Are you doing all you can to avoid a civil penalty?

Are you doing all you can to avoid a civil penalty?

Recent guidance from the Home Office shows civil penalties for illegal working totalling over £11 million were issued to businesses in just one quarter last year.  How do you get a civil penalty and how can they be avoided?

Recent Home Office data has revealed that there were 624 civil penalties for illegal working issued in the quarter from 1 October to 31 December 2017.  A total of 990 illegal workers were discovered by the Home Office and the gross figure for civil penalties in that quarter amounted to £11,600,000. Whilst this figure will likely be reduced once objections and/or appeals are processed it will still be a significant sum.

How do you get a civil penalty?

In a nutshell, if the business is found to be employing someone who does not have the right to work in the UK or who is working in breach of their immigration conditions, the Home Office can issue the employer with a civil penalty.  A civil penalty of £20,000 per illegal worker can be levied against the business and it is for the business to show why the penalty should be cancelled or reduced.

Other risks

The employer is also at risk of criminal sanctions if they knew or had reasonable cause to believe that the individual found to be working illegally did not have the right to work in the UK.  A custodial sentence of up to 5 years can be imposed.

Tier 2 sponsors also face additional risks.  The Home Office’s view is that holding a sponsor licence is a privilege and an employer risks losing that privilege, and therefore its licence, if it fails to comply with the sponsor licence regime.  In certain circumstances, if a sponsor is issued with a civil penalty the sponsor licence may be suspended, downgraded or even revoked.

There is also the risk of reputational damages as the Home Office publishes a publicly available list of all employers who have been issued with a civil penalty.

These risks can be avoided provided that the employer caries out right to work checks correctly before the employee’s employment commences.

How to avoid a civil penalty?

It is generally a very simple process to avoid a civil penalty.  A properly completed right to work check will give the employer a statutory excuse and, in such cases, no further action is usually taken by the Home Office and the case is closed.

Broadly, to undertake a right to work check correctly an employer must carry out the following prior to the individual starting work:

  1. Obtain the person’s original right to work documents as set out in the specified Home Office list of acceptable documents;
  2. Check the validity of the documents in the presence of the holder; and
  3. Make and retain a clear copy and make a record of the date of the check and ensure that the person carrying out the check signs the documents.

The copies must be retained by the business during the person’s employment and for two years after their employment ends. 

If the person has limited leave to remain a follow up check must be made at the time that their leave is due to expire.  Therefore, the expiry date of limited leave and the date of follow up checks should be diarised.

Further information on how to carry out the check and what documents are acceptable are available in Home Office guidance https://www.gov.uk/government/publications/acceptable-right-to-work-documents-an-employers-guide and https://www.gov.uk/government/publications/right-to-work-checks-employers-guide.  The Home Office also produce a useful checklist to enable the employer to get it right https://www.gov.uk/government/publications/right-to-work-checklist.  

The situation is also more complicated where the individual has an application pending with the Home Office and cannot provide documentation or in certain cases where the individual is a family member of a European national but cannot evidence this formally.  In these situations we recommend you seek advice. 

Comment

The problem is you only get one bite of the cherry.  The right to work check has to be completed before the individual starts work to obtain a statutory excuse and where the individual has time limited leave a follow up check is also required in most circumstances.

It is a common occurrence for us to see that an employer has undertaken a right to work check but it is incomplete or has been carried out too late. The employer may be satisfied that the individual has the right to work but if the passport is a good forgery, for example, or if the person later has an immigration extension application refused, the employer can still be subject to a civil penalty as they will not be able to demonstrate that they have a statutory excuse.  Importantly, civil penalties are also no longer reduced if a partial check has been undertaken.   

It is therefore a lot more important than it may first appear to ensure these checks are done correctly and at the correct time.  Home Office fines of up to £20,000 per illegal worker and the risk of losing its sponsor licence could be disastrous for a business.  

Contact our experts for further advice

View profile for Kate Fellows - TullyKate Fellows - Tully, View profile for Kerry GarciaKerry Garcia

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