Immigration Act 2014

Location

Part 3 Chapter 1 deals with the supply of services in the form of residential tenancies. Specifically, sections 20-37 and Schedule 3, which list excluded tenancies such as local authority tenancies, social housing etc.

It is interesting that, in the Impact Assessment, Government estimates that it will cost landlords £22.6 million to learn about their responsibilities and a further £18.25 million for the cost of actually carrying out the checks!

Figures suggest that there are currently about 500,000 illegal immigrants (Home Office figures). The estimate is that these new measures might result in something like 300 illegal immigrants leaving the UK each year.

Landlords have to check documents from an approved list to ensure that the tenant (and any other adult occupiers) have a right to reside in the UK. If there is any ambiguity, there is a helpline to call for clarification or a special web form.

The legislation was originally rolled out in a limited area of the Midlands before being more widely rolled out to the rest of England from 1 February 2016.

The estimate is that it will take between 30 minutes and two hours to learn what is required for compliance. A major issue will involve understanding the different documents that are acceptable in various situations.

The basis of the landlord’s obligation is to check documents. It is important to note that these should be checked for all applications not just those “considered foreign”. For EU citizens, checking and copying the passport will be sufficient. The list of different documents for various situations is shown below. It may also involve checking a UK-issued Biometric Residence Card which includes an expiry date or visa stamps in passports.

Accepting that some UK citizens will not have a passport, other identification can be used from the approved lists. For many agents, they may already be doing this as part of referencing so it should not be totally new to them.

Landlords and agents should ensure the right to rent obligations are fulfilled in all lettings in which they are involved. The consistent advice has always been to check and ensure that you keep evidence of such a check. In simple terms, this will maintain your statutory excuse and therefore remove any risk of you being penalised for allowing someone without the “right to rent” to occupy.

One area of concern surrounds the claim by third party referencing companies that such checks can be completed on your behalf. The legislation is very clear that any documentation used to maintain a statutory excuse must be checked “in the presence of the document holder” (or by live video link) which therefore, by implication, eliminates the use of a referencing company. This is because the person doing the checks must be holding the original documentation while face to face (or live video link) with the applicant. Obviously, they could be used for secondary guidance when dealing with a visa or less common documentation but in the main, their services are not required for the purposes of complying with the legislation.

The Legislation

Section 20 contains a number of definitions specifically that the word “tenancy” includes tenancies, licences, sub-letting and an agreement to lease and the word “landlord” should be read accordingly. It is a requirement that the occupier is using the property as their only or main home (therefore cutting out holiday lets) but could include long-term residents in hotels. As it includes licences, it will capture resident landlords (which would also include tenants sub-letting).

In deciding if this is the only or main home the following factors are suggested for consideration:

• More time spent there than the other home in the UK.

• If they would give that address on paperwork (probably tricky to know before they even take on the property!).

• They suggest a test of “residing”, e.g. finding bed sheets or laundry at the property (but then you would find that in a holiday let!)

• Finally, they suggest that if this is the closest home to a school their children attend, it would be the only or main home.

  Section 21 deals with a slightly complex definition of “P” and if they are not relevant nationals, they do not have a right to rent nor do they have the right to enter or reside. If they fail all these tests, it would be an offence to let a property to them.

  Relevant national means a citizen of the UK, EEA and Switzerland. The EEA is the EU along with Norway, Iceland and Liechtenstein. The following are likely to seek EU membership at some stage: Iceland, Montenegro, Serbia, Macedonia and Turkey. There is also an expectation that Albania, Kosovo, Bosnia and Herzegovina will also be seeking to join so the concept of “relevant national” seems certain to change. It is unclear what will happen post Brexit.

  In section 21(4) they define a “limited right to rent” as meaning a person with a limited right to enter or remain in the UK or who is not relevant national and has an EU right to remain (as opposed to a UK right to remain).

  Section 22 makes it an offence for a landlord to authorise occupation by an adult for someone who is disqualified from renting by virtue of their immigration status. 22(4) applies two different sets of tests. Those who are disqualified by their immigration status applies to three groups of people. The tenant, other adult occupiers named in the agreement or an adult not named in the agreement. This test applies at the time of entry.

