the way that schools conduct recruitment. These changes are intended to prevent disability discrimination but will have significant implications for the education sector where concerns over the impact of high levels of sick leave are clearly legitimate.
Full employment rights for temporary teachers
Teachers hired on short-term contracts may obtain full employment rights, according to a recent employment appeal tribunal case. Ben Stepney reports
Mr Hussain was employed on a temporary contract to cover for an ill teacher from 25 April 2008 until the summer break started on 8 July 2008. He left on the last day of term but when the school reconvened in September 2008, he commenced employed on a permanent basis.
All change?
Education is always a key election battleground and this year’s was no different. Barney Northover and Chloe Brunton assess the impact of coalition Government policy on public benefit, academies and free schools
The Conservative Party’s manifesto included pledges to “[draw] on the experience of the Swedish school reforms and the charter school movement in the United States” and to give “all existing schools… the chance to achieve Academy status”. The Liberal Democrats’ proposals included the concept of sponsor-managed schools (albeit accountable to the local authority rather than to Whitehall) and freedom to innovate, as well as the proposed abolition of university fees.
The personal touch
Schools handle a lot of information about pupils, parents and staff. New technology brings new challenges and often it can be difficult for schools to know whether they are complying with the law when handling personal information. Doug Locke reports
Quite apart from any damage or distress caused to affected individuals, getting the law wrong can have serious consequences for a school. The Information Commissioner (who is the regulator responsible for compliance with data protection and related law) has been given the power to fine organisations up to £500,000 for serious breaches.
The happy medium
As fee-payers, parents are apt to find reasons for complaint, sometimes unreasonably so. That does not mean that schools should not take them seriously, however. John Deakin reports on the potential consequences
Since 2003, Regulation 7 to the Schedule of the Education (Independent School Standards) (England) or (Wales) Regulations 2003 has required independent schools to publish a written complaints procedure in a prescribed format setting out:
• an informal stage;
• a formal stage; and
• hearing of the complaint by a panel.
Public benefit pressure to ease for independent schools?
The new coalition government is reported to be talking to the Charity Commission about amending the public benefit requirements on independent schools
It is claimed that there will be a change in the apparent initial emphasis on providing more bursaries to pupils from poor families in favour of more community work and with collaborations with maintained schools, as previously revealed by Michael Gove MP in an exclusive interview with Funding for Independent Schools back in September 2009.
Altogether now?
Mergers and closures continue to feature in the sector. Emma-Jane Burnell examines the options
The independent schools sector has experienced increased numbers of closures and mergers of over the last few years. This has been exacerbated by the current economic climate and, in some areas, changes in demographics. But for many schools that are looking for a new strategic direction, this is not the only alternative.
The money funnel
Setting up a fundraising foundation can be key to boosting school funds. However, warns Chloe Brunton, care must be taken when doing so
There is a long history of schools establishing foundations to raise additional funds from current and former parents, pupils and staff. The funds raised are sometimes used for capital projects, and more commonly nowadays (not least in response to the test of public benefit) for means-tested bursaries.
Let the music play on
Music to whose ears? Phil Crier analyses the Government’s decision to remove charities’ music royalties exemption
The Government is removing the current exemption enjoyed by charities and non-profit organisations from the requirement to obtain a music licence from Phonographic Performance Limited (PPL) for playing copyright music to the public.
The staff of life
Discounts in school fees for staff bring many benefits (as well as disadvantages). However, there are also pitfalls to avoid if a school wants to drop or amend its scheme, writes Karl Deakin
Many independent schools offer some form of discount on school fees to staff. Most often this will be offered to teachers and senior executives at the school, although a number now choose to offer it to all staff. There is no doubt that the discount can act as a highly cost-effective aid to recruitment and retention of employees.
The third way
Schools are often the subject of litigation. Whether with personal injury claims or judicial review proceedings, litigation is distracting, time-consuming and a drain on schools’ limited resources, writes Peter Wake
Two sorts of claims have become increasingly prevalent recently: failure to educate and bullying claims. The former might be described as claims relating to a school’s alleged failure to address a pupil’s educational needs. The latter is typically an allegation that teachers have failed to take adequate steps to protect a pupil from bullying. To establish that a teacher has been professionally negligent is difficult and funding is not readily available.
>> read more
Shan't pay, won't pay…
Pursuing parents for unpaid fees can be a fraught process, reports Tabitha Cave
A N Parent says: "We do not consider that we are liable to pay fees in lieu of notice because the school breached the contract in failing to make Britney use a fountain pen at school, therefore depriving her of the opportunity to be national handwriting champion."
>> read more
Licence to lend
With some parents struggling to pay fees, is your school offering flexible fee payment options? David Emanuel and John Deakin explain the legal framework to do so and outline the risks of not conforming to it
In the current economic climate, both schools and parents are reviewing more flexible methods for payment of school fees during the school year to help with cashflow. However, care should be taken before agreeing deferred payment terms with parents.
>> read more
A licence to teach international students
Many independent schools are looking to international markets to increase their pupil numbers. Joy Hankins and Adrian Pashley report on the rules governing licences
Although many schools are aware that to teach pupils from overseas they must obtain a sponsor licence under the immigration rules, many schools are not actually up-to-speed with how to navigate the application process and are not fully aware of the obligations placed on their school once a licence has been granted.
