Appendix 1 legal requirements - early years' provider agreement

Early years' provider agreement effective from 1 January 2025. Appendix legal requirements.

1. Duration of the agreement

1.1. This agreement shall commence on the commencement date and unless terminated earlier in accordance with the terms of this agreement shall remain in force.

2. Provision of the services

2.1. The provider shall provide the services during the term subject to, and in accordance with the terms of this agreement, including, without limitation, the provisions of the service specification and the statutory guidance.

2.2. Without prejudice to the provisions of the service specification and the rest of this agreement, the provider shall provide the services with effect from the commencement date.

3. Standard of performance

3.1. Without prejudice to the generality of clause 3.3 the provider will at all times ensure that the services comply with and meet all the requirements of this agreement, the service specification, the statutory guidance, the EYFS statutory framework and all applicable local authority policies and law with effect from the commencement date.

3.2. The provider shall ensure that at all times the services are performed by appropriately qualified and trained personnel.

3.3. The provider shall at all times in connection with this agreement act in:

• 3.3.1. good faith in the best interests of the local authority
• 3.3.2. accordance with good industry practice
• 3.3.3. accordance with all relevant law

3.4. The provider warrants that it is eligible to be included on the Directory of Providers.

3.5. In the event that the provider ceases to be eligible, the provider shall immediately notify the local authority and the local authority shall have the right to suspend the provider from the Directory of Providers and may terminate this agreement.

3.6. Unless otherwise permitted by the local authority, the provider shall only deliver the services:

• 3.6.1. in respect of children eligible for the 2-year-old assessment-based funding
  1. where the provider is an early years' provider or a childminder and is awarded a grade of 'good' or higher by Ofsted; or
  2. where the provider registered with a childminder agency and the childminder agency is judged 'effective' by Ofsted,
  in the most recent early years provision inspection report published by Ofsted in respect of the provider/childminder agency.
• 3.6.2. in respect of children eligible for the weekly funded hours (universal) or working parent entitlements:
  1. where the provider is an early years' provider or a childminder and is awarded a grade of 'requires improvement' or higher by Ofsted; or
  2. where the provider is registered with a childminder agency and the childminder agency is judged 'effective' by Ofsted,
  in the most recent early years provision inspection report published by Ofsted in respect of the provider/childminder agency.

3.7. Notwithstanding clause 3.6 where the provider is an early years provider, childminder or agency childminder who only provides early years childcare exclusively for children at the beginning or end of the school day or in school holiday periods the provider shall only deliver the services where the provider or childminder agency as applicable is awarded a grade of 'met' by Ofsted in the most recent early years provision inspection report published by Ofsted in respect of the provider or childminder agency as applicable.

3.8. Where:

• 3.8.1. the provider is an early years' provider or a childminder and is newly registered with Ofsted; or
• 3.8.2. the provider is an agency childminder and the childminder agency and is newly registered with Ofsted

the provider shall only deliver the services in respect of children under statutory school age until the first full Ofsted inspection judgement is published of the provider or the childminder agency as applicable.

3.9. The provider shall immediately notify the local authority if there is any change to the grade awarded by Ofsted to the provider during the term.

3.10. In the event that the providers grade is lower than the grade or grades required under clause 3.6 or 3.7, the local authority shall have the right to terminate this agreement in accordance with clause 13.

3.11. If during the term, national registration bodies or requirements change, the provider is required to ensure compliance with the new standards and respond to changes in any related legislation.

4. Funding

4.1. In consideration of the provider's performance of its obligations under this agreement, the local authority shall pay the provider the early years' entitlement funding in accordance with the terms of this agreement.

4.2. The early years' entitlement funding shall be paid by the local authority in accordance with service specification.

4.3. Without prejudice to the local authority's other rights and remedies, the local authority may, at its absolute discretion, withhold, suspend, withdraw and/or require repayment of all or part of the early years' entitlement funding:

• 4.3.1. if the early years' entitlement funding is no longer available for any reason
• 4.3.2. if the provider fails to grant to the local authority a right of reasonable access to the setting as and when reasonably required
• 4.3.3. and undertake a rolling programme of checks to verify the headcount data provided if the provider has over-claimed funding from the local authority, and fails to remedy the breach within 10 working days of receipt of written notice by the local authority
• 4.3.4. if the provider fails to submit the claim forms or monitoring information as required by the local authority by the date specified by the local authority
• 4.3.5. if there are any outstanding payments owed to the local authority by the provider under this agreement or any other agreement including but not limited to payments in respect of rent and the provider fails to make payment of the same within 10 working days of written notice by the local authority
• 4.3.6. if the provider is in breach of any statutory requirement, including but not limited to any breach of the statutory guidance, the EYFS statutory framework or any other applicable law
• 4.3.7. relating to any period of service suspension
• 4.3.8. relating to any period during which the provider was not eligible
• 4.3.9. relating to any period during which the provider was in breach of the directory conditions
• 4.3.10. relating to any period during which the provider was suspended from the Early Years Register by Ofsted.
• 4.3.11 For any reason as expressly set out in the service specification of this agreement

4.4. If the local authority makes an overpayment of funding to the provider for whatever reason including as a result of an administrative error or otherwise the provider shall promptly repay such overpayment to the local authority upon request.

4.5. The provider is wholly responsible for the accuracy of all claims submitted to the local authority for funding and the local authority accepts no liability in respect of any losses incurred by the provider as result of any failure by the provider to submit a claim either accurately or at all.

4.6. The local authority is permitted by Department for Education (DfE) to charge providers financial penalties when providing late or incomplete information. However, the local authority shall not charge providers disproportionate penalties for providing late or incomplete information leading to additional administration in the processing of funded entitlements. Any charges should be reasonable and proportionate to the inconvenience or costs incurred to the local authority as a result of the lateness and the local authority will ensure charges are clearly communicated to providers. The local authority shall notify providers in writing in advance of any charges it proposes to implement for the late or incomplete submission of information.

