Twenty-eight female guards were unfairly dismissed by a security company because the client‚ Metrora.
The Mpumalanga department of education is considering whether to fire the Hoërskool Ermelo principal by the end of this month or after three months.
The department said it had proof "beyond reasonable doubt" that Jacobus Kruger was being insubordinate when he opposed a directive instructing him to admit black English-speaking pupils.
Department spokesman Hlahla Ngwenya disclosed that the department had intended to fire Kruger last week but that his lawyer, Piet Delport, proposed that his client be given three months notice after which he would take early retirement.
"We are still considering the proposal and will respond to them later," said Ngwenya. "We reserve the right to accept or dismiss the proposal."
Kruger was suspended on January 17 for alleged misconduct.
This was after 95 English- speaking pupils were left stranded in the school hall without tuition for two weeks when the school reopened this year.
Kruger was suspended on full pay and forbidden from entering the school premises without the authorisation of regional director Nokuthula Mthethwa.
In its defence, the school governing body (SGB) claimed there was no room for the pupils since all the classrooms were occupied.
The SGB also accused the department of failing to provide the school with handbooks or teachers for the English-speaking pupils.
Kruger remains suspended on full pay and may not enter the school premises without the permission of the regional director.
Frank Hlatshwayo, the circuit manager for the department of education in Ermelo, has been appointed to replace Kruger "until further notice".