>> read more
Trading places
Most independent schools undertake commercial activities to supplement their traditional income streams; now more than ever before are doing so. Doug Locke outlines the legalities of schools running trading companies
As financial pressures on parents increase, many schools are placing more emphasis on trading as a way of continuing to provide educational excellence, outstanding facilities and demonstrable public benefit while keeping fees affordable. However, charitable schools need to consider carefully how they structure non-primary purpose trading to avoid breaching charity law, paying unnecessary tax and putting governors at risk of personal liability. Central to these issues is the correct use of trading companies. This article covers those points, as well as giving advice on provisions to include in contracts with trading partners.
Parent power
How can you protect your school from actions led by parents? Anita Chopra explains how
Independent schools are finding themselves increasingly embroiled in battles with parents over the quality of education provided to their children, failure to comply with policies and procedures, and with debt recovery proceedings for non payment of school fees.
>> read more
Object lessons
Why should independent schools consider amending their objects? Ros Harwood explains
The public benefit guidance has caused independent schools to consider their charitable objects to decide whether:
• what their school is doing falls within their objects;
• the objects allow the school to do enough to fulfil the requirements; and
• the activities of the school can be counted in assessing the overall public benefit provided.
Beating the recession
As the credit crunch triggers a full-blown recession, there is real concern about the effects on the independent schools sector. Ben Brice reports on the options for struggling schools to survive the turmoil
It has been widely reported that independent schools are likely to face significant reductions in pupil numbers as their parents are no longer able to afford fees. The suggestion is that some schools are likely to face closure or seek a merger as the only viable way to stay in business. This threat is real, although it should only affect very few. For those that do find themselves in such a position, it is vital to keep a cool head when considering how the effects of the downturn should be managed.
>> read more
A licence to teach
In challenging economic times, many independent schools are looking at international markets to increase their pupil numbers. Joy Hankins and Adrian Pashley explain how to acquire the necessary licence
Although many schools are aware that in order to teach pupils from overseas they must obtain a sponsor licence under the immigration rules, our experience is that many schools are not up-to-speed with how to navigate the application process and are not fully aware of the obligations place on their school once a licence has been granted.
>> read more
Contract killers
Schools inevitably enter into a bewildering variety of agreements with suppliers. Doug Locke analyses the relevant issues to all contracts, with a particular focus on specific areas of concern to independent schools
Disputes with suppliers take time and money to resolve. Written contracts help to avoid most disputes by setting out clearly each side’s rights and responsibilities. They also protect the school if something goes wrong. Before entering into an important contract, it is necessary to carry out research into the supplier by speaking to trusted contacts in the sector. Only dealing with people with a good reputation will help to avoid disputes.
In good company
The Companies Act has ongoing repercussions for the effective management of independent schools. Nicola Evans sets out the main provisions relevant to incorporated schools and those with trading subsidiary companies
Among the wealth of legislation and regulation currently assaulting independent schools, those which are incorporated and/or which have trading subsidiary companies should follow the ongoing implementation of the Companies Act 2006 (the Act). The Act encompasses a major overhaul of company law and, at 1300 sections and 16 schedules, is the biggest Act ever passed by the UK Parliament. This may sound disheartening but the Act contains provisions which can help schools in their administration.
>> read more
International branding
An international reputation opens up opportunities for your school to extend the brand overseas. Doug Locke reviews the possibilities and cautions against the potential pitfalls to help protect your good name
International reputation is increasingly important to schools, both to attract pupils from overseas and to take advantage of the greater opportunities for licensing overseas schools.
>> read more
Intellectual pursuits
Intellectual property rights affect schools in many important ways. Doug Locke reviews the key areas
This article focuses on: websites and prospectuses; the protection of names and crests; licensing overseas schools; and combatting abusive websites.
>> read more
Body-building
Increasing numbers of independent schools are becoming incorporated. Mairéad O’Reilly examines the advantages of incorporation as well as some of the key issues that school governors should consider
Incorporation involves the creation of a legal entity separate from the management and members of the organisation involved. The most common and often simplest mode of incorporation for schools is the formation of a company limited by guarantee, registered with the Companies Registry, Companies House. Other corporate forms exist but it is this type of incorporation that is reviewed here.
Scot free
The Charities and Trustee Investment (Scotland) Act has redefined some of the investment powers of Scottish charities. Simon Mackintosh outlines the new opportunities and responsibilities for independent schools
Scottish charities – and particularly independent schools – might be forgiven for thinking that the Charities and Trustee Investment (Scotland) Act 2005 (the 2005 Act) is all about regulation and definition.
>> read more
The Rolling Review in Scotland
Scottish independent schools are considering how to react to the new public benefit tests contained in its charity legislation, writes Simon Mackintosh
While England awaits guidance from the Charity Commission, Scotland already has some useful material to work with. We have a statutory test in the Charities and Trustee Investment (Scotland) Act 2005; and in the pilot studies for the Rolling Review by The Office of the Scottish Charity Regulator (OSCR) which give the first signs of some clear guidance as to how this test will be interpreted.
>> read more
