How Two Hands Preschool pays staff 30% above industry average

Director Joanna Shall explains her London nursery’s strategy for offering 1 in 5 places completely free
A photo of preschool director Joanna Shall with an illustration of three Early Years educators wearing capes.
December 13, 2022
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Hammersmith, London

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1 in 5 places for free

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With Famly since

January 2023

Originally a teacher and an assistant head at a secondary school, Joanna Shall’s transition to the Early Years was partly thanks to her own children. As she read more and more about the importance of the first five years of a child’s life, her passion for education shifted from school to preschool.

“One book about parenting became 25 books about the Early Years,” says Joanna, “It wasn’t just a parental interest, but a career shift interest.”

But it didn’t stay just an interest for long.

During her daughter’s time at nursery, Joanna started building a mental list of things about the Early Years that didn’t sit right. 

“We’re very fortunate that we could afford a lovely nursery near our house,” says Joanna, “But I was dismayed that already at 2, my daughter was in a social bubble. It felt wrong that her first experience of the world outside home was a very narrow group of people, who could also afford that nursery.”

Not only that, Joanna realised that there was an apparent lack of understanding and respect for what Early Years educators do (coupled with low pay).

“As a secondary school teacher before having children, I can hold my hands up and say I didn’t know what people in the Early Years really did,” she explains, “and the more I read, the more I began to understand how complex and highly skilled an Early Years Teacher’s role is”.

And she wanted to do something about it.

So Joanna is creating a setting where 1 in 5 places are free for disadvantaged children, and staff are paid above the industry average and in line with their qualifications, so children of different backgrounds can experience high-quality Early Years provision together. She’s named it Two Hands Preschool.

But how will Two Hands Preschool help? And how will it work?

I met with Joanna to find out.

An rendering of what the garden of Two Hands Preschool will look like. There is a wooden sand pit, an area shaded by a striped canopy, a natural wooden climbing frame, and a water play area, made from wood.

The big ideas

  • Aside from offering 1 in 5 places fully free, staff at Two Hands Preschool are also paid between 15% and 30% higher than industry average, depending on the role.
  • Two Hands is doing this by reinvesting profits from the purpose-built preschool back into salary for staff and bursary places for children.
  • The Two Hands Team will also get paid time, within their scheduled hours, to step away from the children, reflect on what they’re doing, and engage with research.

Tackling inequality

At Two Hands, 80% of places are paid for at full price, like any other setting. But that leaves 20% of the places at Two Hands offered at a 100% discount. These bursary places are available, according to need and availability, for:

  • Looked after children.
  • Children eligible for Early Years Pupil Premium

“We want to focus on children and families who would most benefit from high-quality Early Years education, that provides the full-time care that working parents need. We know there are excellent local authority nursery schools in our area, but unfortunately, they are only funded to provide part-time hours for these families,” says Joanna.

Every time Two Hands Preschool fills four paid full-time places, the fifth is free. This will allow families who otherwise couldn't afford to attend a bespoke, full-time setting like Two Hands, the opportunity to do so.

And of course, the benefit extends to all the children attending, by allowing for a more diverse cohort.

“I know we have a lot of work to do to ensure that our inclusion and diversity approach makes everyone welcome and we are committed to undertaking this work as a staff body. Our headteacher is particularly passionate about this.” says Joanna.

“The fees are high because we pay staff really good wages. The cost of good quality graduates is high and the government funding is not sufficient to cover that.”

Joanna Shall, Director, Two Hands Preschool

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A rendering of how the interior of Two Hands Preschool will look. There is a colourful wall with spaces to sit and climb into, with wooden chairs and a table in the foreground.

Doing the maths

If you have really high-quality early years education and care, the better the outcomes for children, especially disadvantaged children. But how do you deliver this to everyone when high-quality early years education and care comes with a high price tag?

Joanna sought the help of her husband, who is an accountant and business advisor, to create a business model for a high-quality setting, accessible to a broader range of families.

However, it’s not that better-off parents are subsidising the education and care of other children - the fees for Two Hands are similar to other settings in the same area, of a similar type.

“They’re paying the market rate for the level of Early Years education and care that they’re getting in inner London,” says Joanna, “What is subsidising the free places is genuinely a reduction in profit.”

