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Civil Penalty For Employing Illegal Workers To Increase - Next Steps?

When, Why and How Much?

On 7 August 2023, UK Visas & Immigration announced that the penalty for employing illegal workers was set to increase. UK Visas & Immigration have now confirmed in their latest Code of Practice on Preventing Illegal Working that the fee increase is set to come into force from 22 January 2024.

The penalties are set to increase from £15,000 per worker for a first breach to £45,000 per worker. Repeat breaches are due to increase from £20,000 per worker to £60,000 per worker. This is the first increase of civil penalties since 2014.

In their August article, the Home Office justified the increase to deter employers from engaging in illegal practices and to discourage irregular migration.

When issuing a penalty, UK Visas & Immigration has announced they will also consider mitigating factors to reduce the penalty issued. These include:

  • Has the employer reported suspected illegal workers to the Home Office? If a report has been made to the Home Office and a Unique Reference Number confirming the same has been received, the penalty for each illegal worker will be decreased by £5000. The suspected illegal worker(s) must be reported to the UK Visas & Immigration’s helpline. UK Visas & Immigration will consider this factor for first and repeat breaches.

  • Has the employer actively co-operated with the Home Office? Active co-operation with the Home Office during their investigation will result also in a reduction of £5000 per illegal worker. The Home Office note active co-operation includes providing access to premises/records; responding honestly and promptly during enforcement visits; being available during an investigation if required and full and prompt disclosure of evidence. UK Visas & Immigration will consider this for first and repeat breaches.

  • Does the employer have effective Right to Work checks in place? Employers that show they have effective recruitment practices and have evidenced their reporting of the illegal worker(s) and actively co-operate with the Home Office will have their penalty reduced to the minimum level of a warning notice. This only applies where the employer has not been shown to employ illegal workers within the past three years. The Home Office notes that general compliance with preventing illegal worker employment will evidence effective checking practices, as well as having robust document checking systems; thorough and consistent right-to-work checking processes; records of staff right-to-work checks; and a history of compliance with sponsor requirements.

    • It should also be noted that UK Visas & Immigration can make errors in their decision to issue a civil penalty notice and it is therefore important that you seek legal advice to see if there are grounds to challenge their decision.

     What Should Employers Do?

    As UK Visas and Immigration have announced these changes, we would like to take the opportunity to remind sponsors of the importance of having the correct right-to-work checks in place. All sponsors have a duty to check all employees’ right to work in the UK.

    UKVI prescribe the following ways a sponsor can comply with their duty to ensure their employees have the right to work. One of the checks below must be made prior to the start date of the employee’s employment:

  • Manual check - This involves the employer reviewing an original version of the employee’s right-to-work document. The document needs to be checked in the presence of the employee and a clear, dated, copy of the document should be retained on file. Employers should ensure the document is genuine, belongs to the employee, photograph and date of birth is consistent with other information provided. Manual checks normally apply to British and Irish passport holders, although can apply to other status holders in some instances.

  • Identity service provider checks (IDSP) - An employer can use an independent IDSP to complete a digital identity check for any British and Irish worker, holding a valid British or Irish passport. UK Visas and Immigration publish a list of approved IDSP providers and advises that the provider use has a minimum level of ‘medium’ confidence according to their framework.

    • Providers do not need to be on this approved list, although employers using other providers should be satisfied the provider will offer the correct level of verification. The employer should then be satisfied the results of the check are consistent with the documents provided and retain the results of the check on file for the duration of employment and 2 years thereafter. 

  • Online Home Office check - For non-British or Irish workers, employers can use the Home Office’s right-to-work checking service. The service provides confirmation of the employee’s work rights in the UK and the duration of their leave via a digital result which is made using the Home Office’s online systems. The employee will first need to request a share code using the system and then provide this to their employer. The employer will then enter this on the service to verify that the employee has the right to work.

    • It is important to do this alongside reviewing an employee’s Biometric Residence Permit (BRP) to ensure their leave is still valid and no updates exist on their status. UK Visas and Immigration intend to phase out BRPs by the end of 2024, so it is important employers are familiar with the service. Employers should satisfy themselves that the details provided match other information provided and retain a clear copy of the check on file for the duration of the employee’s employment.

    What If I Am Still Awaiting A Decision From The Home Office?

    For employees or job applicants who are currently awaiting a decision on a submitted visa application or appeal of a Home Office decision, an employer must check the status via the Employer Checking Service (ECS). A positive verification notice using the ECS will provide a valid proof of right-to-work for 6 months. If the employee has still not received the result of their visa application prior to these 6 months expiring, the ECS will need to be repeated. The check should be retained on file and the applicant’s new status assessed as soon as it is available.

    Successfully completing any of the above checks will mean the employer will have a ‘statutory excuse’ that demonstrates that they have conducted a right-to-work check. Having a valid statutory excuse will mean that the employer avoids liability for payment of a civil penalty.

    Employers sponsoring workers should continue to follow their sponsorship duties, including their reporting and record-keeping duties on any employee in the UK. The increase in penalties set by UKVI highlights the importance of having the correct processes in place.

    How Can Paragon Law Help?

    Paragon Law is happy to assist you with specific questions about ensuring correct right-to-work checks are completed and we can carry out audits on your HR processes and systems to ensure that your business is complying with UKVI requirements. Please get in touch if you require our assistance.

    Paragon Law also regularly hosts webinars on right-to-work checks. If you would like to attend one of these webinar sessions, please email your Paragon Law contact or complete this contact form.

