When considering offering accommodation owned by yourself (or by a person with whom you have an arrangement) in your capacity as a farmer to your employee, you need to also consider whether or not you want your employee to have the option to keep that accommodation as a protected tenant after their employment comes to an end.
Following the commencement of Part I of the Housing Act 1988 on 15 January 1989, an agricultural worker is able to obtain an 'assured agricultural occupancy' which offers the worker a degree of security of tenure.
In order to qualify for such protection, your employee must have been employed in agriculture whole-time at 35 hours per week or as a permit worker for 91 weeks out of the previous 104 weeks. It does not matter whether the period of employment was with you on your farm or elsewhere. If the employee has not met this required period there are some circumstances under which they could still obtain an assured agricultural occupancy, but in the majority of circumstances they will be an assured tenant up until the point that they have satisfied the 91 week requirement.
The protection of assured agricultural occupancies not only covers farm managers and family workers but, subject to conditions, also covers retired workers, workers who have been forced by injury or ill health to give up employment, former farm workers, and the widow, widower or other family member who lived in the home with the worker at the time of their death (only one succession is normally possible). Whilst tenant farmers are not granted protection, it is important to remember that if a tenancy is terminated other protected persons could remain. Likewise, if the ownership of the freehold in the property changes the assured agricultural occupancy can continue even if the purchaser is not a farmer.
Unlike non-agricultural tied occupancy, if the qualifying agricultural worker loses their job or retires they can stay in the accommodation, albeit with the caveat that you can ask them to pay a market rent. If you want the property back in these circumstances you have to apply to the court to do so and prove that you have grounds under the law to evict the tenant. Grounds or no grounds, you may still be required to provide alternative accommodation to the tenant. Furthermore, you remain subject to the court's decision even if said worker is damaging the property, causing nuisance, not paying the rent or breaking the terms of the tenancy agreement.
It is, however, possible to prevent an assured agricultural occupancy arising. To do so you must serve written notice (in a prescribed form) at the start of the tenancy confirming that the tenancy is to instead be an assured shorthold tenancy. Under an assured shorthold tenancy you let the property to your employee whilst retaining the right to repossess the property at the end of the term. Usually this would be the preferable option from the Landlord/employer's perspective.