With a gradual easing of lockdown throughout the UK, more and more businesses are looking to reopen their doors to their employees and the general public. Many businesses will be required to adapt the workplace in order to be able to enforce social distancing measures to comply with government guidelines.
In this article, we will answer questions we have received and outline some considerations that both landlords and tenants should take into account prior to reopening their businesses.
1 – Can a tenant make physical alterations to the property?
Most leases will contain an alterations clause which sets out what the tenant can and cannot do to the property. The usual position is to prohibit the tenant carrying out structural changes or external work that alters the appearance of the building.
Other types of work such as internal changes and non-structural alterations may be able to be carried out with the landlord’s written consent.
In order to comply with government guidelines, the property may need to be altered to include social distancing signage, screens that separate working stations and changes to workplace layouts.
If there are discussions between parties about potential alterations to a property, we would advise that the terms are documented in a formal written licence. The licence should include details of the work to be carried out, plans and specifications and whether the alterations must be removed at the expiry of the lease.
2 – Is it possible to change the property to accommodate business needs?
Many businesses such as restaurants and café’s have opted to provide take away food as opposed to customers eating in as this is easier to accommodate the government guidelines. Planning rules have been relaxed to allow businesses to operate as hot food and drinks takeaways during the pandemic without a planning application. This time limited permitted development right will last for 12 months and expires on 23rd March 2021.
Tenants may also wish to use outdoor space that they may have for additional seating areas to provide more income and allow for social distancing.
Conversely, many companies have found that their employees working from home has had no impact on the business’s productivity. They are therefore likely to start thinking about whether the space they are currently leasing is still fit for purpose and whether they can downsize or sublet part of the space.
These changes would have to be agreed between the landlord and tenant and may involve taking an assignment of a lease or subletting nearby units for additional space or subletting the whole or part of their property to downsize.
3 – Who is responsible for cleaning the property?
The Landlord would be responsible for the cleaning and maintenance of the common parts of the building, such as the staircases, toilets and hallways.
Most leases also include an obligation on the tenant to keep the ‘demised premises’ clean which is likely to be enforced by the landlord to prevent a disease outbreak in the building.
4 – Will this impact the service charge?
If the Landlord is carrying out more frequent cleaning and providing additional resources around the building such as hand sanitiser and signage, they may wish to recover some of the costs of this via the service charge payable by the tenant.
Depending on the terms of the lease, it may allow for the landlord to recover the costs of this as part of the estate management.
5 – Are face coverings compulsory in the workplace?
Under current government guidelines in England face coverings must be worn in a majority of indoor settings where social distancing may be difficult. Members of the public visiting professional services such as high street law firms must wear face coverings inside, however this rule does not apply to firms who only see clients by appointment.
The rules on face coverings differ in Wales where they are currently only mandatory on all public transport in Wales – buses, trains and taxis. The Welsh Governments position on face coverings does not seem likely to change in line with England.
We at Berry Smith can assist you in reviewing the terms of leases between landlords and tenants to advise on potential obligations. For more information on the points raised or if you would like tailored advice to your needs, please contact Kelly Cassemis or Martin Pursall in our commercial property team.
Kelly Cassemis (Associate) – kcassemis@berrysmith.com
Martin Pursall (Partner) – mpursall@berrysmith.com