Minimum standards established for pub tenants

The six regulated pub companies have established new minimum standards to support tenants on short agreements

In a significant move aimed at enhancing fairness in the pub industry, six regulated pub-owning businesses have collaborated with the Pubs Code Adjudicator (PCA) to implement minimum standards for tenants operating under short agreements. These short agreements, commonly referred to as tenancies at will, allow tenants to start running a pub while negotiating a longer-term partnership. This arrangement is especially beneficial for both parties, providing a chance to gauge the viability of their business relationship and allowing new operators to acclimatise to the trade.

Despite the advantages of these short agreements, tenants often lack the full protections afforded by the Pubs Code, which primarily applies to longer-term tenants. Nevertheless, those entering into short agreements are entitled to specific information from their pub companies and must be encouraged to complete an entry training programme unless they possess adequate business experience. A short agreement is defined under the Pubs Code as any tied tenancy that permits a tenant to occupy the pub for less than 12 months.

Responding to the need for clearer guidelines, the regulated pub companies have aligned their practices with the PCA’s expectations, formulating minimum standards that provide transparency and set clear expectations for tenants. Fiona Dickie noted “Everyone wants tied tenants to do well, and getting off to a strong start is essential. Those on tenancies at will and other short agreements are entitled to be treated fairly.” She emphasised the importance of informing tenants against making personal investments in the pub under agreements that can be terminated swiftly.

This initiative, which is largely a reflection of existing business practices, aims to foster a better business environment, ensuring that tenants are aware of their rights and obligations. The new minimum standards document can be accessed on the GOV.UK website, reinforcing the commitment of regulated pub companies to support their tenants above and beyond the existing requirements of the Pubs Code.