Lambeth Teacher with Lambeth NUT

FAIR FUNDING : COMMERCIAL INSURANCE SCHEMES FOR SUPPLY COVER

Another fine LMS .....

Circular No. 68/01(H&S)

Date: 30 May 2001

To: Secretaries of Divisions and Local Associations – FOR INFORMATION AND ACTION

Dear Colleague

Attached to this circular is a briefing setting out Union policy on the use of commercial insurance schemes to provide cover for long-term sickness absence. It reminds divisions and associations of the current funding framework as it affects the funding of supply cover for long-term sickness absence.

Since LMS, there has been a decrease in the percentage that the LEA has been allowed to fund centrally, which in itself forced upon many authorities the need to dispense with their Supply Pool - teachers employed centrally who were perhaps the A Team going into schools in need.

In the past two years, it has been mandatory for lEAs to delegate the funding to schools, with the possibility of 'buy back'. (see below)

However, some schools have embarked on worthless or costly insurance schemes which have filled the coffers of the insurance companies but have provided nothing in the schools. They all ahd the famous clause that the policy was invalid in the case of a teacher being ill for more than 21 days and didn't cover the first 20 days. That sort of thing.

The union advice on the left is therefore important to take note of. The feature below is the position we were in in June 2001 with our LEA.

Advice to Divisions and Associations

In order to protect teachers from the effects of commercial insurance schemes for supply cover and referring to the enclosed document:

(a) divisions should seek to persuade LEAs to retain funding for long-term sickness absence as permitted and also to establish their own ‘buy-back’ insurance schemes for sickness absence cover and seek to ensure all schools are made aware of and participate in these schemes;

(b) divisions and associations should be aware of possible unacceptable provisions in commercial insurance schemes and the Union’s advice as set out above on these; and

(c) divisions should urge LEAs to advise teachers of their rights under the Access to Medical Reports Act 1988 to withhold consent to their medical records being supplied to an insurance company and to see a medical report before it is supplied to an insurance company.

FAIR FUNDING : COMMERCIAL INSURANCE SCHEMES FOR SUPPLY COVER

A BRIEFING FOR DIVISIONS AND ASSOCIATIONS

BACKGROUND

Since April 1999, LEAs have been required to delegate funding for supply cover for long-term sickness absence to schools. The only exception to this rule is that LEAs are permitted by the DfEE to hold funding centrally if they so choose to a maximum of 0.1 per cent of the Local Schools Budget (LSB) to pay for sickness supply cover for absences of 21 days or more. Where LEAs do so, the DfEE has advised that the criteria for assistance will be for LEAs themselves to draw up but that the aim should be to assist schools which are in difficulties caused by the cost of cover, despite good absence management.

LEA Schemes for Supply Cover

NUT advice continues to be that, since funding for supply cover cannot now be retained centrally, LEAs should be pressed to offer schools ‘buy-back’ arrangements in the form of a centrally-organised LEA “insurance” scheme. ‘Buy-back’ arrangements are particularly advisable for costs of supply cover for long term sickness, should the LEA decline to retain funding for this, since schools’ liabilities are likely to be uneven and/or difficult to predict. Participation by all schools in LEA ‘buy-back’ arrangements would help to spread the risk involved in the delegation of this funding to all schools.

Supply Cover in Lambeth

Under LMS, supply cover was effectively privatised as LEA’s were unable to maintain a supply pool which was centrally funded. This led to a growth in insurance premiums to commercial concerns and the mushrooming of agencies. Teachers’ pay packets were not enhanced.

The recent crisis highlighted, against the popular myth that private enterprise is more efficient, the failings of the present system.

The LEA have agreed to approach Secondary heads, in the first instance, to consider the feasibility of a ‘buy back’ system which establishes an LEA supply pool.

The unions give full support to this initiative and ask all members to encourage similar enthusiasm from their headteachers.

We await developments here - watch this virtual space!

Commercial Insurance Schemes for Supply Cover : Why the NUT Opposes Such Schemes

Where no ‘buy-back’ arrangements for supply cover funding exist, schools are increasingly turning to commercial insurance companies to seek to protect themselves against the cost of long-term absence.

The Union continues to believe that the use of commercial insurance schemes for supply cover contains significant risks. Governing bodies may take out policies which are inappropriate. They may lack the experience to take full account of the possible effects of exclusion clauses included by insurers. In addition, they might opt for the cheapest policy which is unlikely to be the best. Such a choice might represent a false economy since the school might discover, at a later stage, that the policy does not meet its needs.

Commercial insurance schemes may also seek to exclude teachers with poor health records. This may place such teachers under unacceptable pressure not to be absent on long-term sick leave or result in over-zealous use of absence monitoring procedures.

Certain commercial insurance schemes for supply cover include provisions which seek to impose requirements upon teachers which go beyond the requirements of the Burgundy Book Sick Pay Scheme. For example, teachers have been asked to allow insurers access to their medical records, to supply medical reports at their own cost and to fill in detailed forms for insurers. The Burgundy Book provisions for sick leave do not include any such obligations as a condition for entitlement to sick pay. The Union advises that teachers should decline such requests which are a matter for resolution between the school and insurer.