  The rules are slightly different for those with a limited right to rent as it may not be unlawful to allow them to enter but the right to remain may lapse.

  Offences therefore fall into two threads, post-grant contravention and pre-grant contravention.

  The legislation includes a specific prohibition on seeking to circumvent the legislation through wording in the agreement. Simply writing in the agreement that those without a lawful right may not live there will not provide a sufficient defence. It may be unlawful to allow someone to occupy, but the unlawful occupation does not remove the tenancy rights and conditions.

  Section 23 deals with a limit on the penalties for landlords. It simply expresses it as a maximum of £3,000 per adult and is a civil, not a criminal penalty. Note that it is £3,000 per person and though they talk in the guide about a reduced figure for a first offence that is only true if there is only one unlawful adult. If you have more than one adult, the full penalty can apply on the first offence. There will be 28 days to pay and the guidance suggests there will be an early payment reduction of 30% for payment in full within 21 days.

  It is important to understand that the primary responsibility will be with the landlord, not the agent. They say a superior landlord could accept liability for sub-letting, if contractually agreed, but it seems hard to understand why a superior landlord would accept such a risk.

  The guidance refers to six different notices. The Referral Notice lets you know the case has been referred to the Home Office (an investigation is underway). You may receive an Information Request asking for more information to help them consider the case. If they decide you are guilty, you will receive a Civil Penalty Notice. If you have a tenancy with an illegal immigrant but the tenancy commenced before the requirement to do the ID checks, you will be given a No Action Notice indicating case closed. You will not then have been considered to have breached the law and they may provide advice on what you should be doing now.

  On receipt of the Civil Penalty Notice, you will have 28 days in which to object using an Objection Form, the content of which is prescribed. Having considered your objection, you will be sent an Objection Outcome Notice notifying you of the outcome of their consideration of your objection. If they decide from your objection that you are still liable to the penalty and the penalty is raised you, will receive a Penalty Notice.

  Section 24 covers excuses for a landlord. For example, for a pre-grant contravention the penalty can be avoided if it can be shown that the actions of the landlord were compliant with the requirements before the tenant moved in, or the breach was the fault of an agent (see later). For a post-grant contravention (i.e. the occupier loses their right to rent), then a penalty can be avoided if the landlord has notified the Secretary of State as soon as reasonably practical of the contravention (therefore allowing them to know there is an illegal immigrant at that location) or that the breach was the fault of an agent or that the eligibility period of the occupier has not yet expired.

  Section 25 closely mirrors section 22 but this time applies where the offence is committed by an agent. It is interesting to note that the offence is committed “if (and only if)” the agent acts in the course of a business and there is a written agreement that the obligation to check immigration status is to be completed by the agent. The presumption therefore is that the landlord remains liable even if an agent is doing the work. If the landlord suffered a loss as a result of the agent’s failure to do a good job it is quite possible they may seek damages for that loss. Terms of business need to be carefully considered and possibly revised to cover this (and the costs of the checks).

  Penalties for agents basically mirror those for landlords,

  Section 26 covers excuses for agents and these reflect the excuses available for landlords in both the pre-grant and post-grant contraventions.

  Section 27 deals with those with a limited right to remain, i.e. there is a time limit on the right to remain. Their eligibility period before renewed eligibility checks have to done is the longer of one year from move in or the remaining time they are allowed to remain. For those with indefinite leave to remain (eg UK nationals), there is no need to check their status again.

  For example, someone with six months’ right to remain on move in will have to be checked after 12 months. Someone with two years’ right to remain will have to be rechecked after two years. Clearly, a reliable diary system will be needed to ensure compliance.

  Section 28 deals with general issues around penalty notices and prescribes things like the content of penalty notices. These cannot be given if the unlawful occupant has moved out more than 12 months ago.

  Section 29 list “objections”, i.e. reasons a recipient may object to the penalty notice on grounds there is no offence, they are not the right person or the amount is too high.

  Section 30 details the process for appealing a penalty notice decision. It is noteworthy that the objection process has to be gone through before there is any right to appeal. The appeal would be to the county court in the first instance.