4.7. The provider shall make any payments due to the local authority promptly and without any deduction whether by way of set-off, counterclaim, discount, abatement or otherwise.

5. Liability and indemnity

5.1. Neither party excludes or limits the liability to the other party for:

• 5.1.1. death or personal injury caused by its negligence
• 5.1.2. fraud or fraudulent misinterpretation, or
• 5.1.3. any claims for which liability may not otherwise lawfully be limited or excluded

5.2. Subject to clause 5.1, in no event shall either party be liable to the other party under contract, negligence or otherwise for any direct or indirect losses including:

• 5.2.1. loss of profits
• 5.2.2. loss of sales
• 5.2.3. loss of turnover
• 5.2.4. loss of opportunity
• 5.2.5. loss of anticipated savings; or
• 5.2.6. loss of goodwill, even if the loss was reasonably foreseeable, or either party has been advised of the possibility of such damages

5.3. Neither party shall be liable for any injury, loss, damage, cost or expense if and to the extent that it is caused by the negligence or wilful misconduct of the other party.

5.4. Subject to clauses 5.1, 5.2, 5.3 and 10.19 the provider shall indemnify and keep indemnified the local authority against all claims, proceedings, actions, damages, costs, expenses and all other liabilities which may arise out of, or in consequence of, the supply or delivery, or the late or purported supply or delivery, of the services or the performance or non-performance by the provider of its obligations under this agreement, including in respect of any death or personal injury, loss of or damage to property, or any other loss which is caused directly or indirectly by any act, omission or negligence of the provider or its employees or agents.

5.5. Subject to clauses 5.1, 5.2, 5.3 and 10.19 the local authority's total aggregate liability, in addition to its obligation to pay the funding as and when payment of the funding shall fall due, shall be limited to one hundred per cent (100%) of the aggregate annual funding paid, due or which would have been payable under this agreement in the 12-month period immediately preceding the event giving rise to liability (or if such event occurs in the first 12 months of the term, the amount estimated to be paid in the first 12 months.

6. Insurance

6.1. The provider shall take out and maintain with a reputable insurance underwriter or companies a policy or policies of insurance which are adequate to cover its liability under this agreement, and any other insurances required to comply with the law for the duration of the term. These insurances must be effective in each case not later than the date on which the relevant risk commences.

6.2. The insurances referred to in clause 6.1 shall include but not be limited to the following, in each case for any one occurrence or services of occurrences arising out of one event:

• 6.2.1. public liability insurance to the minimum value of £10,000,000
• 6.2.2. employers liability insurance to the minimum value of £10,000,000

6.3. In addition, it is recommended by the local authority that the provider purchases theft by employee cover to the value of £25,000 per annum.

6.4. The provider shall provide to the local authority on request, copies of all insurance policies referred to in this clause 6 or a brokers verification of insurance to demonstrate the appropriate cover is in place, together with receipts or other evidence of payment or the latest premiums due under those policies.

6.5. The provider shall not take any action or fail to take any reasonable action, or permit anything to occur, which would entitle any insurer to refuse to pay any claim under any insurance policy referred to in clause 6.1.

7. Intellectual property rights

7.1. All intellectual property rights:

• 7.1.1. owned by the local authority before the commencement date or developed by the local authority during the term shall remain the property of the local authority
• 7.1.2. owned by the provider before the commencement date shall remain the property of the provider
• 7.1.3. developed or created by the provider during the term that relate to the services shall belong to the provider

7.2. Where the local authority has provided the provider with any of its intellectual property rights for use in connection with the services (including without limitation its name and logo) the provider shall cease to use such intellectual property rights immediately upon termination of this agreement and shall either return or destroy such intellectual property rights as requested by the local authority.

8. Confidentiality

8.1. In respect of any confidential information it may receive from the other party ('the discloser') or which has come to either party's knowledge in the course of providing the services and subject always to the remainder of this clause 8, each party undertakes to keep secret and strictly confidential and shall not disclose any such confidential information to any third party save for the proper performance of this agreement or with the discloser's prior written consent.

8.2. Where disclosure is made by the provider to any employee, consultant, adviser or agent, it shall be made subject to obligations equivalent to those set out in this agreement. The provider shall procure that any such employee, consultant, adviser or agent complies with all those obligations. The provider shall be responsible to the local authority in respect of any disclosure or use of any confidential information by a person to whom disclosure is made.

8.3. The provisions of clause 8.1 shall not apply to any confidential information which:

• 8.3.1. is in or enters the public domain other than by breach of this agreement or other act or omissions of the provider
• 8.3.2. is obtained by a third party who is lawfully authorised to disclose such information
• 8.3.3. is authorised for release by the prior written consent of the discloser
• 8.3.4. the disclosure of which is required to ensure the compliance of the local authority with the Freedom of Information Act 2000 (the 'FOIA') the Environmental Information Regulations (the 'EIR') or the Local Government Transparency Code
• 8.3.5. the local authority may, at its sole discretion, elect to publish this agreement (including any variations to this agreement) in its entirety

8.4. Nothing in this clause 9 shall prevent the provider from disclosing confidential information where it is required to do so by judicial, administrative, governmental or regulatory process in connection with any action, suit, proceedings or claim or otherwise by applicable law or, provided that the information is subject to confidentiality undertakings equivalent to those set out in clause 8.1, to its professional advisors or insurers.

9. Freedom of information

9.1. The provider acknowledges that the local authority is subject to the requirements of the Code of Practice on Government Information, FOIA and the EIR and shall assist and co-operate with the local authority to enable the local authority to comply with its information disclosure obligations.