As Joanna puts it, purpose and profit can go hand in hand. 

“We know that there is a trend for investment in social enterprises such as B-corporations. Business owners are looking for more than just financial returns.There is room in the Early Years system, at the high end, to do this,” she explains.

However, Joanna is realistic about how replicable her business model is.

“We’re not fixing everything for everybody,” says Joanna, “There are a lot of families in between those who can afford Two Hands and those who are eligible for a bursary place. There is still a need for good, affordable, Early Years education. It couldn't be replicated everywhere as we wouldn't have the profit margin to offer the free places. But what we are doing is creating a setting that has a level of inclusion that other settings at this end don’t have.”

The Two Hands Foundation

Joanna is also creating The Two Hands Foundation, enabling donations from local businesses and corporations to sponsor a free place at the setting. Two Hands will match pound for pound whatever the donation is, says Joanna.

“We could have waited and offered the bursary places only after I’d paid off all the debts [accrued from opening a new setting] and not had the foundation,” says Joanna, “But I believe that if it’s a core value of your business, it should be a core value from day one.”

The other benefit of a foundation is that Joanna has a board of trustees that quality assures the bursary admissions procedure and ensures that Two Hands is having the impact that they set out to have.

“The Two Hands Foundation is there to hold us up to scrutiny,” explains Joanna, “On the board of trustees, we have an experienced CEO, a former senior leader from state education, an Early Years advisor and a parent with legal and tax expertise - a whole host of professionals.”    

So why aren’t more settings offering something like this?

Well, as Joanna explains, it’s not as straightforward as it seems. For example, Joanna doesn’t have an external investor, as many settings or groups do, that she has to justify cutting into profits to. 

And, with some help from her family, she’s the whole Head Office.

“I’m the bursar, the receptionist, the HR manager and the marketing team,” says Joanna, “The Headteacher’s full focus will be on the staff, children and their families. There’s not a lot of waste in the business model.”

A rendering of how Two Hands Preschool will look. There are wooden chairs and tables in the foreground and circular, yellow lighting on the ceiling. One wall is floor-to-ceiling windows and the other has colourful cubbies and places to sit.

What about the teachers?

Two Hands Preschool’s mission doesn’t stop at the children. “We want to put the love back in the job for those [educators] we might otherwise lose,” she says.

The traditionally long working hours, paperwork, and low wages mean that the sector isn't attracting (and keeping) the skilled educators it needs to survive.

But luckily for their teachers, Two Hands Preschool isn’t paying minimum wage, and wages will grow as the setting’s capacity does. Once they reach 60% capacity (including bursary places), all the staff get a 5% salary increase, and then, once 75% capacity is reached, all staff will receive an additional 10% raise.

And time matters too. One of Joanna’s first observations about Early Years was how much the educators were expected to do in the time they had.

“Where is the time in someone’s daily schedule to stop what they’re doing with the children in front of them and engage with the research?” asks Joanna, “As a primary or secondary school teacher, you have PPA time for planning, preparation, and assessment and even that wasn’t enough.”

So the Two Hands Team will get that too. Paid time, within their scheduled hours, to step away from the children, reflect on what they’re doing, and engage with research. The team will be actively discouraged from making their job at Two Hands their whole life.

“It’s not a good thing for [educators] to give the setting their all. It’s a 40-hour job,” says Joanna, “Please make it a 40-hour job for you. If you try to give 60 hours a week you’ll either burn out or become resentful.”

And so far, this approach is working. The appointed Headteacher is an highly experienced, nursery manager from an award-winning nursery in a school setting and the preschool is fully staffed for their opening in January.

So what’s next?

Providing all goes to plan, Two Hands will open at the start of 2023.

“We want to be a part of the local community,” explains Joanna, “I live in the area and my son is the first child starting in January. We want to have a positive impact beyond the 30 or 40 children who will attend the setting.”

Joanna would love for Two Hands to become a community hub, regardless of whether families attend the setting or not. The preschool is already sharing articles through Two Hands’ website, and in the next few weeks, the setting is hosting a Christmas party for local families.

“If, in five years' time, this has been a success and we can open a second setting, I think we will be able to go straight to giving places for free without the support of Two Hands Foundation.” says Joanna.

Watch this space!

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