Compensation policy

Introduction

We know that when things go wrong, it can be upsetting and frustrating. This policy explains how we decide when compensation is appropriate, what type of compensation we may offer, and how we calculate it.

Our aim is to be fair, open and consistent. We follow the Housing Ombudsman’s guidance on compensation and use it alongside our Customer complaints policy.

Compensation is one way we can put things right, but it isn’t the only one. Our first priority is always to fix the problem and learn from what went wrong.

We’ll always explain:

Whether compensation applies.
How we calculated it.
Why we made the decision.

This policy aligns with:

The Housing Ombudsman Complaint Handling Code.
The Housing Ombudsman’s guidance on remedies and compensation.
Magna’s Customer Complaints Policy.

Who this policy applies to and what it covers

This policy applies to:

All Magna customers, former customers and leaseholders. Members of the public aren’t eligible for compensation under this policy.
All colleagues at Magna.

This policy covers:

When we’ll consider paying compensation.
The different types of compensation we may offer.
What we will and won’t pay compensation for.
How compensation decisions link to our complaints process.

Our approach to compensation

Our priority is to:

Fix the problem.
Put things right.
Award compensation where appropriate.

We follow these principles when deciding compensation:

Be fair and reasonable – we look at what went wrong and how it affected the customer and household.
Be consistent – similar situations should lead to similar outcomes.
Put things right – compensation should reflect the impact caused and put customers back in the position they were in had we acted appropriately.
Be clear – we explain our decision and how we reached it.
Learn and improve – we learn from complaints and compensation to improve our services.

Compensation isn’t automatic. Each case is looked at on its own facts.

All compensation decisions are made by the Complaints Team, with approval from the Complaints Resolution Lead and/or Head of Customer Contact and Community Support, in line with financial regulations.

When we’ll consider compensation

We may consider compensation where:

We’ve made a mistake or failed to deliver a service.
We’ve unreasonably delayed delivering the service.
We’ve not followed our policies, procedures or legal duties.
Our failure caused inconvenience, distress, time and trouble, or financial loss.
Once an issue with our service was identified, we didn’t put things right within a reasonable time.

We‘ll usually consider compensation as part of a formal complaint, and we may also offer it outside the complaints process if appropriate.

We’ll pay compensation to a customer where an order for compensation is made by a court, the Regulator of Social Housing or the Housing Ombudsman Service.

Compensation will only be considered for any failings and associated impact within the 12 months of compensation being requested or a formal complaint investigated under our Customer Complaints Policy.

When we won’t usually pay compensation

We won’t usually pay compensation where:

The issue was outside our control, including but not limited to unforeseen leaks and component failures.
We acted reasonably and followed our policies.We fixed the problem the first time it was reported and within our service standards.
The issue relates to matters covered by another formal process, such as insurance or a court claim.
For incidents, damage or losses which have a value exceeding our insurance excess. These will be dealt with in line with our Risk Management Policy (insurance section) and associated procedures.
Compensation for the same issue has been agreed through a legal settlement.
Reimbursement of costs relating to temporary moves agreed by us in advance, as these are covered by our decant procedure.
Reimbursement of costs for temporary moves that weren’t agreed by us in
advance.
The issue happened over 12 months ago, or the customer should reasonably have been aware of the issue over 12 months ago.
Legal proceedings have been started. These are defined as details of the claim such as the Claim Form and Particulars of claim, having been filed at court. Legal proceedings exclude the pre-action protocol or mediation stage.

This list isn’t exhaustive. We’ll always look at the individual circumstances.

Types of compensation we may offer

We use the Housing Ombudsman’s remedies guidance to help us decide the right outcome. Compensation may include one or more of the following:

Apology and practical action

In many cases, a meaningful apology and prompt action to fix the problem is the most important remedy. This may include:

Completing or correcting work.
Improving communication.
Changing how we deliver a service.

Financial compensation

Financial compensation may be offered where an apology and action alone aren’t enough. This can include:

Time and trouble – where customers have had to spend significant time chasing us or raising concerns.
Distress and inconvenience – where our actions or delays have caused more than minor upset or disruption, resulting in a meaningful impact on the customer or household.
Loss of service or amenity – where customers couldn’t fully use their home or a service.
Out-of-pocket expenses – where customers paid for something because of our failure.