9.2. The provider shall:

• 9.2.1. transfer to the local authority all requests for information that it receives as soon as practicable and in any event within 2 working days of receiving a request for information
• 9.2.2. provide the local authority with a copy of all Information in its possession or power (being information held by the provider on behalf of the local authority) in the form that the local authority requires within 5 working days of the local authority's request (or such other period as the local authority may specify)
• 9.2.3. provide all necessary assistance as reasonably requested by the local authority to enable the local authority to respond to the Request for Information within the time for compliance set out in Section 10 of the FOIA or Regulation 5 of the EIR

9.3. The local authority shall be responsible for determining at its absolute discretion whether the information:

• 9.3.1. is exempt from disclosure in accordance with the provisions of the FOIA or the EIR
• 9.3.2. is to be disclosed in response to a request for information

9.4. In no event shall the provider respond directly to a request for information unless expressly authorised to do so by the local authority.

9.5. The provider acknowledges that the local authority may, acting in accordance with the Department of Constitutional Affairs' Code of Practice on the Discharge of the Functions of Public Authorities under Part 1 of FOIA, be obliged in certain circumstances and/or following consultation with the provider to disclose information without consulting or obtaining consent from the provider, or despite having taken the providers views into account, provided that the local authority shall, in accordance with any recommendations of the code, take reasonable steps, where appropriate:

• 9.5.1. to give the provider advanced notice, or failing that
• 9.5.2. to draw the disclosure to the providers attention after any such disclosure

10. Data protection

10.1. The provider shall ensure that the services comply with the requirements of the data protection legislation governing the collection, store and/or use of personal data.

10.2. The parties acknowledge that for the purposes of the data protection legislation, the provider is the controller and the local authority is the processor. The only processing that the local authority is authorised to do is listed in the data processing schedule by the provider and may not be determined by the local authority.

10.3. The provider shall comply at all times with all requirements under the data protection legislation and both parties shall duly observe all their obligations under the data protection legislation, which arise in connection with this agreement.

10.4. Whenever the provider collects and shares personal data, it shall issue a privacy notice ('PN') to the data subject, stating what personal data is being shared, and for what purpose. Where the data subject is a child, the PN must be issued to the parent of the child.

10.5. The local authority shall notify the provider as soon as reasonably practicable if it considers that any of the providers instructions infringe the data protection legislation.

10.6. The local authority shall provide all reasonable assistance to the provider in the preparation of any data protection impact assessment prior to commencing any processing. Such assistance may, at the discretion of the provider, include:

• 10.6.1. a systematic description of the envisaged processing operations and the purpose of the processing
• 10.6.2. an assessment of the necessity and proportionality of the processing operations in relation to the services
• 10.6.3. an assessment of the risks to the rights and freedoms of data subjects; and
• 10.6.4. the measures envisaged to address the risks, including safeguards, security measures and mechanisms to ensure the protection of personal data

10.7. The local authority shall, in relation to any personal data processed in connection with its obligations under this agreement:

• 10.7.1. process that personal data only in accordance with the data processing schedule unless the local authority is required to do otherwise by law. If it is so required, the local authority shall promptly notify the provider before processing the personal data, unless prohibited by law
• 10.7.2. ensure that it has in place protective measures as appropriate to protect against a data loss event having taken account of the:
  1. nature of the data to be protected
  2. harm that might result from a data loss event
  3. state of technological development
  4. cost of implementing any measures
• 10.7.3. ensure that:
  1. the local authority personnel do not process personal data except in accordance with this agreement (and in particular, the data processing schedule)
  2. it takes all reasonable steps to ensure the reliability and integrity of any local authority personnel who have access to the personal data and ensure that they:
     
     1. are aware of and comply with the local authority's duties under this clause
     2. are subject to appropriate confidentiality undertakings with the local authority or any sub-processor
     3. are informed of the confidential nature of the personal data and do not publish, disclose or divulge any of the personal data to any third party unless directed in writing to do so by the provider or as otherwise permitted by this agreement
     4. have undergone adequate training in the use, care, protection and handling of personal data
• 10.7.4. not transfer personal data outside of the EU unless the prior written consent of the provider has been obtained and the following conditions are fulfilled:
  1. the local authority or the provider has provided appropriate safeguards in relation to the transfer (whether in accordance with UK GDPR Article 46 or Law Enforcement Directive Article 37) as determined by the provider
  2. the data subject has enforceable rights and effective legal remedies
  3. the local authority complies with its obligations under the data protection legislation by providing an adequate level of protection to any personal data that is transferred (or, if it is not so bound, uses its best endeavours to assist the provider in meeting its obligations)
  4. the local authority complies with any reasonable instructions notified to it in advance by the provider with respect to the processing of the personal data
• 10.7.5. at the written direction of the provider, delete or return personal data (and any copies of it) to the provider on termination of the agreement unless the local authority is required by law to retain the personal data.

10.8. Subject to clause 10.9, the local authority shall notify the provider immediately if it:

• 10.8.1. receives a data subject access request (or purported data subject access request)
• 10.8.2. receives a request to rectify, block or erase any personal data
• 10.8.3. receives any other request, complaint or communication relating to either party's obligations under the data protection legislation
• 10.8.4. receives any communication from the Information Commissioner or any other regulatory authority in connection with personal data processed under this agreement
• 10.8.5. receives a request from any third party for disclosure of personal data where compliance with such request is required or purported to be required by law
• 10.8.6. becomes aware of a data loss event

10.9. The local authority's obligation to notify under 10.8 shall include the provision of further information to the provider in phases, as details become available.

