Employing illegal workers can be costly

Illegal immigration and illegal working are topics that are high on the agenda for many in government. With stories of immigrants attempting Channel crossings and data published by the government over illegal workers caught, employers do need to understand their obligations when taking on staff. The penalties are too stiff to ignore.

Checks required
Shabana Muneer, a director at Walker Morris, outlines that to work in the UK an individual must have the legal right to work, which now – post-Brexit – means “they must be a British or Irish citizen or have a UK immigration status which permits them to undertake employment.” She adds that “some immigration statuses will come with a conditional right to work – in certain roles, or for a certain number of hours per week.”

And for Mark Stevens, a senior associate at VWV, it’s important to recognise that every employer has a duty to prevent illegal working. In practice, he says that “this means that an employer must carry out checks to ensure that employees have the appropriate right to work in the UK; it is unlawful to employ someone who does not have the appropriate right or who is in breach of the terms of their visa.”

He explains that an employer found to be employing someone illegally without having carried out the prescribed checks could face criminal sanctions.

In checking an individual’s right to work, the law – or rather the Home Office – has set out the steps that employers must follow before employment starts. These checks can be done manually or online. Muneer says that the requirements are set out by the Home Office in its Employer’s guide to right to work checks guidance. She warns that “this changes frequently and the version of the guidance in force at the time the individual’s employment commences must be followed.”

In essence, to complete the checks manually, the employer must obtain original documents from the Home Office’s list of acceptable documents. It must then:

Check that the documents are genuine by checking that names, photographs and dates of birth are consistent across the documents.
Check the expiry dates for any time limited permission to be in the UK.
Check any work restrictions to find out if the prospective employee is able to do the work on offer and copy each document in a format which cannot manually be altered and retain the copy securely.

Alternatively, Stevens says that “an employer may be able to use the Home Office online right to work check if the individual has been issued an eVisa.” He adds, however, that this will not be possible for every applicant.

With the added complexity of employees with time limited permission to live and work in the UK, Stevens recommends that follow up checks are carried out through the course of the employment.

But regardless, he says “records of all checks should be stored securely in compliance with data protection obligations. Most importantly, if an employer knows or has a reasonable cause to believe someone is an illegal worker, they should not be employed.”

A good strategy in Muneer’s view is an up-to-date Right to Work policy which is applied to all new recruits. She says that “where robust practices have not been followed in the past, conducting an audit of historic compliance is vital so that any potential issues can be identified and appropriately dealt with.”

The need to avoid discrimination
Some question the need to check everyone rather than those individuals with different skin tones, accents, or non-British sounding names. The reason for checking all, however, should be obvious reckons Stevens, as “taking a limited approach to checking the right to work is very likely to be discriminatory and will not prevent unlawful working.” He thinks that “appropriate checks should be conducted for all prospective employees regardless of nationality or race.”

The worry for employers who only ask certain individuals for proof of their right to work is that, as Stevens notes, “employees who suffer discrimination during employment – or during the recruitment process, could bring claims seeking compensation as a result of the discriminatory treatment, which can include compensation for injury to feelings.”

And Muneer doesn’t disagree. She says that “checks should be carried out on all employees, regardless of presumed race or nationality and should be a part of the business’ standard on-boarding process.” She continues: “The Home Office is clear that adopting any other approach could give rise to claims against employers of discrimination on the grounds of race or nationality.” A good example in her mind would be a British national of ethnic descent who is asked to evidence right to work when their white British colleague has not could argue they have received different treatment on the grounds of their race.

Bluntly put, she says that “a targeted approach, based on an individual’s skin tone exposes employers to the risk of falling foul of illegal working legislation; if no right to work check is carried out, employers cannot guarantee that an individual who ‘looks’ like they are British or Irish actually holds the relevant status, and therefore cannot confirm whether or not they have the appropriate right to work in the UK without additional permissions.”

Stiff penalties for breaches
It goes without saying that while the majority comply with the law, for those that do not there are harsh penalties to make them rethink their actions. Indeed, as Muneer explains, it’s the Home Office that carries out compliance and enforcement checks and “in December 2022, the prime minister confirmed a five-step plan for tackling what are perceived to be the main issues around illegal migration.” She says that step two of this proposed plan is putting resources in place so that “immigration officers can refocus on enforcement action and increase raids on illegal working by 50%. This intent has been reflected in an increase in the number of illegal working raids at the beginning of this year.”

But as for the penalties themselves, Stevens details that a civil penalty is levied where an employer employs someone without the right to work. He says that where a breach occurs, “the Secretary of State – in practice, an immigration officer – will issue a notice of liability to pay a civil penalty of a specific amount, the maximum being £20,000 for each individual who does not have the right to work.”

