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Private sector

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This section looks at the security of tenure of service tenants in the private sector.

The security of tenure of service tenants in the private sector depends on whether the agreement started before or after 15 January 1989 and, if the latter, any written tenancy agreement.

Agreements on or after 15 January 1989

Service tenancies created on or after 15 January 1989 that satisfy the requirements of an assured tenancy come under the protection of the Housing Act 1988. However, the tenancy is an assured shorthold tenancy if:

  • it started between 15 January 1989 and 27 February 1997 and an assured shorthold tenancy was specifically created, or
  • it started on or after 28 February 1997 and an assured tenancy was not specifically created.

For more information, see the section on Assured tenancies and the section on Assured shorthold tenancies.

The Housing Act 1988 has a special ground for possession – Ground 16 – that applies to service tenants. This ground applies where the premises were let to the tenant in consequence of her/his employment that has now ceased.[1] This is a discretionary ground, which means that the court must agree that it is reasonable for possession to be granted. However, unlike the ground for Rent Act tenants described in 'agreements before 15 January 1989' below, the employer does not have to prove that s/he needs the premises for another worker.

If the service tenant is an assured shorthold tenant, then it is unlikely that the employer will use this ground. This is because it would be easier for the employer to use the proceedings specifically for the eviction of an assured shorthold tenant - for more information, see the section on Assured shorthold tenancies.

Agreements before 15 January 1989

If the service tenancy was created before 15 January 1989 and satisfies the requirements of a regulated tenancy (see the section on regulated (protected) tenancies for more information), then the service tenant will have the protection of the Rent Act 1977. The Act contains a ground for possession – Case 8 – that specifically applies to service tenants. It applies where:

  • the premises were let to the tenant by the employer in consequence of her/his employment; and
  • the employment has now ceased; and
  • the premises are reasonably required for occupation by another worker.[2]

This is a discretionary ground, so the landlord must convince the court that it is reasonable to order possession as well as proving that another worker needs the premises.

If there is a resident landlord or the occupier pays for the use of furniture or services, providing there has been no change in their agreement since this date, then a restricted contract may exist (see the section on restricted contracts for details). Restricted contracts have little security of tenure, and the landlord can regain possession by serving a notice and getting a court order. There is no need for a ground for possession to be made out. Instances of restricted contracts are very rare.

[1] Ground 16, Sch.2, Housing Act 1988.

[2] Case 8, Sch.15, Rent Act 1977.

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