10.10. Taking into account the nature of the processing, the local authority shall provide the provider with full assistance in relation to either party's obligations under data protection legislation and any complaint, communication or request made under clause 10.8 (and insofar as possible within the timescales reasonably required by the provider) including by promptly providing:

• 10.10.1. the provider with full details and copies of the complaint, communication or request
• 10.10.2. such assistance as is reasonably requested by the provider to enable the provider to comply with a data subject access request within the relevant timescales set out in the data protection legislation
• 10.10.3. the provider, at its request, with any personal data it holds in relation to a data subject
• 10.10.4. assistance, as requested by the provider, following any data loss event
• 10.10.5. assistance, as requested by the provider, with respect to any request from the Information Commissioner's Office, or any consultation by the provider with the Information Commissioner's Office

10.11. The local authority shall maintain complete accurate records and information to demonstrate its compliance with this clause. This requirement does not apply where the local authority employs fewer than 250 staff, unless:

• 10.11.1. the provider determines that the processing is not occasional
• 10.11.2. the provider determines the processing includes special categories of data as referred to in Article 9(1) of the UK GDPR, or personal data relating to criminal convictions and offences referred to in Article 10 of the UK GDPR
• 10.11.3. the provider determines that the processing is likely to result in a risk to the rights and freedoms of data subjects

10.12. The local authority shall allow for audits of its data processing activity by the provider or the provider's designated auditor.

10.13. The local authority shall designate a data protection officer if required by the data protection legislation.

10.14. Before allowing any sub-processor to process any personal data related to this agreement, the local authority must:

• 10.14.1. notify the provider in writing of the intended sub-processor and processing
• 10.14.2. obtain the written consent of the provider
• 10.14.3. enter into a written agreement with the sub-processor which give effect to the terms set out in this clause, such that they apply to the sub-processor
• 10.14.4. provide the provider with such information regarding the sub-processor as the provider may reasonably require

10.15. The local authority shall remain fully liable for all acts or omissions of any sub-processor.

10.16. Either party may, at any time on not less than 30 working days' notice, with the consent of the other party not to be unreasonably withheld or delayed, revise this clause 10 by replacing it with any applicable controller to processor standard clauses or similar terms forming part of an applicable certification scheme (which shall apply when incorporated by attachment to this agreement).

10.17. The parties agree to take account of any guidance issued by the Information Commissioner's Office. The local authority may, on not less than 30 working days' notice to the provider, amend this agreement to ensure that it complies with any guidance issued by the Information Commissioner's Office.

10.18. The provider shall indemnify the local authority against all losses suffered or incurred by the local authority arising out of or in connection with the provider's breach of its obligations under this clause 10, including without limitation, any third party demand, fines, penalties, claim or action, or any breach of contract, negligence, fraud, wilful misconduct, breach of statutory duty or non-compliance with any part of the data protection legislation by the provider, its employees, servants, agents or its sub-contractors.

10.19. The local authority's total aggregate liability arising under this agreement in respect of any breach of this clause 10 shall be limited to £1,000,000. This limitation applies regardless of the form of action whether in contract or in tort, including without limitation negligence, or otherwise.

11. Disclosure and barring

11.1. The provider shall procure that, in respect of all potential employees or persons performing any of the services which for the avoidance of doubt shall include all committee members of the provider (each a 'named employee') or before a named employee begins to perform any of the services:

• 11.1.1. each named employee is questioned as to whether he or she has any convictions
• 11.1.2. the results are obtained of a check of the most extensive available kind made with the Disclosure and Barring Service in respect of each named employee
• 11.1.3. to the extent permitted by law a copy of the results of such checks as are referred to in clause 11.1.2 are notified to the local authority, upon request

11.2. The provider shall procure that no person who appears on a barred list following the results of a Disclosure and Barring Service check shall be employed or engaged in the performance of the service.

11.3. The provider shall procure that no person who discloses any convictions or CBOs or who is found to have any convictions or CBOs following the results of a Disclosure and Barring Service check, is employed or engaged without the local authority's prior written consent (such consent not to be unreasonably withheld or delayed).

11.4. In so far as permitted by law, the provider shall procure that the local authority (local authority designated officer – LADO) is kept advised at all times of any provider personnel who, subsequent to their commencement of engagement pursuant to this agreement:

• 11.4.1. receives a conviction or CBO which become known to the provider or whose previous convictions or CBO become known to the provider
• 11.4.2. in respect of whom information is referred to the Disclosure and Barring Service pursuant to the Disclosure and Barring Scheme
• 11.4.3. who is placed on a barred list pursuant to the Disclosure and Barring Scheme

11.5. In the event that any provider personnel is added to a barred list, the provider shall procure that such person is immediately removed from the local authority premises and/or shall cease to be engaged in the performance of the services.

11.6. The provider shall ensure that all checks undertaken in accordance with clause 11.1 shall comply with all relevant policies and procedures of the Derbyshire Local Safeguarding Board.

12. Safeguarding

12.1. The local authority and the provider acknowledge that this agreement is for services which include the provision of a regulated activity within the meaning of the Safeguarding Vulnerable Groups Act 2006. The provider is a regulated activity provider with responsibility for the management and control of the regulated activity provided under this agreement and for the purposes of the Safeguarding Vulnerable Groups Act 2006.

12.2. The provider shall:

• 12.2.1. ensure that all individuals engaged in regulated activity are subject to a valid enhanced disclosure check for regulated activity undertaken through the Disclosure and Barring Service or such other checks as may be required by law from time to time
• 12.2.2. regularly monitor the level and validity of the checks required under this clause 12 for each provider personnel
• 12.2.3. not employ or use the services of any person who is barred from, or whose previous conduct or records indicate that they would not be suitable to carry out regulated activity or who may otherwise present a risk to users of the service

12.3. The provider warrants that at all times for the purposes of this agreement it has no reason to believe that any person who is or will be employed or engaged by the provider in the provision of the services is barred from the activity in accordance with the provisions of the Safeguarding Vulnerable Groups Act 2006 and any regulations made thereunder, as amended from time to time.

12.4. The provider shall immediately provide the local authority with any information which it requests to enable it to be satisfied that the obligations of this clause 12 have been met.

