We were fortunate to have Tom Copeland present a webinar about, How to Effectively Use Contracts and Policies on April 6, 2016. Many of the participants had questions that we were unable to ask Tom. He was kind enough to answer them and they are posted below. Here is a link to the recording: Coming to Terms: How to Effectively Use Contracts and Policies.
Q.1. Can I charge more for a child with special needs, considering that I charge more for infants?
A.1. No. The ADA prohibits discrimination against children or parents with disabilities. This means you cannot charge more to a special needs child. You can charge more for infants because infants are not in a legally protected class of people. In other words, you cannot discriminate against people because of their race, sex, age, religion, ethnic background, national origin or disability. Some states and local governments also prohibit discrimination based on sexual orientation, marital status and other categories. Age discrimination applies to persons aged 40 and older.
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Q.2. If I don’t feel I can provide appropriate care for a child with special needs can I legally terminate the child?
A.2. Not if it is based only on your feelings. This doesn’t mean you have to care for every child who has a disability. The ADA law says you must do what is “reasonable” to provide accommodations to children with disabilities. If the only way you can provide care would create an “undue burden” then you don’t have to provide care. Undue burden means a “significant difficulty or expense.” But, it’s not enough to terminate care based solely on your feelings.
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Q.3. If I feel a child will not fit into my program because of a special need, how do I get around that?
A.3. You must find out how you can provide appropriate care for the child. For example, if the child is in a wheelchair and it would cost you $200 to install a temporary ramp to get into your home, you would have to do it because that is not a significant expense. Spending $5,000 would likely be a significant expense and you can refuse the child. The vast majority of providers (homes and centers) care for children with disabilities without incident.
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Q.4. If I feel that I’m not qualified to care for a child with a disability, may I just say no? I’m concerned about the safety of the child when a child might throw chairs, hurt me or other children, or flee my program.
A.4. You are right that your first responsibility is keeping all the children safe in your program. If a child with a disability is creating a safety issue, you must act. You can tell the parent the child cannot come back until you have figured out a way to provide safe, appropriate care for the child. But, then you must explore what can be done so you can provider care for this child and all the other children. Maybe it means taking some training to know how to better handle this child. If training would solve the problem, you’d have to take the training.
Let’s say the only way to keep everyone safe is to have another adult with the child at all times. If so, you would be required to find out if any volunteers can come in to help. If there are no volunteers then you need to find out what it would cost to hire someone for enough hours a week so everyone would be safe. If hiring someone would create a “significant” expense, then you can tell the parent you cannot afford to do this. You cannot ask the parent to pay for this additional adult. If the parent volunteers to pay, you must provide the care.
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Q.5. “Your child is causing injuries to other children and is not adjusting to the social environment of my program.” Is this grounds for dismissal?
A.5. Not until you have done the research to find out what would need to happen to provide appropriate care. In other words, you can’t just say no to a child with disabilities without first having found out what the solution would be so that you could provide care. If the only solution to providing care would create an “undue burden” then you don’t have to provide the care.
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Subsidy Program
Q.6. May I charge different rates to different parents when some parents are on the subsidy program?
A.6. Maybe. Let’s say your private pay fee is $180 a week. Let’s say your state subsidy program will pay you $150 a week for a subsidized parent. Most states will allow you to charge the parent the $30 a week difference. A few states prohibit this. You need to find out what your state law says.
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Q.7. Can I charge advance payments for parents on the subsidy program?
A.7. It depends on your state rules.
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Q.8. What deposit or advance payment policies would you suggest for subsidy families?
A.8. If your state allows it, I would recommend having subsidy families pay at least one week of copay in advance and two weeks of copay for the last two weeks of care. This may be difficult, if not impossible, for many subsidy families.
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Contract Termination Issues
Q.9. What, if anything, should you put in writing when you are going to terminate a child from your program?
A.9. Keep it short. I would not explain why you are terminating a child in a written statement to parents. Parents will not agree with you and may feel insulted. Instead, write: “The last day of care for your child will be _________ (date). Payment will be due under the terms of our contract through this date.”
