Advice for landlords and employers
Advice for landlords
Most private sector landlords won’t see any change with the introduction of Universal Credit.
This is because most working age claimants in the private rented sector are already used to receiving their Housing Benefit/Local Housing Allowance payments directly from us and are responsible for paying their own rent.
Those private sector Landlords who do currently receive a managed payment from us are urged to familiarise themselves with the changes and look at how they can prepare themselves and help their tenants prepare as well.
If a tenant cannot manage and gets into arrears then it’s important to note that private landlords no longer need explicit consent from their tenant to apply for rental payments to be made directly to them.
The Department for Work and Pensions should start making payments direct to landlords if:
- a claimant is in arrears with their rent for an amount equal to, or more than, two months of their rent.
- a claimant has continually underpaid their rent over a period of time, and they have accrued arrears of an amount equal to or more than one month’s rent.
If a managed payment is not set-up by the Department for Work and Pensions then landlords can request one by completing the form on the Government’s official website.
The Government has created a dedicated page on their website for Universal Credit and rented housing which contains detailed advice. The Residential Landlords Association has also produced this handy guide.
Advice for employers
Universal Credit can benefit employers as well as individuals by creating a more flexible workforce as there is no upper limit to the number of hours people can work before losing their benefits. Instead benefits will gradually reduce as people earn more.
The Government has produced detail information to help employers with staff claiming Universal Credit which you can find here.
As an employer there are some basic things you can do to help your staff make the move to Universal Credit.
- Report PAYE information accurately and on time to HMRC. Failure to do so can lead to your staff not receiving enough Universal Credit payment or none at all which could lead to financial hardship. If you do not use the Real Time Information (RTI) system then let your employee know as they will need to report their work details themselves.
- Be open and flexible to staff requesting additional hours or ad hoc overtime. Discuss with them how they could earn more by taking on additional responsibility or upskill themselves.
- Universal Credit claimants, particularly when waiting for their first payment, can struggle to meet housing and living costs. Be aware of the financial support on offer and direct staff towards it. Alternatively, you may wish to consider advancing payments or loans to your employees that they pay back over a set period of time in a way they can afford.
- Consider paying staff monthly instead of once every four weeks. Paying staff once every four weeks can mean at certain times of the year they will be assessed as having been paid twice within one Universal Credit period. This could mean their earnings are too high and they drop out of the Universal Credit system. They will then need to reapply to ensure payments continue in the next four week cycle. This can lead to delays and financial hardship.