Legal Considerations
The first step to determine if contracting is the right solution for your district is to verify multiple legal aspects of educational contracting:
Is It Legal?
The majority of states have laws that either:
- Allow contracting of educational employees, such as substitutes as part of state code
- Restrict forms of contracting that affect certain classes, or actions of a contracted employee
- Legally disallow contracting of educational employees by a third party contractor
State Educational Restrictions
States that allow contracting have established written guidelines that control multiple aspects of a contracted employee:
- Certification and/or educational credential requirements for each class of contracted employee
- Permits for non-certified substitutes
- Pay Rates for long term placements
- The effect of State Educational Pension funding as it applies to a contracted employee
PESG will work with your district to adopt and follow not only the state’s restrictions, but also additional requirements that your district may ask of contracted employees.
Arm's Length Relationship
Typically testing to assure a legal “Arm’s Length Relationship” with contracted employees is defined at the Federal level.
Some states may require additional steps that either further separate or comingle the employment relationship with a contracted educational employee. Some of these areas would include:
- Fingerprinting & Educational Document hosting at the district level
- Required training for contracted employees specific to the district and the assigned position(s)
- Who is reporting payroll & how is it calculated
- Management of contracted employees onsite at the district level
PESG has worked hard to build a process and service solution that surpasses contracting challenges
Employment Laws
Most states have similar additional requirements for educational employees as part of the employment process.
These requirements typically also apply to a contracted employee placed in a school environment. The following examples are typically shared between states as it pertains to an educational employee.
- Criminal History Background Checks & Fingerprinting
- Prior employer unprofessional conduct checks
- Federal I-9 employment requirements
- Safety training requirements as part of the educational community, such as:
- Blood borne Pathogens
- Food Allergies
- FERPA Disclosure Laws
- Sexual Harassment
- Hazardous Materials Handling
- Federal & State Educational Laws and Punishment Guidelines
- “Reasonable Assurance Language” that protects districts and third party contractors against unemployment certain unemployment claims during seasonal periods.
General Educational Business Laws
Each state has varying requirements as it pertains to the contractual relationship with a third party contractor:
- Does this service need to be set up through an “RFP” or bid process?
- What portions of the contracting documentation are subject to FOIA disclosure laws?
- What are the domicile requirements of a third party educational contractor?
- Does this service conflict with the current negotiated teacher contract?
PESG has helped to define the bidding process with multiple RFP templates and the protection of sensitive documents and document controls.
Together, PESG can mutually investigate these legal questions with your district to determine if contracting with PESG is the right direction for the district, the educational program, the students, and the community. Further, PESG may partner with your state’s foremost educational legal firm to answer these questions and pave the way for a proper and comprehensive contracting solution.

