Prevention of Employing Illegal Workers

Employing Foreign Workers in the UK

Before hiring someone in the UK, companies must understand the relevant laws and regulations. Typically, employers need a sponsor licence to employ foreign workers unless the individual already has the right to work in the UK, such as under a UK graduate visa.

Regardless of the chosen route, the employer and prospective employee must be well-prepared. Non-compliance with these rules can lead to severe consequences for both the employer and the worker.

Legal Consequences of Employing Illegal Workers

Employing illegal workers poses significant legal risks and repercussions. The consequences are severe, ranging from hefty fines to potential imprisonment. Over the years, penalties have increased to ensure appropriate punishment for violations and to deter businesses from engaging in illegal employment practices, thereby helping to curb illegal immigration.

Illegal labour exploits workers, undermines opportunities for UK citizens and legal migrants, and drives down wages. To combat this, the Home Office regularly reviews and updates the rules and penalties, making it crucial for employers to stay informed. Engaging with legal experts, such as QC Immigration, is highly recommended to ensure compliance and avoid severe penalties.

Definition of Illegal Workers

Illegal workers are individuals subject to immigration control who either lack legal permission to enter or remain in the UK or violate conditions restricting their ability to work. Examples include:

• A person entering the UK on a tourist visa and taking up employment while in the country.
• An individual who entered the UK on a visa overstayed and then worked without legal permission to remain.
• A student who exceeds the legally permitted number of working hours associated with their visa status.

Civil Penalties for Employers

The Home Office operates a civil penalty scheme that outlines the consequences for employers found guilty of employing illegal workers. These penalties can reach up to £60,000 per illegal worker and are subject to change. For instance, in 2024, the civil penalty for employing an illegal worker was increased from £20,000 to £60,000 per worker.

The Home Office publishes a quarterly report listing employers fined for hiring illegal workers. This list highlights how significant and disruptive these fines can be for businesses.

Criminal Penalties for Knowingly Employing Illegal Workers

If an employer is found guilty of knowingly employing illegal workers, they can face up to 5 years in prison and an unlimited fine. This applies if the employer knew or had ‘reasonable cause to believe’ that the worker did not have the right to work in the UK.

Knowingly employing illegal workers includes situations where the Home Office has reason to believe that the employee:

• Did not have permission to enter or remain in the UK.
• Had permission to stay that had expired.
• Was not permitted to do certain types of work.
• Their papers were incorrect or false.

Compliance and Avoidance Strategies

To avoid breaking the law, companies must first fully understand the requirements for hiring workers legally and ethically. They must also implement robust compliance and governance processes, including thorough right-to-work checks, before hiring new employees. Employers should also ensure compliance with these procedures by showing that they have consistently taken measures to hire only individuals with the legal right to work in the UK.

Right-to-Work Checks

A Right to Work check is a mandatory process that UK employer must conduct to verify that all employees have the legal right to work in the United Kingdom. This requirement applies to all employers, regardless of the size or nature of their business, and is essential to ensure compliance with UK immigration laws.

Why Right-to-Work Checks Matter

Conducting Right to Work checks is not just a legal obligation; it also serves as a critical measure to ensure that your business operates within the bounds of the law. Employers must demonstrate that they have taken consistent and compliant measures to hire only individuals with the legal right to work in the UK. Failure to conduct these checks properly can lead to severe legal and financial consequences, including significant fines and potential imprisonment.

When and How to Conduct Right-to-Work Checks

As part of your recruitment and onboarding process, Right to Work checks must be carried out indiscriminately on all prospective employees, regardless of their nationality, race, or ethnicity. It is crucial to apply these checks uniformly to avoid accusations of unlawful discrimination.

There are two primary methods to conduct Right to Work checks:

1. Manual Checks: This traditional method involves physically examining the original documentation provided by the employee, such as a passport or visa, to verify their right to work. The employer must ensure the documents are genuine, unaltered, and belong to the person presenting them.
2. Digital Checks: For a more streamlined process, employers can use electronic verification systems provided by the Home Office. These systems allow for the digital verification of an individual's right to work, offering a quicker and often more reliable method of conducting these checks.

Document Requirements

The type of documentation required for a Right to Work check can vary depending on the individual's immigration status. Employers must familiarize themselves with the specific documents that must be checked and retained for each employee. This may include passports, biometric residence permits, or other immigration-related documents. Maintaining copies of these documents is essential as proof that the checks have been conducted properly.

Reducing the Risk of Penalties

The best way to avoid penalties is to ensure full compliance with the rules and maintain that compliance consistently. If an employer fails to follow the regulations for preventing illegal working—whether by not conducting a Right to Work check or doing so incorrectly—they will not have a "statutory excuse". They could be liable for a penalty of up to £60,000 per illegal worker.

A "statutory excuse" is established when an employer correctly conducts a Right to Work check according to the latest Home Office guidance. This means employers can protect themselves from civil liability and the associated penalties by following the proper procedures.

Responding to Civil Penalty Notices

When an employer receives a Civil Penalty notice for hiring illegal workers, there are three options: accept the penalty, object to it, or request a payment plan. In any event, you have only 28 days to respond to the Home Office.

Home Office Monitoring and Site Visits

The Home Office actively monitors businesses and conducts site visits where there is a perceived risk of illegal employment. These visits are often unannounced and may be prompted by research or anonymous tips indicating that illegal workers are employed on the premises.

Option 1: Accept the Penalty

If you choose to accept the Civil Penalty, you will need to arrange payment with the Home Office. In some cases, a discount may be offered for prompt payment, though penalties are generally substantial, and any discount may be minimal.

Option 2: Object to the Penalty

If you believe the penalty is unjust, you have the right to object. This objection can be to either reduce the penalty amount or have it removed altogether. However, objecting carries a risk: the Home Office could increase the penalty, mainly if they believe you are no longer cooperating. For example, suppose your penalty was reduced due to mitigating factors, such as cooperation with the Home Office. In that case, an objection might lead them to reconsider and potentially increase the penalty again.

Option 3: Request a Payment Plan

If paying the penalty in a lump sum is not feasible, you can request a payment plan. This option allows you to spread the cost over time, making it more manageable for your business.

Reputational and Operational Risks

Receiving a Civil Penalty can have significant repercussions beyond the financial impact. There is a severe risk of reputational damage, as the government publishes a quarterly report listing employers who have been fined. This report includes the name, address, and penalty amount for each business. Additionally, if your business holds a sponsor licence, a penalty could lead to the licence being downgraded or revoked, further affecting your ability to hire foreign workers legally.

Appealing Against Civil Penalties

You can appeal a civil penalty for employing illegal workers, but only after you have objected to the penalty and received a response from the Home Office. If you believe there are grounds for an appeal, you must file it within 28 days of receiving the outcome of your objection.

Preventive Measures for Employers

Employers must take Preventive measures to avoid the severe penalties associated with employing illegal workers. The Home Office has established a Code of Practice on preventing illegal working, which outlines various measures and processes employers should use to ensure compliance and the legal employment of eligible foreign workers.

Get Support With Sponsor Licence Compliance

The penalties for employing illegal workers are severe, leading to civil and criminal sanctions. Understanding your legal responsibilities as an employer and taking preventive measures is essential to avoiding reputational, operational, and financial risks. QC Immigration helps companies ensure proper checks are conducted before employment and with follow-up checks when needed.

We support all aspects of obtaining a sponsor licence, ensuring legal employment and ongoing compliance. Our services include advising on systems, processes, record-keeping, right-to-work checks, follow-up checks, training programs, and compliance audits, all in line with Home Office guidance and UK immigration laws. We also ensure timely sponsor licence applications.