12.5. The provider shall immediately notify the local authority in writing in the event that it receives information about any person, or has a reasonable belief in relation to any person carrying out the services that such person has harmed or poses a risk of harm to users of the service and shall immediately suspend that person from carrying out their duties in relation to this agreement until the local authority has agreed (in its absolute discretion) that such person may return to their duties.

12.6. If the local authority is of the reasonable belief that a person engaged in carrying out services to which this clause 12 applies has harmed or poses a risk of harm to users of the service, it may demand that the provider removes that person from the provision of services under this agreement at no cost to the local authority.

12.7. The provider shall refer information about any person carrying out the services to the Disclosure and Barring Service where it removes permission for such person to carry out the services (or would have, if such person had not otherwise ceased to carry out the services) because, in its opinion, such person has harmed or poses a risk of harm to the users of the service.

12.8. The local authority has the right to withdraw funding and terminate this agreement immediately following written notice if it becomes aware of a breach by the provider.

13. Termination

13.1. Without affecting any other right or remedy available to it, the local authority may terminate all or part of this agreement with immediate effect by giving written notice to the provider if:

• 13.1.1 the provider commits a material or persistent breach of any term of this agreement and (if such breach is remediable) fails to remedy that breach within a period of 10 working days after being notified in writing to do so
• 13.1.2 the provider repeatedly breaches any of the terms of this agreement in such a manner as to reasonably justify the opinion that its conduct is inconsistent with it having the intention or ability to give effect to the terms of this agreement
• 13.1.3 the provider, or any of the providers employees or agents (in all cases whether or not acting with the providers knowledge):
  1. directly or indirectly offers, promises or gives any person working for or engaged by the local authority a financial or other advantage to:
     1. induce that person to perform improperly a relevant function or activity
     2. reward that person for improper performance of a relevant function or activity
  2. directly or indirectly requests, agrees to receive or accept any financial or other advantage as an inducement or a reward for improper performance of a relevant function or activity in connection with this agreement
  3. commits any offence:
     1. under Section 117(2) of the Local Government Act 1972
     2. under the Bribery Act 2010
     3. under legislation creating offences concerning fraudulent acts
     4. at common law concerning fraudulent acts relating to this agreement or any other contract with the local authority
     5. to defraud, attempt to defraud or conspire to defraud the local authority
• 13.1.4 the provider suspends, or threatens to suspend, payment of its debts or is unable to pay its debts as they fall due or admits inability to pay its debts or (being a company or limited liability partnership) is deemed unable to pay its debts within the meaning of section 123 of the Insolvency Act 1986 or (being an individual) is deemed either unable to pay its debts or as having no reasonable prospect of so doing, in either case, within the meaning of section 268 of the Insolvency Act 1986 or (being a partnership) has any partner to whom any of the foregoing apply
• 13.1.5 the provider commences negotiations with all or any class of its creditors with a view to rescheduling any of its debts, or makes a proposal for or enters into any compromise or arrangement with its creditors other than for the sole purpose of a scheme for a solvent amalgamation with one or more other companies or its solvent reconstruction
• 13.1.6 a petition is filed, a notice is given, a resolution is passed, or an order is made, for or in connection with the winding up of the provider (being a company) other than for the sole purpose of a scheme for a solvent amalgamation of the provider with one or more other companies or the solvent reconstruction of the provider
• 13.1.7 an application is made to court, or an order is made, for the appointment of an administrator or if a notice of intention to appoint an administrator is given or if an administrator is appointed over the provider (being a company)
• 13.1.8 a floating charge holder over the assets of the provider (being a company) has become entitled to appoint or has appointed an administrative receiver
• 13.1.9 a person becomes entitled to appoint a receiver over the assets of the provider or a receiver is appointed over the assets of the provider
• 13.1.10 the provider (being an individual) is the subject of a bankruptcy petition or order
• 13.1.11 a creditor or encumbrancer of the provider attaches or takes possession of, or a distress, execution, sequestration or other such process is levied or enforced on or sued against, the whole or any part of its assets and such attachment or process is not discharged within 14 working days
• 13.1.12 any event occurs, or proceeding is taken, with respect to the provider in any jurisdiction to which it is subject that has an effect equivalent or similar to any of the events mentioned in clauses 13.1.3 to clause 13.1.12 (inclusive)
• 13.1.13 the provider suspends or ceases, or threatens to suspend or cease, to carry on all or a substantial part of its business
• 13.1.14 the provider is a charity or organisation which is dissolved, wound up or is otherwise brought to an end
• 13.1.15 the provider does not actively promote fundamental British values or if they promote views or theories as fact which are contrary to established scientific or historical evidence and explanations
• 13.1.16 the provider is an early years' provider or childminder and is awarded by Ofsted a grade:
  1. lower than the grade required under clause 3.6.1(a), 3.6.2(a) or 3.7; as applicable or
  2. of 'inadequate';
• 13.1.17 the provider is an agency childminder and:
  1. the childminder agency is awarded by Ofsted a grade lower than the grade required under clause 3.6.1(b), 3.6.2(b) or 3.7 as applicable, or
  2. the childminder agency is awarded by Ofsted a grade of 'not effective'. or
  3. the childminder agency has notified the local authority that the services delivered by the provider are not, in their reasonable opinion, of satisfactory quality
• 13.1.18 the provider is in breach of any statutory requirement, including but not limited to any breach of the statutory guidance, the EYFS statutory framework or any other applicable law
• 13.1.19 the provider fails to make reasonable adjustments in line with the Equality Act 2020 to meet the needs of children with a disability
• 13.1.20 the provider makes any verbal or written statement (including use of social media) about the local authority or any of its employees or agents which in the local authority's sole opinion is offensive, insulting, discourteous or otherwise

13.2 For the purposes of clause 13.1.1 material breach means a breach (including an anticipatory breach) that is serious in the widest sense of having a serious effect on the benefit which the terminating party would otherwise derive from a substantial portion of this agreement over the term. In deciding whether any breach is material no regard shall be had to whether it occurs by some accident, mishap, mistake or misunderstanding.