How we decide the amount of compensation

When deciding the amount of compensation to give, we consider:

What went wrong and how serious it was.
How long the problem lasted.
The impact on the customer and their household.
Whether we acted promptly once we were aware.

Whether we made the situation worse through poor communication or delay. We use compensation ranges rather than fixed amounts. This allows us to be flexible and fair.

How we handle specific situations

Compensation for failure to repair

Customers may be entitled to compensation from us where repairs haven’t been completed within target times and are qualifying health, safety, or security repairs in accordance with the “right to repair” set out in the tenancy agreement.

In the first instance, we’d encourage customers to use the complaints process for repairs and condition claims as it may result in faster action. We may refer customers to our internal complaints process when addressing any claim and/or the level of compensation.

Loss of service or amenity

Where there’s a loss or breakdown of service provided by us, which a customer pays a service charge for, we’ll refund the service charge for duration of the loss/breakdown if it was within our control and not dealt with during our target response times. We may also pay the customer for any additional costs they incur such as extra energy bills.

Compensation won’t be paid for loss of service or amenity if a suitable alternative is available. Compensation payments will be calculated for the duration of the loss/breakdown after our target response time.

We may pay compensation if a customer loses the use of part of their home, which is caused by factors within our control. This compensation will not apply where the loss is caused by:

Planned improvement works, which are covered by disturbance allowances; or
The need for response repairs which are completed during the target response time.

Compensation for loss of the use of part of the home is calculated using the amount of rent charged for that time.

Damage to personal belongings or internal decorations

In certain circumstances, we may make a payment for household items that have been damaged or lost because of something we’ve done or failed to do, subject to reasonable evidence being provided. Evidence may include, but isn’t limited to, original purchase receipts or proof of the amount paid, evidence of damage and the item being beyond reasonable repair (eg photos or a report from an independent expert) and quotes for like-for-like replacement.

Where there’s damage to decorations because of something we, or anyone working on our behalf, have done or failed to do, we may fix the damage ourselves or pay the cost of fixing the damage. This is subject to being able to calculate how much it would cost us to complete the remedial works through our own repairs service.
High-value claims may be considered through our insurance process. Claims will only be considered for like-for-like replacement items.

Damage caused during grounds maintenance or other external works

If damage is alleged to have been caused during grounds maintenance or other external works, such as chipped or cracked car windows or bodywork, customers should contact their insurance provider first for advice and to arrange remedial works. Following an insurance claim, we may make compensation payments to cover the insurance excess payments when there’s evidence that we caused or likely caused the damage.

Missed appointments

We may consider compensation where a customer was required to attend a pre‑arranged appointment, either at their home or elsewhere, and the appointment was missed due to our service failure. This may include situations where:

The appointment was missed without notice.
Our colleagues or contractors attended but didn’t follow agreed reasonable adjustments, meaning the appointment couldn’t take place.
We arrived unreasonably late, usually two hours or more, and the customer couldn’t accommodate a later time.

We won’t usually offer compensation where we were unable to attend an appointment for good reason, such as colleague sickness or parts not being available, and we gave reasonable notice to the customer, usually at least 24 hours in advance.

We won’t offer compensation where an appointment was missed or couldn’t go ahead because of the customer’s actions. This includes where:

The customer didn’t receive or respond to reasonable notifications.
Access to the home wasn’t provided.

Loss of heating and hot water

We recognise that loss of heating and hot water can have a serious impact on a household. We may consider compensation where:

A customer has experienced a loss of heating and/or hot water in their home.
The loss resulted from our service failure.
We were made aware of the loss or should reasonably have been aware of it.
We didn’t restore the service within relevant statutory, policy, or reasonable timescales.

Where compensation is appropriate, it will normally be calculated from the end of the relevant or reasonable timescale, not from the date the issue first arose.

If there was a partial loss of heating and/or hot water, compensation may be based on a proportion of the usual amount, reflecting the level of impact on the household.

