How Some Companies Have Quietly Operated Outside the Law for Decades

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For many people in the UK, finding a safe, stable place to live is hard enough. Add to that the stress of being on benefits, whether Universal Credit, PIP, or LCWRA, and the search often becomes impossible. But what if the problem wasn’t just lack of housing stock, high rents, or rogue landlords?

What if the real issue was that some housing providers have been operating outside the law for years, even decades, without anyone noticing?

This article explores a quiet but deeply troubling problem in the UK housing system:licensed property managers and guardian providers who appear to sidestep basic legal obligations, such as belonging to a redress scheme, or following equality law, and what this means for tenants, especially disabled claimants.

The Law Is Clear: Discrimination Based on Benefits Is Unlawful

In 2020, a landmark County Court ruling confirmed what many campaigners had long fought for: blanket bans on tenants receiving benefits are unlawful.

This was established in the case of Tyson v. Bradford and others (2020), where the judge ruled that rejecting someone solely for being on benefits (such as “No DSS” policies) constituted indirect discrimination, disproportionately affecting women and disabled people.

This built on the broader protections provided under the Equality Act 2010, which outlines how people with protected characteristics, including disability must not be discriminated against in services, housing, or employment.

What the Equality Act Says And Why It Matters

The Equality Act 2010 is the legal foundation for protection against discrimination in the UK. Here are the most relevant parts for tenants:

Section 13 – Direct Discrimination

A person discriminates against another if they treat them less favourably because of a protected characteristic.
Read it here

In housing, this means a disabled person cannot be treated worse simply because of their condition or support needs.

Section 15 – Discrimination Arising from Disability

It is unlawful to treat someone unfavourably because of something arising from their disability (e.g., needing PIP or LCWRA), unless it’s a proportionate means of achieving a legitimate aim.
Read it here

If someone is refused housing due to receiving disability-related benefits, this may qualify as a breach.

Section 19 – Indirect Discrimination

Applying a general policy (like “we don’t accept benefit claimants”) that disproportionately affects disabled people is unlawful unless objectively justified.
Read it here

Section 29 – Provision of Services

Housing providers must not discriminate in the way they offer services to the public — including access to accommodation.
Read it here

Redress Scheme Membership: A Legal Requirement, Not a Suggestion

Since 2014, anyone engaging in letting agency or property management work in England must belong to a government-approved redress scheme.

This includes companies managing properties, placing tenants or guardians, collecting fees, or organising occupancy agreements. The schemes are:

The Property Redress Scheme (PRS): https://www.theprs.co.uk/
The Property Ombudsman (TPO): https://www.tpos.co.uk/

This isn’t optional. It’s written into the Redress Schemes for Lettings Agency Work and Property Management Work (Requirement to Belong to a Scheme etc.) (England) Order 2014.
Read it here

If a company isn’t listed in either scheme, they are operating in breach of UK law. Trading Standards can fine them up to £5,000 per breach, and tenants may have grounds for civil action.

The Loophole: Guardian Schemes and Regulatory Grey Zones

One growing trend in the UK is the use of property guardian schemes , where individuals are placed in disused or vacant buildings, often under “license agreements” rather than tenancy agreements. These companies claim they are not letting agents or landlords, and therefore not bound by some legal protections.

In reality? Many do everything a letting agent does:

Advertise available housing,
Collect monthly payments (rent or licence fees),
Set rules, restrictions, and notice periods,
Communicate with occupants as property managers.

Yet some of these companies are nowhere to be found in the redress scheme registries.

Even more concerning, some are actively excluding people on benefits , even when those benefits are clearly linked to disability, and even after being warned that this is likely unlawful.

Why This Matters And What It Means for All of Us

Discrimination in housing isn’t always obvious. Sometimes it’s dressed up as “eligibility criteria.” Other times, it’s buried behind vague policies like “must be working” or “guardianship model.”

But the impact is the same:

Disabled people denied housing.
Benefit claimants silently excluded.
Vulnerable renters treated as disposable.

And when the companies doing this aren’t even registered with a redress scheme, there’snowhere to formally complain, and no oversight to stop it.

That’s not just a gap in regulation, it’s a loophole big enough to bury justice in.

What You Can Do

If you’ve been refused housing based on receiving benefits, especially disability-related, you may have a legal case.
If you suspect a company is operating outside the law, check the redress scheme registries (PRS or TPO) for their exact trading name.
Report failures to:
- Trading Standards via Citizens Advice: https://www.citizensadvice.org.uk/consumer/get-more-help/report-to-trading-standards/
- Or directly to PRS or TPO if they falsely claim membership.

Final Thoughts

Housing law in the UK is clear, but enforcement is weak. Some companies know this. They exploit it. And unless someone challenges them, they get away with it.

But it only takes one person, one case, or one post to shine a light on a system that was never supposed to be invisible in the first place.

The Toolbox: 9 Ways to Fight Back Without Moving to Mars