Could Nurseries Face Legal Action for Lockdown Fees

Private nurseries are being warned that they could face legal fees if they still charge parents their regular fees even when lockdown prevents children from attending.

Pre-schools, nurseries and childminders who charged their customers the usual fees for attendance during the national lockdown are facing rising pressure from parents to offer refunds, after the Competitions and Markets Authority said that it was unfair to charge where services hadn’t been provided.

The Competitions and Markets Authority penned an open letter to the sector this week, saying that legal action was likely to follow where unfair and illegal fees had been levied during the peak of Covid-19’s pandemic restrictions.

The watchdog pointed to unfair practices including threatening closure or saying that children would lose their place if parents didn’t pay. However, angry nursery owners have said that they were forced to ask for parental support during the three month lockdown, as they would have otherwise struggled to survive.

Many in the early years sector believe that they should have received a stronger package of government support.

The CMA said that its open letter was designed to flag up the key points of contractual obligations and consumer law, and to ensure that early years providers recognised the rights of their customers during the lockdown period. Whilst they acknowledged that parents should have been in a position to keep paying for their nursery places if they wished to – whilst being unable to send their children – they should never have been pressured with emotional tactics and threats; however low-key.

The CMA set up a Covid-19 response taskforce in March which was charged with monitoring the market’s developments as the pandemic unfolded and to flag up any unfair commercial practices which could harm consumers.

The industry body said that it had received reports that nurseries were operating in unfair ways, primarily in relation to cancellations and requests for ongoing payments during the lockdown period. The topic is likely to continue to unfold as parents grapple with charges during enforced periods of Covid isolation, particularly if any test cases are brought to court.

It’s certainly true that nurseries and other early years settings have struggled with the challenge of meeting ongoing costs such as rent and bills when they were forced to close. Many are now keen to invest in their businesses and to secure their success for the longer-term – whether that’s to take on new staff, to train their teams or to upgrade their premises.

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