EDUCATION BUILDING AND DEVELOPMENT OFFICERS GROUP (EBDOG)CONFERENCE 2012

‘Academies – A legal perspective for Local Authorities’

FOOT ANSTEY SOLICITORS

Why are we here?

AIM OF THE SESSION

• To gain a better general understanding of what Academies are and;

• To understand the legal process of transition, and;

• To understand the land and property implications for you as Building and

Development officers

GOVERNANCE MODELS & OPTIONS – MAINTAINED OR SPECIAL

• Community

• Voluntary

Controlled

• Voluntary

Aided

1. Foundation (without

a foundation)

2. “Soft” federation

(collaboration)

3. “Hard” federation

4. Trust- Single school- Multi-school

5. Cooperative Trust

Conversion Options

6. Academies

Single Academy

Multi-Academy- Collaborative

Partnership- Umbrella Trust - Academy Cluster- VA & VC/Community

Academy Cluster

Cooperative Academy Sponsored Academy

Standard Models

Academies

• Academies are centrally state-maintained but independently-run schools

• Established by Labour as a way of turning around the worst performing Schools

and schools in disadvantaged areas

• Academies Act 2010

• Opened up the Academies programme for primary, secondary and special schools

to apply to become Academies either independently or as Academy chains or

clusters

ACADEMIES – legal entity

• Academies are new legal entities

• Academies are charitable companies limited by guarantee

- purpose and powers enshrined in the Memorandum and Articles of Association of

the Company.

WHAT ACADEMIES ARE NOT….

• Academies are NOT Independent Schools in the same sense as Private

Independent Schools.

• Subject to legislation, regulations and rules

THE LEGAL PROCESS OF CONVERSION

• 5 Main areas:

• Governance

• Property

• Employment

• Funding

• Transfer of non-property assets

THE LEGAL PROCESS OF CONVERSION – GOVERNANCE (1)

The Academy Trust (see next slide)- Company registered at Companies House & governed

by Articles of Association- Enters into Funding Agreement with Secretary of State

to receive 100% funding direct instead of via the LA with up to 10% top-slice deducted

- Responsible for the running of the school- Employ staff- Admissions authority- Own land and buildings (either freehold or 125 yr lease)- Strategic direction, accountable, critical friend- Corporate body with separate legal identity- ‘Excepted’ charitable status

Principal- Responsibility for the day-to-day management of all

aspects of the school- Delegates duties to other senior leaders and staff

School (aka Academ

y)

Articles may allow LA to appoint up

to 1 Governor

but not compulsory

LA has no formal role

Academies receive funding

direct from central

government (EFA)

THE LEGAL PROCESS OF CONVERSION – The Academy TrustACADEMY TRUST

Company registered at Companies House & governed by Articles of AssociationEnters into a Funding Agreement with Secretary of State

Directors / Governors / Trustees (“the Board”)

Responsible for overseeing the day to day running of the AcademyUsually the same people as are sat on the existing Governing Body

Members

“Guardians" of the companyCertain residual powers reserved to them in ArticlesProvide a "guarantee" of £10 towards the debts of the Academy Trust in

the event it is wound up and cannot pay its debts

THE LEGAL PROCESS OF CONVERSION – The Academy Trust

• Members• Must include Chair of Governors• Also normally includes Principal and other Directors/Governors/Trustees• Where school was previously VA / VC the Church will expect representation at Member

and Director/Governor/Trustee level

• Company Secretary• Responsible for the smooth administration of the company• Role includes keeping minutes of meetings, calling Members and Directors meetings,

filing documents at Companies House and ensuring statutory registers are maintained

MULTI-ACADEMY: COLLABORATIVE PARTNERSHIP

COLLABORATIVE PARTNERSHIP

Written agreement(s) in place between the academies aimed at raising

standards across the partnership

SCHOOL 1

ACADEMY TRUST

Governed by own

Articles

of Association &

Funding Agreement

SCHOOL 2

ACADEMY TRUST

Governed by own

Articles

of Association &

Funding Agreement

SCHOOL 3

ACADEMY TRUST

Governed by own

Articles

of Association &

Funding Agreement

Similar to “soft”

federation

MULTI-ACADEMY: UMBRELLA TRUST

SCHOOL 1

ACADEMY TRUST

Governed by Articles

of Association but own

Funding

Agreement

SCHOOL 2

ACADEMY TRUST

Governed by Articles

of Association but

own Funding

Agreement

SCHOOL 3

ACADEMY TRUST

Governed by Articles

of Association but

own Funding

Agreement

UMBRELLA TRUST

Same model as ‘The Trust’ in a Trust school (Directors/Trustees & Members etc)Directors/Trustees & Members likely to be made up of representatives of schools & possibly external partners