  Section 31 deals with enforcement of any sum payable to the Secretary of State under these rules. Even if it has not been to court, money is recoverable as if it were under an order of the court i.e. the use of an attachment to earnings, charging orders, bailiffs etc are all available.

  Section 32 then goes into a collection of ‘general matters’ and requires the Secretary of State to provide a code of practice including factors to be considered in deciding criteria for penalty. The code may also contain guidance on only or main residence, what steps should be taken to know who is occupying the property and how to avoid falling foul of the Equalities Act 2010. The general code can be accessed at https://www.gov.uk/government/publications/right-to-rent-landlords-code-of-practice/code-of-practice-on-illegal-immigrants-and-private-rented-accommodation-for-tenancies-starting-on-or-after-1-february-2016 and the equalities specific code can be accessed at https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/376789/Code_of_Practice_for_Landlords__web_.pdf .

  Section 35 deals with transitional provisions and clarifies that these checks do not apply to existing tenants, even on renewal to the same people.

  This new legislation implies a number of practical actions, changes to procedure and changes to documentation which will be required.

  It may have been recommended before but it now becomes essential to ask who will be occupying the property and to have a clause in the tenancy prohibiting occupation by any others.

  Once you know who will be occupying, you will need to collect ID for every adult occupier (check the ages of those approaching adulthood on suitable documentation).

  Copy the ID and keep for at least 12 months after they leave. It is acceptable to use electronic copies. Remember that this is personal data so holding it should fall within General Data Protection Regulations and you should ensure it is stored securely and not kept for any longer than necessary. You are required to take “reasonable” steps and this would include spotting obviously fake documents and keeping records of the checks you have carried out.

  Diarise ID checks for those with a limited right to remain to ensure you stay within the law, the later of 12 months or the expiry of the right.

  To avoid being accused of discrimination, there should be a policy of copying ID for all adult occupiers. Do not ask for this before you have agreed a property rental but complete it before granting the tenancy. The guidance suggests that you let all applicants know you will be doing ID checks and even putting it in adverts.

  The guidance provides the following documents for different groups of people. EEA adults, a current or lapsed EEA passport, EEA National Identity Card or UK Biometric Residence Permit showing permission to stay, all with a recognisable photo and the right personal details (e.g. correct age, gender, date of birth etc).

  For non-EEA adults, you will need to also check their right to remain in the UK based on the passport stamp, visas, Biometric Residence Permit or Asylum Registration Cards. Again, check correct age, gender, date of birth etc. However, here you will also need to check and record expiry dates.

  The non-EEA adults you are allowed to rent to for an indefinite period are those with: indefinite leave to remain, indefinite leave to enter, “no time limit” endorsement or a certificate of a right to abode. In all cases, take copies of these consents and keep for one year after they leave.

  Immigration Act 2016

  Hot on the heels of the Immigration Act 2014, the Government passed the Immigration Act 2016. This inserts several new sections into the Immigration Act 2014, specifically sections 33A to 33E. The main changes are:

• Make it easier for private landlords to evict illegal migrant tenants.

  It allows a landlord to serve a minimum 28-day notice to quit to the tenant, if they are made aware that the property is being occupied by persons who do not have the “right to rent”. This could potentially allow the landlord to remove the tenant without the need for a court order in certain circumstances. There is also a new Ground 7B in schedule 2 for eviction of unlawful occupiers.

• Create new criminal offences for rogue landlords and agents who repeatedly fail to carry out right to rent checks or fail to take steps to remove illegal migrants from their property.

  This will add a criminal element to the current civil penalty. Therefore, a landlord or agent could face a five year prison sentence in addition to an unlimited fine for continued breaches of the legislation.

  The 2016 legislation also introduced two new systems for seeking possession of a property where you receive one or more notices from the Secretary of State indicating that one of the occupants of a property is unlawfully in the UK and therefore not entitled to be renting the property.

  In the first case, where one or more notices cover all the occupants of a property, then the landlord or agent can serve a statutory notice for 28 days. At the expiry of the statutory notice it is as though you have obtained a possession order and you can move to going straight to bailiffs to evict (if the occupants are still there). The notice can be given to the tenants, posted to the tenants or left at the premises (this is stated in the legislation).

