The penalties for employing illegal workers are harsher than ever, so make sure all your documentation is up to date, says Vikki Wiberg
Over Christmas your restaurant received a £60,000 Home Office civil penalty for employing three seasonal workers without the correct evidence of their right to work legally in the UK. While checking their files, and those of other seasonal workers, you have identified other missing documents. This is your second civil penalty in 2016. What should you do?
With effect from July 2016, section 35 of the Immigration Act 2016 introduced a lower threshold for criminal liability for employers who employ illegal immigrants. Employers are now committing an offence if they know or should have known that an employee did not have the right to work in the UK. Breaching section 35 can lead to up to five years' imprisonment (rather than the previous two years). This sits alongside the civil penalty regime under section 15 of the Immigration, Asylum and Nationality Act 2006, under which companies can be fined up to £20,000 per illegal worker.
Carrying out compliant right to work checks and retaining correct documentary evidence of those checks provides a defence against a civil penalty. From 1 December 2016 the Home Office also gained a power under section 38 of the Immigration Act 2016 to close premises for up to 48 hours (or longer in certain cases), where illegal working has been found in the previous three years and where further illegal working is suspected.
The Immigration Act 2016 builds on an environment under which companies and their brands are increasingly held accountable for breach of compliance obligations, including under the immigration rules. While this affects all sectors, the hospitality sector, with its seasonality of workers, multiple sites to manage and relatively high turnover of employees, is particularly vulnerable to illegal working. This risk is likely to increase if access to European national employees changes in a post-Brexit world.
In an era where social media can spread news of Home Office raids at speed, the impact of a Home Office raid on a company's carefully developed brand and reputation should not be underestimated. This can be seen, for example, from the fallout of the Byron Burger raid in summer 2016.
We are not aware of any cases where the new ‘closure' provisions have been relied on by the Home Office. However, it is important to remember they can only be used where there is a history of illegal working, including payment of civil penalties. In light of the financial impact of a 48-hour closure on a busy site along with, again, the negative publicity this is likely to bring, we recommend you carefully consider whether or not to object to a civil penalty before it is paid.
While around £12m of civil penalties were levied in Q2 2016 (the most recent data), it is estimated that a substantial number could have been successfully challenged by their recipients. This would save money and also lessen the likelihood of site closures.
- Ensure you have good right to work record-keeping processes in place as well as a robust monitoring system for visa expiries to minimise risk.
- Review and, if relevant, update your right to work training and processes to ensure those managers responsible understand what needs to be done.
- Consider appointing an immigration champion with overall responsibility for right to work checks. This is particularly helpful in a devolved organisation with multiple sites.
- Think about how to position yourself through a press statement and staff messaging in the event of an audit.
Being found to be in breach of the immigration rules can have criminal and civil liability. It can also use up extensive management time in managing the fallout as well as impacting on brand and customer loyalty. It is important to keep on top of right to work duties.
Vikki Wiberg is senior counsel in the Employment, Pensions and Mobility Team at law firm Taylor Wessing LLP