Tom sagte, sie hätten sich am Tag zuvor auf dem Schulhof versammelt.

Questions & Answers about Tom sagte, sie hätten sich am Tag zuvor auf dem Schulhof versammelt.

Why does the sentence use am Tag zuvor instead of gestern?
This is a time shift in reported speech. Tom originally said gestern (yesterday). However, because time has passed since he spoke, yesterday might no longer mean the same day to the person reporting it. So, gestern shifts to am Tag zuvor (the day before) or am Vortag to keep the timeline accurate.
Why is hätten used here instead of the Konjunktiv I form haben?
In reported speech, we usually prefer Konjunktiv I. But the third-person plural Konjunktiv I of haben is sie haben, which is identical to the normal present tense. To avoid confusion and clearly show it is reported speech, German drops down to the Konjunktiv II form: sie hätten.
Why is sich needed before versammelt?
In German, the verb sich versammeln (to gather or assemble) is reflexive when a group of people comes together. Unlike in English where you just say 'they gathered', German requires the reflexive pronoun to express that they gathered themselves.
Could we use dass (that) after sagte?
Yes, you could say: Tom sagte, dass sie sich am Tag zuvor auf dem Schulhof versammelt hätten. Notice that adding dass turns the second part into a standard subordinate clause, pushing the conjugated verb hätten to the very end. Leaving dass out is very common in reported speech and lets you use normal main-clause word order.

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