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Dozens of UK Landlords fined after roll-out of Right to Rent Scheme

19 April 2017 #Discrimination

A Freedom of Information Request (FOI) has revealed that financial penalties totalling £37,000 were handed out in the first 8 months after the Right to Rent scheme was rolled out across England. The fines were issued to 62 landlords between the start of February and end of September last year.

Commenting on the FOI, Chris Norris, Head of Policy at the National Landlords Association indicated that it’s likely that landlords were “accidently falling foul of the law” rather than “deliberately or maliciously” breaking the rules. 

Landlord associations have raised a number of concerns with the scheme, particularly that it places an undue burden on their members. Indeed, in February 2017, the Guardian reported that the additional work by landlords was estimated by the government to cost a staggering £4.7m a year.

The Joint Council for the Welfare of Immigrants (JCWI) has also raised concerns that the scheme ‘incentivises’ discrimination against prospective tenants with more and more landlords admitting that they were less likely to rent to anyone who appeared ‘foreign’.

 

What is the Right to Rent Scheme?

As part of the government’s attempts to cut down on illegal migration, recent immigration legislation contains a number of measures to restrict access to services, in particular housing, for those without a valid right to remain in the UK. One of these measures is a requirement for private sector landlords to check their tenants’ immigration status does not disqualify them from renting property.  

The Immigration Act 2014 introduced the scheme and was first implemented in part of the West Midlands from 1 October 2014 and then expanded across the rest of England from 1 February 2016. The rules do not currently apply in Wales, Scotland and Northern Ireland but the government is committed to extending the scheme to these parts in due course.

 

How can landlords comply with the Right to Rent Scheme?

UK landlords of residential properties must carry out immigration checks to ensure that a prospective tenant has the right to rent in the UK. Not all tenancies are included but in many cases, landlords must check the status of prospective tenants to ascertain whether the tenant has the right to live in the UK.

Right to rent checks are done by:

  • Obtaining a tenant’s original acceptable document which allows them to live in the UK;
  • Checking the document with the tenant present; and
  • Copy and retaining the documents on file and recording the date of the check.

Landlords who carry out the right to rent checks in accordance to government guidance, will have a statutory excuse against a civil penalty.

 

What are the consequences of non-compliance?

Landlords can be fined up to £3,000 for failing to comply with the legal checks and could also face criminal sanctions including imprisonment. It is the responsibility of the landlord to ensure that they are aware of the current immigration laws and procedure on carrying out right to rent checks correctly and in accordance with government guidance.

Landlords who knew or who had ‘reasonable cause to believe’ that a tenant didn’t have the right to rent in the UK could be imprisoned for 5 years or get an unlimited fine. Landlords could also be fined if they rented their property to someone who did not have the correct permission to live in the UK and then couldn’t evidence that they carried out the right to rent checks.

 

What are the concerns with the scheme?

The Joint Council for the Welfare of Immigrants (JCWI) recently carried out an independent assessment of the pilot programme and their report indicated that the government’s controversial Right to Rent scheme was discriminating against potential tenants.

JCWI’s independent evaluation of the scheme revealed the following:

  • 42% of landlords said that the Right to Rent requirements made them less likely to consider someone who did not have a British passport
  • 27% of landlords were reluctant to engage with those with foreign names or accents
  • Checks were not being undertaken uniformly for all tenants but were instead being directed at individuals who appeared ‘foreign’
  • 50% of respondents who had been refused a tenancy felt that discrimination was a factor in the landlord’s decision

Rather importantly, it seems that 57% of landlords and agents in the UK felt that they had not effectively understood what was required of them with 40% in the pilot area claiming either not to have effectively understood the changes or not to have been aware of them at all.

 

What should landlords do?

Despite the concerns with the scheme, the Government is expected to extend it to all parts of the UK in the near future. The Government has a clear intention to control immigration and make the UK a hostile environment for migrants with no valid leave.

It is clear from JCWI’s report that, landlords must ensure they are familiar with their legal obligations about how to carry out right to rent checks. Currently, British and other EU nationals have an automatic right to rent provided they can show their documentation. But after Brexit, rules for the 3 million EU nationals still in the UK are likely to change, potentially making the checks even more complicated.

Landlords are advised to familiarise themselves with the legislation as failure to carry out the checks correctly could prove expensive and may lead to criminal sanctions. Further, if landlords and agents do not carry out the checks in a ‘fair, justifiable and consistent manner’ it could leave them open to claims for discrimination with compensation awards of up to £30,000.

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Afeefah Shabbir

Afeefah Shabbir
Business Immigration Solicitor

E: ashabbir@clarkslegal.com
T: 0207 539 8009
M: 0777 581 5811