14. Voluntary termination

14.1. Either party may terminate this agreement at any time by providing the other party with one month's prior written notice, whereby this agreement shall terminate upon the expiry of that notice with immediate effect.

15. Consequences of termination

15.1. No funding shall be paid to the provider following expiry or termination of this agreement.

15.2. In the event that this agreement is terminated in accordance with clause 13.1 the local authority shall be entitled to recover from the provider any losses it suffers as a result of the circumstances giving rise to the local authority's ability to terminate this agreement.

15.3. Subject to clause 15.1 in the event that this agreement is terminated in accordance with clause 14, each party shall bear its own costs and shall have no liability to the other party.

15.4. The provider shall immediately on termination or expiry (howsoever arising) of this agreement provide the local authority with all assistance (including without limitation the provision of data not constituting confidential information of the provider) reasonably required for the timely transfer of the services to the local authority or to another provider.

15.5. Within 10 working days of the termination or expiry (howsoever arising) of this agreement, the provider shall return to the local authority all software, manuals, information, data, drawings and other documents and materials provided to or prepared by the provider in pursuance to this agreement together with all confidential information and data received from the local authority, third party or other source in connection with this agreement, and any funding prepaid by the local authority in respect of services not provided by the provider by the date of expiry or termination of this agreement.

15.6. Termination or expiry of this agreement shall not affect any rights, remedies, obligations or liabilities of the parties that have accrued up to the date of termination or expiry, including the right to claim damages in respect of any breach of the agreement which existed at or before the date of termination or expiry.

16. Suspension of a provider from the directory of providers

16.1. This clause 16 shall operate without prejudice to any rights that have accrued under this agreement or any of the local authority's rights or remedies.

16.2. The local authority shall have the right to suspend the provider from the Directory of Providers by immediate written notice in accordance with clause 16.3 in the event that the provider ceases to be eligible, and/or

• 16.2.1 the provider ceases to be eligible, and/or
• 16.2.2 in the absolute discretion of the local authority the provider has breached the Directory Conditions, and/or
• 16.2.3 the provider fails to make payment of any monies due to the local authority under clause 4, and/or
• 16.2.4 the provider:
  1. is an early years' provider who has been suspended from the Ofsted Early Years Register, or
  2. is a childminder who has been suspended from the Ofsted Early Years Register, or
  3. is an agency childminder and the childminder agency has been suspended from the Ofsted Early Years Register

16.3. If the local authority suspends the provider from the Directory of Providers under this clause 16 it shall serve written notice ('suspension notice') on the provider setting out:

• 16.3.1 that the provider has been suspended from the Directory of Providers by the local authority
• 16.3.2 the reasons for suspension
• 16.3.3 where the breach is capable of rectification the timeframe for the breach to be rectified by the provider

16.4. Upon receipt of a suspension notice the provider shall immediately take all remedial action necessary to rectify (where rectifiable) the breach giving rise to the suspension notice.

16.5. Should the provider fail to rectify the breach within the timeframe determined by the local authority, the local authority reserves the right to remove the provider from the Directory of Providers and terminate this agreement upon giving 5 working days' notice to the provider.

16.6. Where the local authority provides notice to the provider under clause 16.3 a service suspension shall take effect from the date of the notice and shall continue in force until it is lifted in accordance with clause 17.4.1 or until the agreement is terminated in accordance with clause 16.5 or clause 17.5.1.

16.7. Where the provider has been suspended from the Directory of Providers the local authority reserves the right to reinstate the provider to the Directory of Providers if:

• 16.7.1 in the local authority's sole discretion the grounds for suspension no longer apply, or
• 16.7.2 the provider has in the absolute discretion of the local authority remedied the breach which gave rise to a suspension notice

16.8. In accordance with clause 4.3.7 the local authority may, at its absolute discretion, withhold, suspend, withdraw and/or require repayment of all or part of the funding relating to any period of service suspension.

17. Appeal against removal from directory

17.1. The provider may appeal the local authority's decision to remove the provider from the Directory of Providers under clause 16.5, by submitting an appeal ('the appeal') to the local authority in accordance with clause 17.2.

17.2. The appeal will only be valid if it is:

• 17.2.1 in writing detailing the grounds for appeal and enclosing all supporting evidence
• 17.2.2 submitted to the local authority and marked for the attention of the principal finance officer (early years)
• 17.2.3 received by the local authority within 10 working days of the date of the notice issued by the local authority under clause 16.5

17.3. Upon receipt of the appeal the local authority shall:

• 17.3.1 provide a written acknowledgement to the provider within 5 working days
• 17.3.2 review the appeal within 20 working days and
• 17.3.3 provide written notification of the outcome of the appeal to the provider within 30 working days

17.4. If the appeal is successful:

• 17.4.1 the local authority shall immediately reinstate the provider to the Directory of Providers
• 17.4.2 the service suspension shall be lifted with immediate effect

17.5. If the appeal is unsuccessful:

• 17.5.1 the local authority may remove the provider from the Directory of Providers
• 17.5.2 terminate this agreement on immediate written notice to the provider

17.6. If the provider is not satisfied with the outcome of the appeal, the provider shall be entitled to make a complaint in accordance with the local authority's complaints procedure.

17.7. For the avoidance of doubt, the providers right of appeal under this clause 17 shall only apply to the local authority's decision to remove the provider from the Directory of Providers and shall not apply to any decision of the local authority to suspend the provider from the Directory of Providers.

18. Complaints procedure

18.1 The local authority shall supply to the provider a poster which identifies to parents/carers that the services are funded by the local authority and the procedure for dealing with complaints. The provider must display the poster within the setting at all times.

