Confirming candidates have appropriate permission to work in the UK can be tricky, but the ramifications for checks that aren’t completed correctly can be quite significant. Here’s what penalties employers could face and who bears responsibility.
The civil penalty scheme for employing temporary workers illegally — without having a “statutory excuse” for having done so — is primarily financial. The penalty per illegal worker is £20,000, reducible by demonstrating extenuating factors such as proactively notifying the Home Office if illegal working is found, demonstrating your organization has effective right-to-work checking processes despite this particular breach, compliance with a Home Office investigation, or if it’s a first offence.
Meanwhile, organizations that hold a sponsor license to employ overseas staff can be placed into a form of “special measures” — or lose their license completely.
If you operate several sites and recruitment is devolved to each one, you’ll only be considered a repeat offender if Home Office investigators conclude that illegal working is due to a general failure in your centrally run recruitment practices. If you acquire a new business, and employees are transferred under TUPE, you have a 60-day grace period in which to ensure everyone is legally employed.
An employer may object to a civil penalty if they can prove they are not liable to it, they hold a statutory excuse for having employed the work in question, or if the amount is too high for the business to reasonably pay. Putting in a substantive notice of objection to a civil penalty, supported by evidence, can save a business many thousands of pounds. If the objection isn’t accepted by the Home Office, there is a right of appeal to the County Court.
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While such actions are rare (there was just one prosecution between July 2019 and September 2021), employers can face criminal sanctions if found to have employed a “disqualified person.” To prove guilt to the criminal standard of “beyond reasonable doubt” — as opposed to the civil standard of “is it more likely than not” – the government must show that the employer either knowingly or (since July 2016) had reasonable cause to believe that an individual was working illegally.
If the case is dealt with in the Crown Court in England and Wales, conviction can result in an unlimited fine, a confiscation order and up to five years in prison. If it stays in the Magistrates Court, employers could face a fine of £5,000 and up to 6 months’ imprisonment. Sanctions are similar in Scotland.
Any person who holds responsibility in a corporate body, partnership or as a sole trader – including a director, manager or company secretary – can find themselves in the dock as well.
Typically, an employer who has directly taken on a temporary worker under a contract — written, oral or implied — bears the responsibility to ensure no illegal working.
For employers using external contractors supplied by another organization, such as a staffing firm, there is no legal liability. However, Home Office guidance does describe it as best practice to confirm your contractors conduct compliant right to work checks. The buck in this instance therefore stops with the agency or organization supplying the labor.
An external Identification Document Service Provider (IDSP) making use of Identification Document Validation Technology (IDVT) can help businesses verify British and Irish citizens’ rights. In that case, the IDSP’s positive check provides an employer with a statutory excuse under the civil penalty scheme, so a limited element of responsibility-sharing exists.
But a business working with a self-employed individual under a contract for services could be held liable if it fails to check work permission as part of the onboarding process. “Employment” is broadly defined in Immigration Rules to include:
“[P]aid and unpaid employment, paid and unpaid work placements undertaken as part of a course or period of study, self-employment and engaging in business or any professional activity.”
Civil or criminal liability aside, certainly a business could suffer reputational damage if found to be employing self-employed contractors, so it’s best to avoid that possibility.
This is a complex area, where there is much to be gained — and avoided — by planning in advance and putting robust procedures in place. So often we see immigration checks as an afterthought for businesses — an approach that can prove costly.
Faced with a civil penalty, we advise employers seek legal counsel, whether in relation to mitigation or even a full challenge to the validity of the penalty notice.
For a detailed look at the various ways employers can conduct Home Office-compliant checks, refer to this article on the Latitude Law website.