What is Illegal Working?
This article by our UK Immigration Solicitors examines why UK employers need to understand what illegal working is and the impact of breaching illegal working legislation.
Contact OTS Solicitors for expert legal advice.
What is illegal working?
Under UK law, it is illegal for an employer to employ a member of staff who:
- Does not have the right to work in the UK, or
- Would be in breach of their visa conditions if the employer employed them to do the work
The definition of illegal working is broad. It is not limited to being against the law to employ those defined in the UK immigration rules as illegal immigrants.
Examples of employing a person illegally
Some employers believe illegal employment does not apply to them because they consider their actions harmless. That can be a very costly mistake.
Examples of employing a person illegally include:
- Employing a person full-time on a Student Visa rather than restricting their hours of work to the work hour conditions on their Student Visa.
- Continuing to employ an employee who has not extended their Work Visa and who therefore no longer has the right to work in the UK.
- Asking a sponsored employee on a Skilled Worker Visa to carry out work that is not within their job description or to do a different role or one that does not meet the skill or salary threshold.
An apparently harmless example is offering non-skilled overtime work over a busy period to a sponsored worker desperate for some extra cash. It may seem like a win-win situation, as the employer does not need to use expensive agency staff, and the employee receives the pay boost they need. However, the employer risks a hefty fine and the loss of their sponsor licence, while the Skilled Worker Visa holder risks their visa and jeopardises their future and their family's life in the UK.
The law on illegal working and employers
The Immigration, Asylum and Nationality Act 2006 imposes a legal duty on employers to prevent illegal working in the UK by ensuring that employees have the right to work.
Criminal penalties for employers who employ illegal workers
The criminal penalties for employers who employ illegal workers in the UK include:
- Imprisonment for up to five years.
- Payment of an unlimited fine.
An employer can be convicted of employing an illegal worker if they knew or had reasonable cause to believe that a worker did not have the right to work in the UK.
Examples of reasonable cause to believe a worker did not have the right to work in the UK include:
- A worker’s passport or other identification appears obviously false.
- The employee’s paperwork appears genuine, but the photos bear no resemblance to the employee.
The criminal offence of illegal working for employees and workers
Under Section 34 of the Immigration Act 2016, it is an offence to work without permission if a person knows or has a reasonable cause to believe that they do not have permission to work.
Penalties for workers found to be working illegally include:
- Imprisonment of up to 51 weeks and/or
- A fine and/or
- Seizure of earnings under the Proceeds of Crime Act.
Civil fines for employers who employ illegal workers
The Home Office can impose a civil penalty on an employer who hires a person without the right to work in the UK. Although this is in addition to any criminal charges for employing an illegal worker, employers typically face only civil penalties.
Section 15(2) of the Immigration, Asylum and Nationality Act 2006 says that the Home Office may issue a penalty notice requiring the employer to pay a fine. Under Section 15(3) of the Act, the employer is excused from paying a fine for employing an illegal worker if they can demonstrate compliance with all prescribed requirements.
Section 15(3) of the Act is known as the statutory excuse. ‘All prescribed requirements’ means the employer must have followed the up-to-date version of the government-mandated right-to-work checks and must not have known that the employee didn’t have the right to work in the UK.
When the statutory excuse or legal defence does not work
If a business employs an illegal worker, the statutory excuse of having carried out a right to work check will not provide a defence to the imposition of a fine if:
- The employer did not conduct the check properly using the latest Code of practice on preventing illegal working: Right to Work Scheme for employers.
- The check was carried out, but the employer should have reasonably known that the paperwork provided by the employee was false.
- The employer conducted the check, but should have reasonably known that the documents provided by the employee belonged to someone else because the photo ID was not checked against the employee.
- The right-to-work check was not repeated in a situation where an employee has time-limited leave to remain.
- An employee temporarily in the UK on a Business Visitor Visa was allowed to undertake work beyond the scope of permitted Visitor Visa business activities. Permitted work activities under the immigration rules include attending meetings or interviews, attending trade fairs, and promotional work, but not selling.
An employer is liable if they have appropriate procedures in place, but the staff did not complete the check or did so incorrectly by failing to follow the most recent Home Office Guidance.
Civil law fines for employers who employ illegal workers
The civil law penalties for employers who employ illegal workers are in two fine groups:
- First breach - £45,000.
- Repeat breach - £60,000.
The fines are per illegal worker. They are not based on company turnover, business sector, or the number of employees.
No action notice
Where the Home Office investigate a potential breach of the illegal working legislation and decides that:
- The business’s relationship to the illegal worker is not that of employer and employee, or
- The business has the legal defence of a statutory excuse because it complied with the right to work checks guidance.
The Home Office will issue a no-action notice.
Warning notice instead of a civil penalty for employing an illegal worker
If an employer is investigated for a first breach of illegal working legislation, the Home Office may issue a warning notice instead of a fine of up to £45,000.
A warning notice will only be considered if the employer:
- Had effective right-to-work checking practices in place (although they failed), and
- Actively co-operated with the Home Office during their investigation, and
- Reported the suspected illegal worker to the Home Office and received a unique reference number.
A warning notice will never be provided for a repeat breach of the illegal working legislation.
Ways to reduce a civil penalty for employing an illegal worker
It is possible to reduce a civil fine for employing an illegal worker by pleading mitigation.
Home Office guidance suggests that the mitigation or reduction amount should be:
- £5,000 if the employer self-reported the breach, and
- £5,000 if the employer cooperated with the investigation.
The only other way to reduce the civil penalty fine is to use the scheme’s faster payment option (FPO). The FPO means an employer pays the fine in full within 21 days to get a 30% reduction on the amount due. The FPO is available only for first breaches, not repeat breaches.
The associated consequences for employers of employing an illegal worker
In addition to potential criminal and civil proceedings, there are related consequences of illegal working for both employer and worker:
- Businesses with licences to sponsor overseas workers may receive a compliance visit by Home Office officials. An audit or investigation could result in the suspension or revocation of the firm’s sponsor licence. If the business does not have a sponsor licence, it may find it much harder to obtain one.
- The Home Office publicises the list of employers who received a civil penalty notice. This is intended to deter. However, publication can also cause reputational damage and loss of income because some companies do not want to be associated with a business that employs illegal workers.
- Individuals subject to immigration controls may have their visa curtailed, and they may be unsuccessful in applying for a new visa.
Help with civil penalty fines for employing illegal workers
OTS Solicitors are experts in business immigration law, including sponsor licence advice and guidance on conducting right-to-work checks. Our UK Immigration Solicitors can also help if you are facing a Home Office audit or are concerned about receiving a civil penalty notice.
Our immigration and employment law legal advice covers:
- Advice on right to work checks.
- Statutory excuse defences.
- Claiming mitigation when facing a first breach civil penalty notice.
- Advice on the definition of an employee.
- Assistance with understanding the definition of a first breach and the first breach time limits.
- Preparation for announced Home Office audits and compliance visits.
- Internal audits to ensure the right to work guidance and sponsor licence management rules are being followed.
- Specialist right to work and sponsor licence management training for HR staff and key personnel.
- Sponsor licence troubleshooting after imposition of a civil penalty.
- Immigration legal advice for visa holders where employers have received a civil penalty notice or had their licence suspended or revoked.
If your business:
- Has received and paid a civil penalty notice, or
- Is in a sector deemed high risk by the Home Office, or
- Has had issues with sponsor licence compliance.
It is at increased risk of additional Home Office scrutiny. Our Sponsorship Licence Lawyers can help you proactively reduce the risk of further penalties, licence suspension, or licence revocation.
Contact OTS Solicitors for expert legal advice.
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