Landlords of residential properties take heed: Landlords and letting agents are still obliged to conduct right to rent checks

In Joint Council for the Welfare of Immigrants v Secretary of State for the Home Department it was held that the Right to Rent Scheme ("Scheme") causes discrimination on grounds of race and nationality and breaches the Human Rights Act. The judge in the case said that the Scheme is incompatible with the right to freedom from discrimination and has had "little or no effect" on the Government's aim of controlling immigration and any effects of the Scheme are "significantly outweighed by the discriminatory effect" by those with the duty to perform the required checks, that any further roll- out of the Scheme would be "irrational" and there is convincing evidence that it "causes landlords to behave in a discriminatory way". However, there are no immediate changes to the operation of the Scheme as right to rent checks are still required in legislation.

The right to rent

The Scheme was launched in February 2016 (in England only) under the Immigration Act 2014. The Scheme has not yet been implemented in Scotland, Wales or Northern Ireland. The Scheme's aim was to prevent illegal immigrants from accessing the private rental sector coupled with the intention of tackling unscrupulous landlords who exploit vulnerable migrants, sometimes in very poor conditions. The Right to Rent legislation provides a Code of Practice which can be viewed here. It sets out what landlords are expected to do.

Right to rent checks

Under the Scheme:

• private landlords of residential properties are required to check the immigration status of prospective tenants (and other occupiers e.g. lodgers) to ascertain whether they have the right to be in the UK and can legally rent a residential property in England. The policy also affects commercial landlords if they own residential property (for example, residential flats in mixed developments/ over retail units).
• the checks must be carried out before the start of the tenancy, on all people aged 18 or over who will live at the property as their main home, whether they are named in the tenancy agreement or not.
• Certain types of property are exempt such as social housing, some student accommodation and leases of seven years or more of residential property.
• A contravention of the right to rent requirements can result in a fine of up to £3,000. However, if landlords knowingly rent out their property to an illegal immigrant, or have reasonable cause to believe that the tenant has no legal right to remain in the UK, this amounts to a criminal offence which can attract an unlimited fine and up to five years in prison. 
• A landlord may have a defence where it takes reasonable steps to terminate the tenancy within a reasonable time of becoming aware of the true immigration status of the tenant. However, the termination process involves obstacles which must be overcome, despite the Immigration Act 2016 introducing provisions making it easier to evict illegal immigrants.
• Landlords can pass responsibility for rent checks onto letting agents, but this has to be clearly agreed as part of the landlord’s contract with the agent.

What happens next?

Landlords and agents must, at least for the time being, comply with the Scheme and carry out right to rent checks as the legislation which introduced the Scheme still remains in force.

The Government has been granted leave to appeal the decision. The Government has reiterated that it is committed to tackling discrimination in all its forms and landlords must not discriminate against anyone on the basis of their colour or where they come from. It has stated that the rent checks apply equally to everyone seeking to rent property and the law remains absolutely clear that discriminatory treatment on the part of anyone carrying out the checks is considered to be unlawful. 

The final nail in the coffin for the Scheme has not been hammered… at least not yet. Watch this space for the outcome of any appeal but, in the meantime, continue to carry out right to rent checks.