MATs’ severance payments nudge £1m

MATs’ severance payments nudge £1m

Five of the biggest multi-academy trusts have made non-statutory severance payments to staff totalling £941,316 during the year to August 2014, their latest accounts reveal.

The largest payments were made by United Learning, Academies Enterprise Trust (AET), Harris Federation, Kemnal Academies Trust (TKAT) and Ark Schools.

Non-statutory severance payments – outside normal statutory or contractual requirements – are given to staff who resign, are dismissed, or reach an agreed termination of contract.

The figures came from the accounts for the multi-academy trusts (MATs) with more than 20 schools that have so far been published.

TKAT’s accounts show total severance payments of £759,000. Of this, £191,818 represented non-statutory payments. TKAT made 13 separate payments; the largest was £30,229.

A spokesperson for TKAT, who run more than 40 academies in London and the south of England, said: “Severance payments are calculated on an individual basis with employees and vary by school, depending on contractual agreements and other criteria. Therefore comparisons between schools, trusts and years cannot be done with any accuracy.

“Our severance payments are subject to both internal and external audit, and we are satisfied, as is the EFA [Education Funding Agency], that our decisions are in line with the Academies Financial Handbook and represent value for money.”

Academy trusts must disclose all non-statutory staff severance payments in their audited accounts. Government guidance states that academy trusts must obtain Secretary of State prior approval for non-statutory or non-contractual payments of £50,000 or more.

The EFA Handbook also says that when academy trusts are considering making payments above the statutory or contractual entitlements, they must consider whether such payments are justified based on a legal assessment of the chances of the trust successfully defending the case at employment tribunal.

AET, which runs 69 schools, made non-statutory severance payments totalling £270,968. A spokesperson for the trust said: “The payments are settlement costs with staff who have left the organisation. As the country’s largest multi-academy trust we have more than 6,000 employees and the costs represent a very small percentage of our overall staff budget.”

Ark Schools operates 27 primary, secondary and all-through academies in London, Portsmouth, Hastings and Birmingham. It made non-statutory payments of £189,286. A spokesperson for Ark said: “We employ more than 2,000 staff across our schools so over the course of a year there will inevitably be a number of severance payments. These may cover payments agreed prior to TUPE transfer when a school joins our network, or which we make on legal advice to avoid further costs through potential litigation.

“We seek to minimise the costs of such payments wherever possible, while fulfilling our obligations to our staff. To put these figures into context, we grew from 18 to 27 schools in this period, and the amounts are comparable to other multi-academy trusts.”

Jon Richards, Unison’s national secretary education and children’s services, told Schools Week: “The increase in these payments highlights a big increase in restructuring and redundancies in MATs . . . more so than in maintained schools.

“Many MATs face financial challenges because they don’t have the same level of economies of scale as local authority-run schools. We need to look at the capacity of some MATs to manage schools in the current economic climate.”