Directors/Trustees have power to elect majority or minority of the Governors/Directors/Trustees of each academy’s Academy Trust (to be determined before conversion)

Similar to multi-school trust

MULTI-ACADEMY: ACADEMY CLUSTER

ACADEMY TRUST

DIRECTORS

MEMBERS

Governed by Articles of Association

& Funding Agreement for

Academy Trust

SCHOOL 1

LOCAL

GOVERNING

BODY OR

ADVISORY BODY

SCHOOL 2

LOCAL

GOVERNING

BODY OR

ADVISORY BODY

SCHOOL 3

LOCAL

GOVERNING

BODY OR

ADVISORY BODY

MULTI-ACADEMY: VA & VC/COMMUNITY ACADEMY CLUSTER

SCHOOL 1

LOCAL

GOVERNING

BODY OR

ADVISORY BODY

SCHOOL 2

LOCAL

GOVERNING

BODY OR

ADVISORY BODY

SCHOOL 4

LOCAL

GOVERNING

BODY OR

ADVISORY BODY

SCHOOL 3

LOCAL

GOVERNING

BODY OR

ADVISORY BODY

VC ACADEMY TRUST & COMMUNITY

DIRECTORS & MEMBERS

Governed by Articles & Funding Agreement

VA ACADEMY TRUST

DIRECTORS & MEMBERS

Governed by Articles & Funding Agreement

PARTNERSHIP AGREEMENT

THE LEGAL PROCESS OF CONVERSION – Property (2)

• The Interest in land passes to the AT

• Trust/Foundation Schools

• Community Schools

• VA and VC Schools

THE LEGAL PROCESS OF CONVERSION - Property (2)

• Identify land – the extent of it

• Investigate title – registered and non-registered information

• Check Trust document (VC + VA)

• Report on title etc

• Draft Transfer Deed/Lease/Supplemental Agreement

• Complete and register with the Land Registry

THE LEGAL PROCESS OF CONVERSION – Employment (3)

• Community Schools/VC Schools

LA AT

• Foundation/Trust Schools/VA Schools

• Governing Body AT

THE LEGAL PROCESS OF CONVERSION - Employment

• Staff protected from changes by TUPE for transition unless ‘economic’ technical or

organisational reasons entailing changes in the workforce.

• May need consultation if ‘material’ measures anticipated

• New staff not bound by School Teachers pay and conditions – beware 2 Tier

structuring

THE LEGAL PROCESS OF CONVERSION - Pensions

• Teachers = the same. Unfunded ‘pay as you go’ type scheme

• Support Staff = LGPS. AT takes on the liability for deficit and on-going

contributions

THE LEGAL PROCESS OF CONVERSION - Funding (4)

• Agreement between AT and Secretary of State

• ‘Bums on seats’

• Capital Grant, GAG, EAG

THE LEGAL PROCESS OF CONVERSION – Asset Transfer (5)

• A Commercial transfer agreement transferring non-property assets from LA AT

• AT going forward enters into contracts with suppliers in its own name

LAND AND PROPERTY IMPLICATIONS

• Trust Schools )) Freehold

• Foundation Schools )

• VA Schools ) Licence

• Community and VC Schools ) With LA Land ) Leasehold

LAND AND PROPERTY IMPLICATIONS - Leasehold

• Landlord and Tenant relationship within the objects clause of the M & A’s

• Key areas:• Use• Dealings• Insurance• Repair• CRC’s

LAND AND PROPERTY IMPLICATIONS SERVICES

• Academies can buy their services where they like; e.g. other LA, same LA, Private

providers.

• Academies can set up their own trading subsidiary company’s to supply other

Schools e.g. Catering

• Multi-academies can ‘self-supply’ e.g. maintenance provision

GOING FORWARD

• Increase in sponsored Academies

• Challenges and Opportunities for LA;s

• Education Act 2011

• September 2012 bottom 2 Ofsted gradings legally eligible for ministerial

intervention and ‘Academisation’

• They are here to stay!

THANK YOU