  The statutory notice is prescribed in The Immigration (Residential Accommodation) (Termination of Residential Tenancy Agreements) (Guidance etc.) Regulations 2016.

  Though there is this statutory notice you should seek to end the agreement in the most effective, but lawful, manner and this might be by the tenant surrendering the property up. Guidance on this can be found in https://www.gov.uk/government/publications/ending-a-residential-tenancy-agreement.

  Once expired, the notice is enforceable as an order of the High Court, meaning that after the 28 days have elapsed the landlord can immediately go to a High Court Enforcement Officer to enforce possession. This avoids the delays typically associated with the county court bailiffs.

  In the second case, the notice from the Secretary of State may only identify one or more of a group in a property, but not all of them. In this case, a new ground 7B inserted into the Housing Act 1988 by section 33E of the Immigration Act 2014 gives a new mandatory right to possession or some other action. The last statement may seem unusual but it is because the judge could award possession or they could order the tenancy to be transferred into only the names of those who are there lawfully. As a mandatory ground they must “do something” but it does not have to mean awarding the property back to the landlord. This would not be fair on those who are lawfully residing there.

  Ground 7B would go on the usual section 8 notice, with or without other grounds and must be a minimum of 14 days long before applying to the court.

  In Practice

  In practical terms landlords and agents need to:

  1) Establish which adults will be living in the property as their only or main home (no right to rent checks are needed for under 18 year olds as their right to be in the UK is presumed to be dependent on the status of their parents). Note it does not matter if they are formally tenants or just living with the tenant; they all count.

  2) Obtain original copies of suitable documents for each adult occupier.

  3) In the presence of the document holder (or by live video link) check the original document you are holding matches the person in front of you or on the screen. It should be noted that if the person has a limited right to rent (i.e. they are allowed to be here but only for a limited period of time), the face to face checking must take place no more than 28 days before the tenant is due to move into the property. This does not apply to those with an unlimited right to rent (as obviously it will not change).

  4) Copy the documents noting the details of who and when it was checked.

  The guidance (page 21) gives “List 1” and “List 2”. List one is for those with an indefinite right to remain in the UK and List 2 is for those with a time limited right to remain.

  List 1 is then further split into “Group 1” and “Group 2”. If the tenant can provide one document in Group 1, this will be sufficient. A passport is usually the easiest way to do this, but not every UK national will have a passport. If documents from Group 1 are not available then the statutory excuse can be achieved by seeing two documents from Group 2.

  For List 2 there is only one set of documents and only one document is needed. Obviously, anyone coming to the UK would be expected to have travel documents to enable them to come to the UK so the issue of not having a passport or similar is less likely to arise. If someone like an asylum seeker gets to the UK follow a traumatic escape from their home country it is possible that they may not have documents on arrival but the Home Office will then issue documentation explaining their rights.

  For those needing to rely on List 2, a time limited right to remain, it will be necessary to check the right to remain again at some future date and this should be entered into a diary system.

  Immigration (Hotel Records) Order 1972

  It can be argued that the lack of knowledge about The Immigration (Hotel Records) Order 1972 (the IHRO), is because the IHRO is not often enforced in the rented sector. It is easy to be misled by the word “hotel” and think that this legislation only applies to those involved in tourism. However, it applies to all providers of accommodation.

  “This Order shall apply in the case of any hotel or other premises, whether furnished or unfurnished, where lodging or sleeping accommodation is provided for reward, not being premises certified by the chief officer of police of the area in which they are situate to be occupied for the purposes of a school, hospital, club or other institution or association.”

  The legislation makes the “keeper” liable and defines them as: in relation to any premises, includes any person who for reward receives any other person to stay in the premises, whether on his own behalf or as manager or otherwise on behalf of any other person.

  This would include a private landlord managing his own property but would also include the landlord using an agent as well as the agent themselves.

  What does it entail?

  Accommodation providers are required to collect the full name and nationality of those who will reside in the property and are 16 years or older.

  The Immigration Act 2014 requires letting agents to ensure those over 18 living in rented properties have the right to rent. This is usually determined through establishing nationality by checking passports. To provide a statutory defence to this offence, a copy of the identity documents should be kept. Fortunately, for most occupiers over 18 this will give the nationality information needed to comply with the IHRO.

