Service tenancy

The term 'service tenant' describes an employee who is not a service occupier, and whose occupation satisfies the normal requirements of a tenancy.

This content applies to Scotland

Definition of a service tenancy

The term does not have a special legal meaning, but is a general one to describe an occupier who also happens to be employed by their landlord. For example, a local authority may specifically grant tenancies of its properties to key workers such as teachers and social workers, or a private employer may rent a flat to one of its employees.

A common feature of service tenancies, that often excludes them from statutory protection, is the existence of a low rent or the absence of rent altogether. Both the Rent (Scotland) Act 1984 and the Housing (Scotland) Act 1988 exclude tenancies where the rent is below a certain amount. It is common for service tenants to pay no rent, but it may be possible to prove there is some consideration in the form of reduced wages. However, in order to be statutory protected, a tenant would need to quantify an amount above the low rent limits, for example, by referring to wage rates for non-tied workers in similar employment.

Although the accommodation may have been provided in connection with employment, it is possible that a regulated, assured or common law tenancy may have been created. A let by a local authority, Registered Social Landlord, or Scottish Water, to an employee as part of their contract of employment, will not be a Scottish secure tenancy. [1] For more information, please see the page on landlord is LA, RSL or Scottish Water.

Eviction from a service tenancy

If a tenancy has been created the procedures for eviction respective of the tenancy type will apply. There are grounds that relate to tied accommodation specifically.

Assured tenancies - ground 17

Ground 17 states: 'The house was let to the tenant in consequence of his employment by the landlord seeking possession or a previous landlord under the tenancy and the tenant has ceased to be in that employment.' [2]

There is no requirement to show that the house is reasonably required for another employee, but as the ground is a discretionary ground, it is likely that the landlord will have to provide a reason for possession of the property being required.

For more information about possession procedures, please see the section on assured tenancies.

Regulated tenancies - case 7

Case 7 can be stated where the tenant was an employee and the property was let to him/her as a consequence of his employment and the employment has now ended. The accommodation must be reasonably required for occupation by a current employee. Case 7 can also be cited if the property is required for occupation by an employee if they are a farm worker, even if the current tenant was not in the employ of the landlord. [3] If the landlord misuses case 7, for example, possession of the property is not required for an employee, the ejected tenant may have a claim for damages. [4] For more information on possession procedures, please see the section on regulated tenancies.

Service tenancies and relationship breakdown

The provisions under the Matrimonial Homes and Civil Partnerships legislation for the court to transfer a tenancy to the non-entitled spouse or civil partner does not apply to property let in connection with the tenant's employment. [5] If a property is let to an employee in connection with his/her employment the court cannot grant an exclusion order excluding the employee from the property. [6] Please see the section on relationship breakdown for more information.

Service tenancies and Housing Benefit

If a person occupies a property as a condition of their employment, s/he will not be entitled to Housing Benefit for any rent charged for that property. [7] As a service tenancy is not let as a condition of employment, this provision should not prevent a service tenant from claiming Housing Benefit. For more information about making a claim, see the section on Housing Benefit.

Last updated: 29 December 2014

Footnotes

  • [1]

    sch.1 para 1 Housing (Scotland) Act 2001

  • [2]

    sch.5 part II ground 17 Housing (Scotland) Act 1988

  • [3]

    sch.2 part I case 7 Rent (Scotland) Act 1984

  • [4]

    s.21 Rent (Scotland) Act 1984

  • [5]

    s.13(7) Matrimonial Homes (Family Protection) (Scotland) Act 1981 and s.112(8) Civil Partnership Act 2004

  • [6]

    s.4(3)(b) Matrimonial Homes (Family Protection) (Scotland) Act 1981 and s.104(3)(b) Civil Partnership Act 2004

  • [7]

    reg 9(1)(i) Housing Benefit Regulations 2006 SI 2006/213 and reg 9(1)(i) The Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006 SI 2006/214