In November, the Associated Retirement Community Operators (ARCO) introduced a consumer code (the Code). Approved Subscribers to the Code will have to show high standards from the point of marketing onwards. These standards go beyond what they are obliged to do under statute.
How does a provider of retirement communities become an Approved Subscriber?
The first stage will be to become a member of ARCO. The eligibility criteria are set out on the ARCO website. Any retirement community registered with ARCO must:
- be primarily for older people;
- offer self-contained accommodation which can be purchased or rented with security of tenure;
- enable residents to take advantage of personal care that is delivered flexibly, usually by staff based on the premises;
- have care/support staff available on the premises for 24 hours a day;
- have domestic services available;
- have facilities for meals to be available in restaurants or dining area;
- offer communal facilities and encourage an active social programme;
- aim to be a home for life and enable people to "age in place".
A condition of ARCO membership is a commitment to becoming an Approved Subscriber to the Code. Before an ARCO member can become an Approved Subscriber, it must have demonstrated that it complies with the Code. Therefore, compliance must be shown before the status of Approved Subscriber will be conferred on a member.
What do Approved Subscribers need to do?
- Comply at all times with the Code in relation to the retirement communities that they have registered with ARCO.
- The Code sets out the requirements for retirement communities. For example, staff must be available on the premises for 24 hours a day, self-contained accommodation that can be purchased and/or rented with security of tenure must be offered, and an active social programme must be encouraged.
- There are detailed provisions in relation to marketing, advertising and sales material. This should be clear and accurate and should not be confusing or misleading. A consumer's wish not to receive mailshots, telephone calls, etc must be respected.
- Consumers should not be put under pressure to join the retirement community and must be given sufficient time to digest information and ask questions before making a formal commitment. Additional care must be taken where the Approved Subscriber is dealing with vulnerable customers.
- Detailed information must be provided in relation to the properties available, any deposit and service charges or management charges payable.
- Contracts and tenancy agreements must be clear and fair, and must be available in large print, Braille and audio formats (if requested). They must set out the rights and responsibilities of both parties in relation to specified items, including any restrictions on the age of people allowed to be resident in the community.
- Where the properties are new-build, Approved Subscribers are obliged to give customers a realistic expected completion date, and provide as much notice as possible of any delays.
- The Code contains obligations in relation to managing the Approved Subscriber's relationship with consumers, and handling and resolving complaints. Approved Subscribers are also obliged to nominate a Code Compliance Officer and carry out an internal audit at least once a year.
What measures will Approved Subscribers need to put in place?
The Code places various obligations on Approved Subscribers, many of which will already be in place as a matter of good practice. However, Approved Subscribers must ensure that they comply with these requirements as, under the Code, they are obliged to audit their compliance with the Code at least once a year and take action to rectify any failings. Audit reports must be available to ARCO assessors.
ARCO commissions independent and experienced assessors to visit schemes. If any non-compliance issues are identified and are not resolved within a specified timeframe, the operator risks losing its Approved Subscriber status.
The following are examples of procedures or measures that an Approved Subscriber may need to put in place:
- Training for employees and monitoring of employees' performance of their duties under the Code;
- A procedure for ensuring that the needs of vulnerable customers are met during the sales process;
- A procedure for ensuring that a Key Facts document, summarising the key charges to consumers, is provided before any deposit is paid to reserve a property;
- A process for consulting and responding to any recognised residents' association; and
- A procedure for handing and resolving written complaints.
The future of the Code
Whilst there is currently no obligation on organisations who provide retirement communities to be members of ARCO and thus adhere to the Code, they would be wise to consider voluntarily following it. Owing to our ageing population, retirement communities are going to be a boom area in the coming years. Funding may be offered more readily (or on more advantageous terms) to those who are Approved Subscribers.
Contributor: Alexandra Holsgrove Jones
This publication is intended for general guidance and represents our understanding of the relevant law and practice as at January 2016. Specific advice should be sought for specific cases. For more information see our terms & conditions on www.TLTsolicitors.com