  However, many agents will not have the relevant information for occupiers aged 16 and 17 — nor for tenancies that commenced prior to introduction of the right to rent checks. The full names and ages of children may be contained within their parents’ / guardians’ referencing forms but this will depend on the agent’s documentation.

  In addition to the requirements above, article 4(1) of the IHRO explains that a person aged 16 or over and who is an ‘alien’ must (a) on arriving at the premises, inform the keeper of the premises of the number and place of issue of his/her passport, certificate of registration or other document establishing his/her identity and nationality; and (b) on or before his/her departure from the premises, inform the keeper of the premises of his next destination and, if it is known to him/her, his/her full address there.

  Whilst ‘alien’ is not a word we would normally use, the current definition is someone who is not a Commonwealth citizen, nor a British protected person nor a citizen of the Republic of Ireland and these points are defined in section 50 of the British Nationality Act 1981.

  The order also requires the accommodation keeper to obtain and retain details of the next known destination for all ‘aliens’; this does not necessarily need to be the full address although it should be the full address if the person knows it. In some cases, this information may have been obtained in order to facilitate a deposit return or the transfer of utility accounts at the end of a tenancy. In other instances, and more commonly in today’s world, the agent may have returned the deposit via the banking system and may not have contractual liability to transfer the utilities on the landlord’s behalf. In both of these situations, the accommodation provider is unlikely to have requested the address of the next known destination.

  It is important not to confuse the next known destination of the ‘alien’ with the post-tenancy contact address which forms part of prescribed information in relation to tenancy deposits. A post-tenancy address does not have to be the address where the tenant will reside at the end of the tenancy. It can, for example, be the address of a friend, relative, employer or guarantor, whichever is the most convenient for the tenant.

  In practice

  Although the IHRO is not well known, the right to rent checks are and any landlord or agent complying with these will be a significant way towards complying with the IHRO.

  The potential points of failure are likely to be 16 and 17 year olds, caught by IHRO but not right to rent checks, but a simple change to the system would solve that. The secondly failure is likely to be around obtaining the next destination information. Doing the same thing for all residents 16 and over may be a simple way of complying.

  Information retention

  Article 5 states that the information relating to a person staying at the premises must be kept for a period of at least 12 months.

  It does not clarify if this is from the point of taking the information or departure, but right to rent check information should be kept for at least 12 months beyond the departure of the tenant so would cover either period.

  As a practical solution, and to ensure compliance, writing the next known destination on the back of the right to rent check documents and filing them for destruction at 12 months following the end of the tenancy will ensure compliance with the Immigration Act 2014, the IHRO and the General Data Protection Regulations.

  Having to destroy the documentation at 12 months following the end of the tenancy will mean that proving compliance will be limited to those tenancies that have ended within the last 12 months. Agents will have to decide if they want to try and contact all aliens who have left in the last 12 months to establish the address to which they moved. This will also be a question of balancing the risk of getting caught with the effort needed to comply.

  Committing a breach

  The order does contain a power of enforcement and any keeper may be liable to prosecution for:

  1.         Not keeping a record;

  2.         Not recording the details of everyone 16 or over;

  3.         Not opening the record for inspection when required to do so by a constable or person appointed by the Secretary of State.

  It is also an offence for a person to give you incorrect details or to fail to provide the required information. The maximum punishment on conviction is currently an unlimited fine and/or six months in prison. This could be damaging for a small business or independent landlord as the fine is awarded per breach, i.e. having three occupiers is three breaches.

  Right to rent checks are not required for children under the age of 18, although you are required to satisfy yourself that the child is in fact under the age of 18. Further checks are not required if the child turns 18 during the tenancy, unless and until the tenancy is renegotiated, or a repeat right to rent check is required. Completing the checks, as suggested, on all occupiers aged 16 and above may aid in complying with the right to rent checks for children that turn 18 and when a tenancy is renegotiated.

  Audit

  Finally, it is worth being aware that article 5 of the IHRO specifies that every record shall at all times be open to inspection by any constable or by any person authorised by the Secretary of State.

  Although this piece of legislation is unlikely to be well known within the private rented sector, it does apply and should be given due consideration.

Venue Facilities

Directions