18.2 The provider must ensure that:

• 18.2.1 it implements and maintains a complaints procedure (the 'complaints procedure') entitling a parent/carer to make a formal complaint about any aspect of the provision of the service.
• 18.2.2 the complaints procedure provides for the complaint to be properly investigated and for a written response to be received by the complainant within a timely manner
• 18.2.3 Parents/carers are informed of their right to make a complaint and are provided with a copy of the complaints procedure
• 18.2.4 Parents/carers are informed that they may also make a complaint directly to the local authority
• 18.2.5 A written record is maintained of all complaints and concerns, including any complaints resolved directly by the provider and that such records are made available to the local authority upon request
• 18.2.6 Any unresolved complaints, are notified to the local authority within 5 working days

18.3 The provider will co-operate with any investigation undertaken by the local authority in relation to any complaint made in relation to the services.

18.4 The provider's complaints procedure must be fully integrated with and compatible with the local authority's procedure for dealing with complaints which the local authority may at its absolute discretion amend from time to time.

18.5 The provider shall provide to the local authority upon request, details of any complaint which has been made about the service and the provider's response to the complaint in question.

18.6 The local authority may use any information, statistics or records, relating to complaints made to the local authority under the local authority's complaints procedure, to assess the performance of the provider and providers compliance with this agreement.

18.7 Should the local authority receive a complaint from a parent/carer about any aspect of the provision of the services, the parent/carer will first be advised to talk to the provider to see if the complaint can be resolved to the satisfaction of both the parent/carer and the provider.

18.8 If, the complaint is not resolved under clause 18.7, the local authority shall request that the parent/carer makes the complaint in writing to info.fis@derbyshire.gov.uk and the complaint shall be dealt with in accordance with the local authority's procedure for dealing with complaints.

19. Dispute resolution

19.1. Without prejudice to the appeals procedure set out in clause 17 in the event of any complaint or dispute arising between the parties to this agreement in relation to this agreement, the matter should first be referred for resolution to the local authority and the authorised representative of the provider or any other individual nominated by the parties from time to time.

19.2. Should the complaint or dispute remain unresolved within 14 days of the matter first being referred to the local authority and the authorised representative of the provider or other nominated individual, as the case may be, either party may refer the matter to the assistant director of schools and learning of the local authority and the authorised representative of the provider with an instruction to attempt to resolve the dispute by agreement within 28 days, or such other period as may be mutually agreed by the local authority and the provider.

19.3. In the absence of agreement under clause 19.2, the parties may seek to resolve the matter through mediation under the CEDR Model Mediation Procedure (or such other appropriate dispute resolution model as is agreed by both parties). Unless otherwise agreed, the parties shall bear the costs and expenses of the mediation equally.

19.4. Neither party may initiate any legal action until this process has been completed unless such party has reasonable cause to do so to avoid damage to its business or to protect any right of action it may have.

20. Force majeure

20.1. If any force-majeure event occurs in relation to either party which affects or may affect the performance of any of its obligations under this agreement, it shall forthwith notify the other party as to the nature and extent of the circumstances in question.

20.2. Neither party shall be deemed to be in breach of this agreement or shall otherwise be liable to the other by reason of any delay in the performance or non-performance of any of its obligation under this agreement, to the extent that the delay or non-performance, is due to any force majeure event of which it has notified the other party, and the time for performance of that obligation shall be extended accordingly.

20.3. If the performance by either party of any of its obligations under this agreement is prevented or delayed by a force majeure event for a continuous period in excess of 7 days, the parties shall enter into discussions with a view to agreeing upon such alternative arrangements as may be fair and reasonable.

20.4. If either party is prevented from performance of its obligations for a continuous period in excess of 14 days, the other party may give written notice on the party so prevented to immediately terminate this agreement.

21. Notices

21.1. All notices and other communications required to be given under this agreement shall be in writing and shall be deemed to have been duly given if delivered by hand (or by courier) or sent by prepaid first-class post to the address of the other party set out in this agreement or such other address as may have been otherwise notified in writing.

21.2. If delivered by hand (or by courier), all such communications shall be deemed to have been given when received (except that if received on a non-working day or after 5pm on any working day they shall be deemed received on the next working day) and, if mailed, all such communications shall be deemed to have been given and received on the second working day following such mailing.

22. Meetings

22.1. The provider shall attend review meetings either face to face, via Microsoft Teams or by telephone conference, at such frequency as may be required by the local authority where the parties shall discuss the provision of the service, the operation of this agreement, and in particular, the ongoing relationship between the parties.

23. Assignment and sub-contracting

23.1. The provider shall not assign, novate, sub-contract or otherwise transfer any of its rights or obligations under this agreement without the prior written consent of the local authority. In any event, the provider will remain liable for all the acts and defaults of its sub-contractor or any transferee as if the provider had itself carried out such acts and defaults.

24. Statutory requirements

24.1. The provider shall comply with all statutes, laws, orders, regulations and by-laws having the force of law and being applicable to the performance of this agreement and the provider shall be responsible for obtaining all licences, consents or permits required for the performance of this agreement.

24.2. Without prejudice to clause 24.1 the provider shall at all times comply with and meet all the requirements of the Equality Act 2010, the National Minimum Wage Regulations and the National Minimum Wage (Amendment) Regulations.

24.3. The provider shall indemnify and hold harmless the local authority from and against all losses as a result of the provider's non-compliance with its obligations set out in this clause 24.