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Q.10. If a parent leaves my program because she is mad that another child scratched her child, can I sue them for the monies due?
A.10. Yes. You can always sue. Will you win in court? Maybe. If the child is seriously injured, the parent may be able to convince the judge that you were at fault and you may lose. You would argue that the parent still owes you for the care you provided.
If a parent leaves under these circumstances, contact your child care licensor. You may be required to report such an injury. But, you also want to tell your licensor that the parent has left owing you money. This will help you if the parent later makes a complaint unrelated to this incident. It’s always best to keep your licensor informed of conflicts with parents so they hear about them from you first.
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Q.11. Do you need a written termination notice?
A.11. It’s not a requirement. I think it’s a good idea so there is no misunderstanding. Your termination notice be short.
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Q.12. I am concerned that if I terminate a parent because they are a pain in the neck, they will complain to licensing and make something up. Then I can get into trouble with licensing. Any advice? What if they make up a lie about why they were terminated?
A.12. This can and does happen. Here’s how to protect yourself. Keep your own records of any conflicts with parents. Keep your licensor informed of these conflicts. You are not asking your licensor to solve the problem for you. You want to go on notice that this parent is disruptive or threatening or whatever else. If your licensor gives advice, make a note of it. Contact your licensor immediately after terminating the parent and bring her up to date. Doing this will make it less likely the licensor will believe the parent who calls later to make an unfounded complaint against you. This is a situation where child caregivers are vulnerable. Licensors must investigate any serious complaint. But, if the licensor knows the history with the parent you are in a much better position.
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Q.13. Should I bring up past documented issues with parents during the termination process?
A.13. Maybe. Ideally, there was a process leading up to the termination of a parent. You should be discussing the issues as they came up and tell the parent, “If we can’t resolve this problem it will lead to your termination.” I also think it’s a good idea to give parents a final chance: “If this happens again, I will have to terminate our contract.” In other words, you should be communicating all along that the consequence of a parent not following your rule is termination. You don’t want the termination to be a surprise. When you have been communicating all along, then I don’t think it is wise to say anything more when you do terminate. This is because it will only bring up bad feelings and the parent may want to argue with you. Sometimes it may not be possible to terminate after a process of trying to resolve a problem. For example, the parent threatens you or your staff with violence. In this case immediate termination is warranted.
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Q.14. When parents leave and you ask them to fill out a withdrawal form, should you ask them why they are leaving?
A.14. I think this is a good idea. You want to know as much as possible about parent preferences and factors that cause them to choose one child care program over another. Some reasons you can’t do anything about (“We’re moving.”), while other reasons may cause you to make some changes (“We need a program with more learning activities.”).
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Contract Payment Issues
Q.15. Is it illegal to tell a parent they can’t bring a child back to your program until they are paid in full?
A.15. No, it’s not illegal. By not paying you on time, the parent has violated your contract. I would strongly recommend that you put the following term in your contract: “Provider may terminate at will.” But, even if your contract requires you to give parents a two-week notice, you can still refuse care if the parent has not paid in full.
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Q.16. I want to give parents a written reminder that they need to pay on time. Do you have a sample statement I can give them?
A.16. “According to our contract, payment is due on Friday for the following week of care. There is a late payment fee of $_____ if you do not meet this deadline. If you have a problem meeting this deadline, please discuss this with me.”
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Q.17. Can you charge parents more if they pay by credit card?
A.17. It depends on your state. In some states you can, but must post a sign notifying parents. In some states you are limited to how much extra you may charge. Some providers charge parents the fee charged by the credit card company. Some providers don’t.
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Q.18. If I have different rates for different parents, based on different things, do I need to put in writing these individualized policies?
A.18. It’s not a requirement that you do so. You should assume, however, that all parents will find out what other parents are being charged. If you don’t have your rates in writing you may create more confusion than necessary. I would put your individual rates in writing for each parent so you can enforce your contract. I would not put in writing the reason for the rate (family income, spouse in hospital, newly enrolled family, or other special circumstances).