    Author: Andy Poole When, Why and How Much?

    On 7 August 2023, UK Visas & Immigration announced that the penalty for employing illegal workers was set to increase. UK Visas & Immigration have now confirmed in their latest Code of Practice on Preventing Illegal Working that the fee increase is set to come into force from 22 January 2024.

    The penalties are set to increase from £15,000 per worker for a first breach to £45,000 per worker. Repeat breaches are due to increase from £20,000 per worker to £60,000 per worker. This is the first increase of civil penalties since 2014.

    In their August article, the Home Office justified the increase to deter employers from engaging in illegal practices and to discourage irregular migration.

    When issuing a penalty, UK Visas & Immigration has announced they will also consider mitigating factors to reduce the penalty issued. These include:

  • Has the employer reported suspected illegal workers to the Home Office? If a report has been made to the Home Office and a Unique Reference Number confirming the same has been received, the penalty for each illegal worker will be decreased by £5000. The suspected illegal worker(s) must be reported to the UK Visas & Immigration’s helpline. UK Visas & Immigration will consider this factor for first and repeat breaches.

  • Has the employer actively co-operated with the Home Office? Active co-operation with the Home Office during their investigation will result also in a reduction of £5000 per illegal worker. The Home Office note active co-operation includes providing access to premises/records; responding honestly and promptly during enforcement visits; being available during an investigation if required and full and prompt disclosure of evidence. UK Visas & Immigration will consider this for first and repeat breaches.

  • Does the employer have effective Right to Work checks in place? Employers that show they have effective recruitment practices and have evidenced their reporting of the illegal worker(s) and actively co-operate with the Home Office will have their penalty reduced to the minimum level of a warning notice. This only applies where the employer has not been shown to employ illegal workers within the past three years. The Home Office notes that general compliance with preventing illegal worker employment will evidence effective checking practices, as well as having robust document checking systems; thorough and consistent right-to-work checking processes; records of staff right-to-work checks; and a history of compliance with sponsor requirements.

    • It should also be noted that UK Visas & Immigration can make errors in their decision to issue a civil penalty notice and it is therefore important that you seek legal advice to see if there are grounds to challenge their decision.

     What Should Employers Do?

    As UK Visas and Immigration have announced these changes, we would like to take the opportunity to remind sponsors of the importance of having the correct right-to-work checks in place. All sponsors have a duty to check all employees’ right to work in the UK.

    UKVI prescribe the following ways a sponsor can comply with their duty to ensure their employees have the right to work. One of the checks below must be made prior to the start date of the employee’s employment:

  • Manual check - This involves the employer reviewing an original version of the employee’s right-to-work document. The document needs to be checked in the presence of the employee and a clear, dated, copy of the document should be retained on file. Employers should ensure the document is genuine, belongs to the employee, photograph and date of birth is consistent with other information provided. Manual checks normally apply to British and Irish passport holders, although can apply to other status holders in some instances.

  • Identity service provider checks (IDSP) - An employer can use an independent IDSP to complete a digital identity check for any British and Irish worker, holding a valid British or Irish passport. UK Visas and Immigration publish a list of approved IDSP providers and advises that the provider use has a minimum level of ‘medium’ confidence according to their framework.

    • Providers do not need to be on this approved list, although employers using other providers should be satisfied the provider will offer the correct level of verification. The employer should then be satisfied the results of the check are consistent with the documents provided and retain the results of the check on file for the duration of employment and 2 years thereafter. 

  • Online Home Office check - For non-British or Irish workers, employers can use the Home Office’s right-to-work checking service. The service provides confirmation of the employee’s work rights in the UK and the duration of their leave via a digital result which is made using the Home Office’s online systems. The employee will first need to request a share code using the system and then provide this to their employer. The employer will then enter this on the service to verify that the employee has the right to work.

    • It is important to do this alongside reviewing an employee’s Biometric Residence Permit (BRP) to ensure their leave is still valid and no updates exist on their status. UK Visas and Immigration intend to phase out BRPs by the end of 2024, so it is important employers are familiar with the service. Employers should satisfy themselves that the details provided match other information provided and retain a clear copy of the check on file for the duration of the employee’s employment.

    What If I Am Still Awaiting A Decision From The Home Office?

    For employees or job applicants who are currently awaiting a decision on a submitted visa application or appeal of a Home Office decision, an employer must check the status via the Employer Checking Service (ECS). A positive verification notice using the ECS will provide a valid proof of right-to-work for 6 months. If the employee has still not received the result of their visa application prior to these 6 months expiring, the ECS will need to be repeated. The check should be retained on file and the applicant’s new status assessed as soon as it is available.

    Successfully completing any of the above checks will mean the employer will have a ‘statutory excuse’ that demonstrates that they have conducted a right-to-work check. Having a valid statutory excuse will mean that the employer avoids liability for payment of a civil penalty.

    Employers sponsoring workers should continue to follow their sponsorship duties, including their reporting and record-keeping duties on any employee in the UK. The increase in penalties set by UKVI highlights the importance of having the correct processes in place.

    How Can Paragon Law Help?

    Paragon Law is happy to assist you with specific questions about ensuring correct right-to-work checks are completed and we can carry out audits on your HR processes and systems to ensure that your business is complying with UKVI requirements. Please get in touch if you require our assistance.

    Paragon Law also regularly hosts webinars on right-to-work checks. If you would like to attend one of these webinar sessions, please email your Paragon Law contact or complete this contact form.

    Author: Andy Poole

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