Legal update for colleges

Most college managers are preparing to wind down for the August period.  However, in the legal field there is still much happening.

Employment Law Update

From 29 July, a whole range of employment law changes came into force.  Compromise Agreements were rebranded and it will now cost Claimants money to bring Employment Tribunal claims.

Fees

As we reported last month fees have now come into play in the Tribunal forum.  This is part of the government’s plans to claw back some of the £84 million a year it costs to run the Tribunals Service.  It is predicted that the cost of bringing a claim will deter some Claimants but the changes are not all good news for employers who could find themselves on the receiving end of an order to reimburse the fees paid should the Claimant succeed in their tribunal claim.

Notwithstanding the availability of a fee remission system, the introduction of tribunal fees has been met with criticism and opposition (as previously reported) and is in the process of being challenged in the courts.  UNISON has won its right for the matter to be examined through a judicial review hearing, which will take place in October 2013.

Tribunal Rules

The new Employment Tribunals Rules came into force from 29 July 2013 and will apply to all claims, including those submitted before that date.  The changes will include the introduction of a paper sift of claim forms by Employment Judges who will be able to reject claims which: are not made on the prescribed form, do not contain the required information, are not accompanied by the fee or a fee remission application, are outside the tribunal’s jurisdiction, and those to which a Respondent cannot sensibly respond.  There will also be a duty on the parties and their representatives to co-operate with the Tribunal and with each other.

Settlement Agreements

Compromise Agreements are now known as “Settlement Agreements”.  This change is designed to put the emphasis on settling the dispute between the employee and employer rather than on the employee compromising their employment law rights.  Apart from some technical changes to “Compromise/Settlement Agreements”, however, the substance and form of the agreements will not change dramatically.

Pre-termination negotiations

From 29 July 2013, employers and employees will be able to discuss settlement offers and for those negotiations to be protected from being referred to in evidence in an ordinary unfair dismissal case unless there has been “improper behaviour”.  However, such discussions will still be able to be referred to in evidence in automatically unfair dismissals and discrimination or breach of contract claims.  ACAS has produced a Code of Practice on this but it will remain to be seen what effect the introduction of per-termination negotiations will have.  Many commentators consider that the changes will only create more caselaw through arguments as to what constitute improper behaviour as well as whether individuals will raise grievances as a result of negotiations deemed pre-termination.

Property Law Update

FE is no stranger to shops and restaurants on their patch.  However, colleges are increasingly allowing chains to be parked on their sites to make some money.  What are the commercial and/or practical implications of this and what should Colleges be aware of?

Colleges faced with budget cuts are under pressure to explore new ways of generating income. We have seen for example, the introduction of Costa Express self-serve coffee bars (which were launched in 2011 with the hope of being a big hit with students) and Costa Coffee shops on campuses, not to mention an abundance of ‘proud to serve Costa’ placards to entice us in to existing establishments which now serve Costa-branded products.  A report by the NUS in 2012 highlighted that students are after a ‘coffee experience’ and that there is a ‘buzz’ around branded coffee.

Whilst there may be financial benefits for Colleges to have such arrangements, there are many issues to take into account before entering into them.

Failing to Plan is Planning to Fail

Colleges which are considering allowing chains to operate on their premises must seek advice on whether they will need planning permission. Generally if any external alterations are required to buildings then planning permission will be required. Similarly if there is to be any frontage to the coffee shop then the college must seek advice as to whether advertising consent is required.  If the coffee shop is to be opened in part of an existing building and its use is ancillary to the primary use of the building then planning permission generally should not be required. There is a risk that if the general public have access to the coffee shop then arguably the use of the building as a coffee shop is no longer ancillary to its use as a place of education and planning permission may be required for a change of use. There are likely to be practical difficulties in how a College would exclude the public from using the coffee shop.

Colleges also need to consider whether they have the funds to maintain the building to meet their obligations and how they will manage this in the long term. Colleges ought to consider what rights they are granting to the coffee shop and what obligations they are placing on themselves. Chain coffee shops may not be willing to enter into an agreement unless they know that they are going to be on campus for a long time.

Lease or Licence?

Colleges which are thinking of allowing chain coffee shops or other catering outlets on campus should consider whether they are granting a lease or a licence and take advice as to the implications.

There is no doubt that there is potential for income generation by welcoming chains with strong brands onto campuses, however it is not a decision to be taken lightly.

Matt Kelly is a partner at Thomas Eggar, the law firm