That's a more severe version of what my child had in elementary school. To keep classes the right size, they would have a few 1st grade classes and a few 2nd grade classes and one 1st/2nd shared classroom. Repeat for each of the following years. My child was always put in the younger half of the shared classroom. After 3rd grade the principal invited them join the regular 5th grade class and skip 4th grade altogether.
This arrangement is by design in some teaching styles, like Montessori. Unfortunately the Montessori schools in my area aged out after Elementary, would've loved to keep my daughter in that kind of environment.