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Q.19. What is the best way to recover payments that are due when a child leaves? Letters to parents usually haven’t worked. Should we go to small claims court?
A.19. If a “demand letter” to the parent doesn’t work, then, yes, take them to small claims court! Too many child care programs allow parents to leave their program owing money and do nothing about it. Your demand letter should be short: “According to our contract you owe $_____. If you do not pay or make arrangements to pay by _________ (date of deadline) we will have no alternative but to take you to court where we will sue you for $______, plus court costs.” The only way to avoid this situation entirely is to require private pay parents to pay you at least a week in advance and to pay for their last two weeks in advance. If a parent can’t afford this, you can require them to pay you a little extra each week until you have this money in hand.
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Q.20. How expensive it is for a provider to take a parent to court to collect unpaid fees?
A.20. It depends on your local small claims court. Usually, it would be less than $50, but it can vary. Add this fee onto the amount for which you are suing the parent.
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Q.21. I had a parent get mad at me for charging them a late fee, because they say when they pick up early they should be credited with the minutes when they are late.
A.21. Although this may sound logical to the parent, you answer should be, “That’s not how my rules work. You owe me a late fee, regardless of how often you pick up early. That’s my rule.” Sometimes child caregivers feel the need to justify or explain their rules in detail, hoping that the parent will come to agree with them. No. You can give a brief explanation of your rules, but in the end, they are your rules and parents must follow them.
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Q.22. Is it legal to charge some parents and allow some others to receive free care based on their ability to pay?
A.22. Yes, in general. If you are caring for subsidized families, you must follow their rules. However, with private pay parents you can set up your own sliding fee or discount program and charge more to parents who make more and less (or nothing!) to parents who make less. Let’s say you decide to provide free care for six months to a family that is suffering a major financial setback. If another family comes to you and says they also are suffering financially and want free care, are you required to give this family free care? No. You can always limit your discount/free care policy to one family and you can change your policy at any time.
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Q.23. Are you supposed to charge payments when the provider is going on vacations?
A.23. Nope. You can do whatever you want. Some providers/programs charge when they close for vacations, some don’t. What if a parent objects to paying for your vacation because they must pay twice that week when they pay another caregiver? You can offer the parent the option of paying a little extra the rest of the year to cover the vacation pay and then not charge them for your vacation. Parents get paid vacations. Child care providers should receive no less.
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Q.24. Is there a set amount that can be charged for returned checks? Can a provider charge more than the bank charges for returned checks?
A.24. Yes, you can charge parents who bounce a check more than the bank charges you. There may be a limit on how much you can charge. Check with your state consumer protection agency. If you are going to charge a fee (which I recommend) you should put a notice of this in your contract.
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Q.25. If I am going on vacation and parents want to stop service and does not want to pay my vacation fee, what should be in the contract so I cannot lose my money?
A.25. You can raise your rates enough to cover payment for your vacation, so the parent won’t be paying you during your vacation. You can put in your contract that payment for the vacation is due whether or not the parent is in care at the time of the vacation, but that will be difficult to enforce. You can require parents to give you a longer notice when they are leaving (one month) so they are less likely to leave immediately before your vacation.
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General Contract Issues
Q.26. I want to make a change on my contract. Is there a difference between having the parents sign on the last page or put their initial on the bottom of each page?
A.26. There are several ways to make a change in your contract. You can write out a new contract and have parents sign the last page. You can scratch out a change on one page and you and the parents put their initial next to the change. Or, you can write out a new paragraph, you and the parent sign the change and attach the paragraph to your contract.
There is no legal difference with any of these methods. The primary purpose of a contract is to facilitate communication between you and the parents. Some providers have parents initial each page of their contract and policies. Some providers require only a signature at the end of the contract. The purpose of having parents initial each page is to stress the importance of each rule. There is no right or wrong answer.