We won’t usually offer specific compensation for loss of heating where we’ve provided a reasonable alternative, such as temporary heaters, and this adequately reduced the impact on the household. However, we’ll still consider whether any other remedy is appropriate based on individual circumstances.

Loss of power

We may consider compensation for loss of power where:

A customer has experienced a loss of power in their home.
The loss was caused by our service failure.
We were made aware of the loss or should reasonably have been aware of it.
We failed to restore the power supply within relevant statutory, policy, or reasonable timescales.

Compensation will normally be calculated from the end of the relevant or reasonable timescale.

Where there is a partial loss of power, compensation may be based on a proportion of the usual amount, reflecting the level of disruption experienced.

If a loss of power also affected heating and/or hot water, we may consider compensation for both the loss of power and the loss of heating and/or hot water, where appropriate.

We may also consider additional compensation for reasonable out‑of‑pocket costs caused by a loss of power. This may include:

Spoiled food or other perishables.
Loss of cooking facilities and reasonable costs of purchasing alternative meals.

These costs will be considered separately from standard compensation awards and must be supported by evidence where possible.

We won’t usually offer specific compensation where the loss of power was due to planned works, reasonable notice was given, and the works were completed on time. Where there is additional impact caused by service failure in these circumstances, we may consider other remedies.

Garages

If a claim is made for a garage being unusable due to outstanding repairs, we may pay up to a 50% rent refund for a maximum of 12 months or for the length of delay in completing repairs, whichever is lower. Only one claim will be payable in a 24-month period and customers will be notified of their option to cancel the license for their garage if any further repairs are delayed.

Dehumidifiers and temporary heaters

When we provide a dehumidifier to help with drying out a home, or provide temporary heaters in response to a loss of heating, customers can claim £3 per day per appliance for the duration of their approved use.

Reimbursement for work completed by a third party

If customers need to arrange for work to be completed by a third party and want full or partial reimbursement from us due to our action, or lack of action, we’ll ask customers to provide us with at least two quotes from suitably qualified professionals before we respond to their claim. These quotes should list the proposed works and the details of any materials to be used.

If the quote is for a replacement, it should be for like-for-like replacement only.

When assessing the quotes received, we'll consider whether they represent value for money and may ask for further quotes if they don't.

Where we agree to partial reimbursement, this will be based on the lowest quote available and is subject to the invoice matching the agreed quote for the type of work to be carried out and materials used.

Any reimbursement is only payable after the work has been completed, and an invoice has been submitted to us.

How we pay compensation

Compensation will usually be made in writing and sent with an acceptance form for customers to complete and return to us. Compensation will be paid if the acceptance form is returned within three months of being sent.

Payments are processed in line with our financial regulations and are normally made by bank transfer to the customer’s chosen bank account or credited to a customer’s rent account.

We may offset compensation against arrears, unless the payment is to reimburse specific costs.

Disagreeing with our decision

If a customer is unhappy with our compensation decision, they can:

Ask us to review it as part of the complaints process.
Escalate their complaint in line with our Customer Complaints Policy.
Contact the Housing Ombudsman once our complaints process is complete.

Learning from compensation

We record and review compensation to:

Identify service failures and trends.
Improve our policies and services.
Ensure consistency and fairness.

Learning from complaints and compensation is shared with managers and senior leaders.

Responsibilities

All compensation decisions are to be made by the Complaints Team, with approval from the Complaints Resolution Lead and/or Head of Customer Contact and Community Support, in line with financial regulations.

The Director of Customer Operations is accountable for all aspects of compensation and is responsible for the development and review of this policy, making sure that it meets all relevant legal and regulatory requirements and guidance. The policy will be reviewed and approved by the Strategic Board annually alongside our customer complaints policy.

The Head of Customer Contact and Community Support is responsible for ensuring that this policy is adhered to, reviewed and updated in accordance with the policy review timetable.

The Complaints Resolution Lead is responsible for the delivery of operating procedures relating to customer complaints, for maintaining accurate data and reporting on complaints in line with governance arrangements.