Running Your Business
Checks remain after Right to Rent legal impasse
The ‘Right to Rent’ requirements were introduced by the Immigration Act 2014 (‘the Act’) and prohibit private residential landlords from authorising an adult to occupy premises under a residential tenancy agreement if that adult does not have the right to reside in the UK.
The checks were piloted in Birmingham, Walsall, Sandwell, Dudley and Wolverhampton from December 2014. The Government then extended the scheme in 2016 to the remainder of England and had planned to extend the scheme to the rest of the UK.
The Act introduced the checks to deter illegal immigration and to make it more difficult for illegal immigrants to rent residential property in the UK. The legislation also made it easier for landlords to remove illegal immigrants.
Pharmacy must comply
The rules apply to all private residential landlords. As a result, if there is any residential letting as part of a pharmacy business or ancillary to it, the checks will apply. This is also sometimes the case where there is staff accommodation.
The common scenario where the Act would apply to pharmacists is a high street premises with the pharmacy on the ground floor and residential flat(s) on the upper floor(s). Where this is the case, a pharmacist would be required to comply with the checks before being able to let out any residential flat.
Pharmacist landlords need to verify the immigration status of their tenants and be satisfied that they have the right to be in the country when the tenancy is granted. It applies to all tenants aged 18 or over, if they are occupying the premises for their main residence, whether or not they are named in the tenancy agreement. In practice, this covers most Assured Shorthold Tenancies (ASTs) but also includes oral or unwritten tenancy agreements. The checks only apply to tenancies granted after 1 February 2016.
Practically, these checks require pharmacist landlords to obtain physical evidence of the tenant or occupiers’ right. The Government has prescribed specific acceptable documents which landlords can rely on. For example, a British passport, a Home Office issued biometric “residence permit” card, a current full or provisional UK driving licence.
Pharmacist landlords must retain copies of these document for the term of the tenancy agreement and for a further 12 months afterwards. Pharmacists may also need to carry out follow-up checks at least every 12 months. These are the same as the initial checks and, again, copies must be taken and held.
Failure to comply with the checks required by the Act can result in prosecution and up to five years in prison, an unlimited fine or both. The validity of the letting itself will not be affected. If prosecuted, this could leave a pharmacist facing a fitness to practise investigation.
Recent case law
The Joint Council for the Welfare of Immigrants recently sought a judicial review of the Right to Rent checks under the Act. The review sought a declaration that the Act was incompatible with the Human Rights Act 1998 and that the Right to Rent checks were causing residential landlords to discriminate against certain people on the basis of their nationality or ethnicity. A further order quashing the Government’s extension of the scheme to the remainder of the UK was also sought.
The court ruled that the right to rent checks are incompatible with the Human Rights Act 1998 and that the extension of the scheme would be a breach of the Equality Act 2010.
Despite the judgment there is currently no change to the requirement to undertake the Right to Rent checks. This is because while the declaration that the Right to Rent checks are incompatible with the Human Rights Act 1998 was made, it is not legally binding on the Government, nor does it invalidate the law or prevent it from being enforced.
The Government’s plan to roll the scheme out in Wales, Scotland and Northern Ireland is however now on hold. The existing regulations therefore continue to apply only in England.
The Government has already indicated that it plans to appeal the judgment. If it loses that appeal or does not go ahead with it, the decision on whether to repeal the relevant legislation will rest with Parliament.
What are the next steps?
Unfortunately pharmacist landlords will still need to comply with the Act and undertake the checks. The judgment is however likely to make it more likely that tenants, especially those who have been denied a letting, could make applications to court on the basis of discrimination.
Aidan Welton is a solicitor and member of the pharmacy transactions real estate team at Charles Russell Speechlys LLP
This is a general overview and we recommend that independent legal advice is sought for your specific concerns.
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