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Q.27. How much notice do I need to give when changing my policy? Do parents need to sign my new policy?
A.27. There is no rule that says you have to give parents any notice of changes to your policies. It’s reasonable to give parents some notice of any changes, but you can make changes immediately if necessary. There is no requirement that parents sign your new policy. However, many providers do have parents sign their policies so parents will take them more seriously.
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Q.28. Does there need to be a witness when the parent and child care program sign a contract?
A.28. Probably not. Some government contracts may require this, so check this out. Otherwise, there is no legal requirement to have a witness to the signing of your contract. You can have one if you want.
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Q.29. Are policies different than procedures and should they be given to all parents?
A.29. Policies and procedures are the same thing. You should give copies of your policies/procedures/handbook to all parents.
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Q.30. Is it a good idea to have an attorney review my contract?
A.30. If you can afford to hire an attorney or can find one to do it for free, then do so. The vast majority of child care programs do not use attorneys to review their contract.
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Q.31. Can we put whatever we want in our policies? Some states and QRIS systems require us to include special terms in our policies.
A.31. It’s true that some child care licensing rules or QRIS systems do require that you include certain terms in your policies. Be sure to follow these rules. Other than that, you can put whatever you want in your policies. Your only restriction is that you cannot discriminate based on race, sex, religion, age, national origin, disability or ethnic background.
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Q.32. Should we review our contract with parents every six months, three months, one year to allow for changes?
A.32. A regular review of your contract is a good idea. At least once a year. You are always free to make changes at any time.
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Q.33. How should I deal with suddenly enforcing my rules if I haven’t been doing it for a long time?
A.33. Simply announce what you are going to do. You can say to parents, “I know I haven’t been enforcing all of my rules consistently up until now. But, starting this month I will begin enforcing all of my rules, particularly __________________________. If you have any questions about this, let me know.”
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Q.34. There is an ethical issue in treating different families differently. How do you establish trust if treating each family differently or setting precedent with one family and then not the next?
A.34. Yes, you are right, there are ethical issues involved. You should be guided in your decisions by several factors. First, you must obey the law: child abuse laws, anti-discrimination laws, ADA, IRS payroll tax laws, etc. Second, you need to comply with your state child care licensing laws, Food Program regulations, subsidy rules, Head Start rules and other government regulations. Third, you should set your own high ethical standards, such as the NAEYC Code of Ethics, Accreditation and QRIS standards. Therefore, when you adopt different rules for different families they should be consistent with all of these factors. You should also be able to communicate with families that are following these standards because you believe them to be in the best interests of the children and their parents. When parents see that you are always acting in the best interests of families they should be better able to understand your actions. You are not perfect, so do your best.
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Q.35. Can refusing to accept children who have not been immunized but have health or religious exemptions be viewed as discrimination?
A.35. This is a complicated issue. Your state likely requires immunization of children. All states allow exceptions for medical reasons. Most states allow religious exceptions. Some states allow philosophical exceptions. Such exceptions can put children at risk and some states are rethinking their laws. Check with your state human rights office about when you can refuse a child who is not immunized.
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Q.36. I’ve been in the public sector too long. Tom’s is rather a heartless approach to the care and education of children. He absolutely has no consideration for the continuity of care for his customers (the children).
A.36. Heartless? I don’t think so. Child caregivers are not required to meet every need of the child or parent to the detriment of their program or their own lives. Caregivers are not required to say yes to every parent request and put up with parent violations of their contract so that the child will stay enrolled with their program. Of course, caregivers want to maintain continuity of care for all children. But, that is not the only value at issue. If it was the only value then parents would not be required to pay anything for child care and would not be required to follow any of the rules of a child care program. In my experience, child caregivers consistently bend over backwards to try to provide the best possible care for children, even when parents break their rules. My message in the webinar is that caregivers should establish their own rules and consistently enforce them. There is no shame in this. Parents are responsible for their own behavior and how this will impact their children. Caregivers can’t replace the role of the parents.
