How much additional responsibility and liability is involved for the governing body and how is it protected/insured?
The academy trust (a charitable company limited by guarantee) is the legal entity that will be responsible for the running of the school and entering into contracts. The academy trust will be able to take out employers’ liability insurance (like any other employer of staff). Liabilities to external parties would ordinarily be those of the academy trust (a company with a separate legal entity and not the governors themselves). Under the articles of association, the academy trust is required to provide indemnity insurance to cover the liability of its governors. The members of the academy trust will be liable to contribute up to £10 if the academy trust is wound up. As the academy trust is a charitable company, the governors are also directors and charitable trustees, and will therefore need to comply with obligations under company and charity law.