25. Bribery and corruption

25.1. The provider represents and warrants that neither it, nor to the best of its knowledge any provider personnel, have at any time prior to the commencement date:

• 25.1.1. committed a prohibited act or been formally notified that it is subject to an investigation or prosecution which relates to an alleged prohibited act, or
• 25.1.2. been listed by any government department or agency as being debarred, suspended, proposed for suspension or debarment, or otherwise ineligible for participation in government procurement programmes or contracts on the grounds of a prohibited act

25.2. The provider shall not during the term of this agreement:

• 25.2.1. commit a prohibited act
• 25.2.2. do or suffer anything to be done which would cause the local authority or any of the local authority's employees, consultants, contractors or agents to contravene any of the relevant requirements or otherwise incur any liability in relation to the relevant requirements

25.3. The provider shall during the term of this agreement:

• 25.3.1. establish, maintain and enforce policies and procedures which are adequate to ensure compliance with the relevant requirements and prevent the occurrence of a prohibited act
• 25.3.2. keep appropriate records of its compliance with its obligations under clause 25.3.1 and make such records available to the local authority on request

25.4. The provider shall immediately notify the local authority in writing if it becomes aware of any breach of clause 25.1 and/or 25.2, or has reason to believe that it has or any of the provider personnel have:

• 25.4.1. been subject to an investigation or prosecution which relates to an alleged prohibited act
• 25.4.2. been listed by any government department or agency as being debarred, suspended, proposed for suspension or debarment, or otherwise ineligible for participation in government procurement programmes or contracts on the grounds of a Prohibited Act
• 25.4.3. received a request or demand for any undue financial or other advantage of any kind in connection with the performance of this agreement or otherwise suspects that any person or party directly or indirectly connected with this agreement has committed or attempted to commit a prohibited act.

25.5. If the provider makes a notification to the local authority pursuant to clause 25.4 the provider shall respond promptly to the local authority's enquiries, co-operate with any investigation, and allow the local authority to audit any books, records and/or any other relevant documentation in accordance with clause 26 (audit).

25.6. If the provider is in default under clauses 25.3.1 and/or 25.2, the local authority may by notice:

• 25.6.1 require the provider to remove from performance of this agreement any provider personnel whose acts or omissions have caused the default
• 25.6.2 immediately terminate this agreement

25.7. Any notice served by the local authority under clause 25.6 shall specify the nature of the prohibited act, the identity of the party who the local authority believes has committed the prohibited act and the action that the local authority has elected to take (including, where relevant, the date on which this agreement shall terminate).

26. Audit

26.1. The local authority shall be entitled to carry out audits to determine whether the provider is adhering to the terms and conditions laid out under this agreement. For this purpose, the provider grants to the local authority, its statutory auditors or any authorised agents of the local authority, a right of reasonable access to any premises of the provider which are used in connection with the performance of the provider's responsibilities and obligations under this agreement. Such access shall include a right to access to all computer systems, personnel and financial records, minute books and any other relevant evidence (including obtaining relevant copies).

26.2. The provider shall afford the local authority, its auditors or agents all co-operation and assistance reasonably required for the purposes of carrying out an audit of the provider's compliance with this agreement.

27. Right of set-off

27.1. The local authority may retain or set off any amount owed to it by the provider against any amount due to the provider under this agreement or under any other agreement between the provider and the local authority.

28. Equality Act

28.1. The provider shall observe and comply with the local authority's policies on equalities and human rights as amended from time to time.

29. Third party rights

29.1. The parties confirm their intent not to confer any rights on any third parties by virtue of this agreement and accordingly the Contract (Rights of Third Parties) Act 1999 shall not apply to this agreement.

30. Waiver

30.1. No failure or delay by a party to exercise any right or remedy provided under this agreement or by law shall constitute a waiver of that or any other right or remedy, nor shall it preclude or restrict the further exercise of that or any other right or remedy. No single or partial exercise of such right or remedy shall preclude or restrict the further exercise of that or any other right or remedy.

31. Remedies

31.1. Except as expressly provided in this agreement, the rights and remedies provided under this agreement are in addition to, and not exclusive of, any rights or remedies provided by law.

32. Variation

32.1. Subject to clause 32.2 no variation of this agreement shall be effective unless it is in writing and signed by the parties (or their authorised representatives).

32.2. The local authority reserves the right to unilaterally vary this agreement from time to time by notice in writing to the provider to comply with any changes in the law and/or the statutory guidance.

33. Entire agreement

33.1. This agreement and any documents referred to in it, including but not limited to the service specification to this agreement, the statutory guidance and the EYFS statutory framework constitute the whole agreement between the parties and supersedes, cancels and nullifies any previous arrangement, understanding or agreement between the parties relating to the subject matter of this agreement notwithstanding the terms of any previous agreement or arrangement expressed to survive termination.

33.2. Each party acknowledges that, in entering into this agreement and the documents referred to in it, it does not rely on any statement, representation, assurance or warranty ('representation') of any person (whether a party to this agreement or not) other than as expressly set out in this agreement or those documents.

33.3. Each party agrees that the only rights and remedies available to it arising out of or in connection with a representation shall be for breach of contract as expressly provided in this agreement.

34. Severance

34.1. If any court or competent authority finds that any provision of this agreement (or part of any provision) is invalid, illegal or unenforceable, that provision or part-provision shall, to the extent required, be deemed to be deleted, and the validity and enforceability of the other provisions of this agreement shall not be affected.

34.2. If any invalid, unenforceable or illegal provision of this agreement would be valid, enforceable and legal if some part of it were deleted, the parties shall negotiate in good faith to amend such provision such that, as amended, it is legal, valid and enforceable, and, to the greatest extent possible, achieves the parties' original commercial intention.

35. Counterparts

35.1. This agreement may be executed in any number of counterparts, each of which when executed and delivered shall constitute an original of this agreement, but all the counterparts shall together constitute the same agreement.

36. Governing law and jurisdiction

36.1. This agreement and any dispute or claim arising out of or in connection with it or its subject matter or formation (including non-contractual disputes or claims) shall be governed by and construed in accordance with the law of England and Wales.