Academy schools and furloughing staff - PKF Francis Clark
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Academy schools and furloughing staff

Updated government guidance provides five conditions to enable academy schools to furlough staff. 

The government guidance for the education sector makes clear that no organisation should profit from the support available and hence that organisations like academy schools that continue to receive government funding should not furlough staff where their salaries are otherwise covered by government funding.  Likewise they should continue to provide the service in accordance with relevant guidance, which may mean staff need to be redeployed to best support the Coronavirus response.

As a result it is generally the case that academy schools are not expected to access the Coronavirus Job Retention Scheme (CJRS) – click here for details.

However, the guidance has recently been updated to clarify that there may be educational settings where there is also private income that ceases or is reduced, where there may be a need to furlough staff paid from that private income.  In this case five conditions must be met before a claim is made:

  1. The employee works in an area where services are temporarily not required and where their salary is not covered by public funding
  2. The employee would otherwise be made redundant or laid off
  3. The employee is not delivering provision that has already been funded
  4. The employee is not required to deliver provision for a child of a critical worker / vulnerable child
  5. The grant from the CJRS would not lead to financial reserves being created nor duplicate other public grants received

Therefore, in respect of academy schools, potential areas were academies may have private income streams could include catering and sports facilities lettings.  You can find more information about the government’s Coronavirus Job Retention Scheme and furloughing here.

Good governance in these scenarios remains vital and the guidance requires all other potential options to be pursued first (such as redeploying staff or making budget savings from the existing budget) before seeking grant paying schemes like CJRS.

Where the scheme is appropriate, the guidance provides a worked example of the calculation basis citing the example that if 4% of total income is private (i.e. parent paid school meals), the school could claim through CJRS up to a maximum of 4% of its paybill (after exhausting other options) by furloughing say catering staff whose usual salaries are linked with the income lost.

If you consider the scheme may be an option for an employee, it is vital that the position is carefully checked and professional advice is taken such as over redundancy rules, employment law and unintended consequences such as the impact on any employees pension position.  Similarly the Academies Financial Handbook requirements should continue to be considered, for example in respect of whether such a claim could be considered novel or contentious depending on the circumstances.

FEATURING: Darren Perry
Darren Perry ACA DChA is a director of the firm, based in the corporate department of our Truro Office. He has specialist expertise in the… read more
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