School grades are indicated in a variety of ways. Sometimes they are "numeric grades" on a scale of 0 to 100, or 1 to 5. Sometimes they are "letter grades;" in the U.S., commonly A, B, C, D, F, with or without intermediate grades indicated by + or - signs.
Sometimes they are just words, when the idea is to show that the grade is not very precise. One traditional set of words is: "Excellent, Very good, Good, Fair, Poor, Failing."
As a grade or an evaluation, "Fair" means "acceptable, but not good."
"Would you recommend XYZ as a house painter?" "He's only fair. No complaints, but I don't think we'll use him again."