How will the Renters (Reform) Bill affect NHS organisations?24/05/23
There has been increasing media coverage in recent years concerning the unfairness of so called “no fault” evictions from residential property. As a result, the government has put forward proposals to abolish section 21 notices with the view to giving renters greater protection. Whilst these proposals will be welcome in many areas, it will create potential difficulties for NHS organisations who provide staff accommodation.
There is, as yet, no fixed date for when these changes will be introduced.
What are the key proposals in the Renters (Reform) Bill?
The key change is that Assured Shorthold Tenancies (ASTs) are abolished. This will have a big impact on staff accommodation as the majority of tenants will be in occupation under ASTs. Landlords will no longer be able to serve 21 notices (i.e. the no fault eviction notices), meaning that, in order to obtain possession, the landlord must be able to rely on one of the limited statutory grounds.
For NHS organisations, the most relevant ground is likely to be the “former employee” ground, and this will become a mandatory ground. As a result, when a tenant leaves their employment with the NHS organisation, you will have grounds to obtain possession (meaning that NHS organisation can ensure that the staff accommodation remains purely for its staff). This ground is also being extended to include where the tenancy was not meant to last for the duration of the tenant’s employment and the accommodation is required for a new employee. It is not clear how this ground will work in practice.
Other new grounds are being introduced, and include:
- an intention to sell
- the landlord is themselves a lessee and their lease is set to end.
Prior to the introduction of the reforms, landlords will have the opportunity to serve section 21 notices on existing tenants. If they do not, and the tenant remains in occupation, the tenancy will automatically become an assured tenancy.
- service of an invalid termination notice will be a criminal offence. This means that a notice cannot be served if a landlord knows that, for whatever reason, it is invalid
- in order for a termination notice to be valid, the landlord must have complied with the requirements to protect a tenant’s deposit
- provisions to ensure that landlords do not unreasonably withhold consent when a tenant requests to have a pet in their home (and the tenant is able to challenge unfair decisions).
It is intended that these changes are coupled with an improvement in the Court process for obtaining possession orders (which can sometimes take months). However, limited details of the proposed reforms have been provided at this stage.
What should NHS organisations do at this stage?
NHS organisations with staff accommodation should undertake a review of all their tenancies as soon as possible. If accommodation is currently let to a non-member of staff, you may wish to take steps to obtain possession from that tenant prior to the introduction of the reforms. Otherwise, you may not have grounds to obtain possession should you wish to do so in due course.
The tenancy agreement and any staff accommodation policy should make it clear that the accommodation is only intended for employees of that NHS organisation.
If you currently take a deposit from tenants, these deposits must be checked to ensure that you have complied with the statutory requirements. We can provide further details on the requirements and assist in any tenancy review if required.
How Capsticks can help
We have a team with expert knowledge of staff accommodation and the challenges facing NHS organisations who provide it. Whilst the proposals may bring some benefits to NHS organisations (mainly, that the proposals include an intention to speed up the Court process), they will also present a number of difficulties.
We can advise on amendments to existing tenancy agreements, steps that should be taken prior to the introduction of the reforms and the requirements following their introduction.
If you have any queries around what's discussed in this article, please speak to Abi Condry or Rachel Whale to find out more about how Capsticks can help.