Further, criminal penalties – a prison sentence and/or an unlimited fine – can also apply where the employer knows or has reasonable cause to believe that an individual is an illegal worker.

There is some help for employers though. Muneer says that “if right to work checks are carried out correctly, then even if that business does mistakenly hire an illegal worker, a statutory defence may be available against civil penalties.”

It should be added that immigration officers visiting an employer have the power to request an inspection of documents for each employee, question the individuals in question, as well as talk to other employees. “They also,” says Stevens, “have the power to search the premises for documents – electronically too – and seize them if they deem it necessary.” On top of this employers of illegal workers can also be named and shamed by immigration enforcement as a warning to others.

Beyond naming and shaming, Muneer warns that any sponsor licence that a company holds to sponsor migrant workers may be downgraded or revoked. This, she says, “can have serious logistical ramifications if the company is sponsoring workers – whether that is a large number of lower skilled workers or a small number of highly or specialist skilled workers; where a licence is revoked the visas of those workers will be curtailed and they will be required to leave the UK if they aren’t eligible for another immigration permission.”

And if a company doesn’t yet hold a sponsor licence, a civil penalty will impact on its ability to obtain one if the need arises. Muneer has seen that “in a highly competitive labour market where increasing numbers of businesses are turning to overseas labour to tackle skills shortages in the UK, any business which is prevented from going down this route could face a significant competitive disadvantage in the fight for talent.”

There is a twist to the story – the situation relating to contractors. Here Stevens emphasises that while the offence refers to individuals who are directly employed, “an immigration officer may not have the time or resources to identify if an ‘employee’ is actually a consultant, contractor or other individual working at the place of business. If these workers end up being removed, it could cause reputational damage to their business as well as disrupt the operations of their business.” It’s for this reason, that the Home Office recommends that the appropriate checks be carried out on all workers, whether employed directly or not. And for agency staff, Stevens recommends that the contract between the business and the agency should clearly state that the agency remains the employer and is responsible for conducting the necessary right to work checks.

It should be said at this point that the authorities are proactive in finding illegal workers. The latest data, Illegal working civil penalties – anonymous regional report: 1 July to 30 September 2022 – published in March (2023) noted that 240 penalties totalling £4.39m were handed out for the employment of 363 illegal workers. The Midlands was the worst area with 76 penalties handed out to the value of £1.225m for 102 workers. Scotland and Northern Ireland fared the best with just 10 penalties totalling £165,000 for 12 illegal workers. Remember, though, this data only relates to those found.

Common mistakes
The law may appear black and white but for some it appears fuzzy and grey. As a result, they make mistakes.

The first, according to Stevens is accepting UK driving licence as proof of the right to work in the UK. On this he says that “although it’s a form of identification, a driving licence is not sufficient evidence of the right to work in the UK.”

Similarly, Muneer frequently finds employers still accepting EEA or Swiss passports as evidence of right to work in the UK. The problem, as she sees it, is that “the end of freedom of movement following Brexit means that since 1 July 2021, EEA and Swiss citizens and their family members have been required to show evidence of their immigration status to new employers.”

She also highlights that a number of employers are still accepting physical biometric residence permit (BRPs) as evidence of right to work. But “since 6 April 2022, employers have been required to carry out online checks on individuals who have a BRP. Here no statutory excuse is possible.”

Next is the carrying out of a right to work check after an individual has commenced employment. For Stevens, this is a risky move as “the employer could potentially already be employing someone illegally.” The only solution is carry out checks before the individual commences employment.

Another mantrap is the acceptance of electronic copies of documents. Although this was permitted during the pandemic, Stevens says that generally it is necessary for documents to be checked in their original format unless a Home Office check is carried out. He states that “original documents must be checked carefully in the presence of the person they identify in order to ensure that it is the correct person shown in the picture.”

Allied to this is the failure to record the date that documents were checked. For Stevens, this is really important and he says that “copies of the original documents obtained should be annotated as ‘This right to work check was made on [DATE]’ and signed.”

Lastly, there’s the failure to carry out follow up checks. As noted earlier, this is a real issue for those employees whose right to work is time limited. Employers should carry out follow up checks before the time limit expires to comply with their legal duty.

The future
Some employers operate under the misapprehension that once they’re up to speed with current law that they need to do little else. However, Stevens makes the key point that immigration law does change and that “employers should regularly review the Home Office guidance on gov.uk.”

And as Muneer concludes, “the government has been vocal about increasing enforcement in the area of illegal working, and we can therefore expect to see the law being enforced more regularly and an increase in illegal working penalties.”

Employers have been warned.

 

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