This is the first article in a two-part series on contractors in schools. In this series, Jonathan Oliver, Senior Business Consultant at CompliSpace, investigates the legal relationship between schools and contractors. Part One includes an analysis of the content of contracts, the duty of care schools owe and staff responsibilities and intervention.

Contract for service vs contract of service

Schools use contractors for a wide range of services. In simple terms, a contractor is a person who is engaged in a contract for services – he or she is contracted to provide specific services to the school. The other type of engagement is what is known as a 'contract of service' – or what is known as the employer/employee relationship. It is not always easy to determine which type of relationship applies to a particular set of facts. Indeed courts have deliberated on this distinction between contractors and employees extensively. Is the person a “contractor or employee?”

The Fair Work Ombudsman has provided guidance on this issue. This question is a significant one, as under employment laws different rights and entitlements, taxation, superannuation and other rights and responsibilities may apply depending on the determination of a party as an employee or a contractor.

Beyond the employment contract situation, many schools use independent contractors to provide a range of services to the school. Some examples include canteen services, sports coaching, camping and outdoor education programs and bus transport services to name a few.

What should be included in a contract to provide services to a school?

This will vary enormously depending on the type of contract. Schools may decide to obtain legal advice when contracting for major contracts for services such as the provision of food and beverage, or cleaning services to the school, or the operation of sports facilities such as swimming centres that may be open to the public at certain times.

In general, to clarify the roles and responsibilities of both the school and the contractor, a written contract avoids ambiguity. This is important even for relatively minor contracts, as well as for more extensive agreements that we have mentioned above. The contract will generally cover the following important terms:

• a description of the services to be provided;
• contractor staff qualifications and experience;
• staff ratios;
• copies of safety and risk management documents;
• equipment supplied and quality of same;
• electrical and chemical safety matters;
• times and locations of activities;
• insurance (public liability);
• price and payment method/timing;
• induction and safety issues include emergency management, evacuation and lockdown (if applicable);
• injuries and first aid;
• the discipline of students;
• compliance with existing laws (including licensing);
• Working With Children Check requirements for contractor staff; and
• liaison and reporting of incidents and near misses, including a requirement for the contractor staff to provide incident reports to the school.

In light of increasing child protection legal obligations, schools may also require the contractor to acknowledge that they have read the school's child protection policies and codes of conduct and will abide by them.

Contractors, schools and duty of care

Schools have a non-delegable duty of care  towards their students. This simply means that the school will always have a duty of care despite any attempt to exclude this obligation. This also means that schools cannot ‘contract out’ their duty of care where they include terms to that effect in a contract for service with a third party provider. When schools use specialist contractors to run programs, they are not outsourcing their duty to take reasonable care to ‘the professionals'. The opposite is the case – schools are using trained professionals to ensure that reasonable care is taken because the school does not have the necessary skills and qualified staff available.

Checking the qualifications and experience of the contractor before engaging them is very important.  This is a form of 'due diligence'.

If a contractor behaves in a negligent manner a school may be liable in two ways. Firstly because it has a non-delegable duty of care and secondly, because it has failed to ensure the contractor has the appropriate qualifications and experience to run the activity safely. If a school has checked the qualifications and experience of the contractor then it may be able to argue that it has taken all reasonable care and was acting in a way that any reasonable school would act in similar circumstances.

In the case of Introvigne (Introvigne v Commonwealth of Australia (1980) 32 A.L.R. 251) a boy was injured after playing with a flag pole at the school. A piece of the pole fell on his head. The school was run by the NSW Government on behalf of the Commonwealth. One of the questions in the case was whether the Commonwealth was liable for the negligent acts or omissions of the contractor – in this case, the State of NSW. The High Court said that the Commonwealth could not discharge their duty of care by arranging the State of NSW to run the school. The Court said that it had a responsibility to see that adequate supervision was provided and the absence of adequate supervision meant that it had not fulfilled its responsibility and was in breach of its duty of care.

Conclusion

Schools are able to derive value for students and the school community through excursions and extracurricular activities as well as through the management of the school property and grounds by using contractors. It is not always practical for teachers and employees to be in charge of these activities. However, there are risks associated with taking on contractors as we have seen. Ultimately, schools must be aware of the duty of care they owe to students regardless of any contract arrangements they have undertaken.

In part two of this series we will consider workers compensation, WHS laws, as well as taking a closer look at two cases that will shed light on this important issue.