The Immigration, Asylum and Nationality Act 2006 (“IAN 2006”) imposes tough sanctions on employers found to be employing persons who do not have the requisite permission to work. The three sanctions are: the imposition of a civil penalty; the charge of a criminal offence; and the imposition of a closure notice. This article looks at civil penalties only.
As a general practice, the Home Office pursues civil penalties in cases of alleged illegal working. Criminal prosecutions are reserved for employers who deliberately flout the rules. The framework of the IAN 2006 is thus used to compel employers to adhere to their legal obligations by imposing a financial sanction without criminalising those who make a mistake inadvertently.
Section 15(1) of IAN 2006 provides that an employer is liable to a civil penalty if it employs someone aged 16 or over, who is subject to immigration control and:has not been granted leave to enter or remain in the UK; or
(a) has leave which is invalid; has ceased to have effect (for example by reason of curtailment or revocation, or is subject to a condition preventing them from working).
(b) has leave which is invalid; has ceased to have effect (for example by reason of curtailment or revocation, or is subject to a condition preventing them from working).
Common categories of persons not subject to UK immigration control are British citizens, or those with Indefinite Leave to Remain or EU Settled Status. EU nationals living in the UK in accordance with the EU Treaties have until 30 June 2021 to apply for settled or pre-settled status (assuming they have not done so already), failing which they will no longer have the right to live and work in the UK.
An employer will be excused from paying a civil penalty where it can show that it undertook a compliant right to work check. This is often known as a statutory excuse.
A statutory excuse is made out if the employer shows that it met the requirements prescribed in the Immigration (Restrictions on Employment) Order 2007. The Order contains a list of immigration documents. If a prescribed document is obtained by the employer, then – subject to the employer taking certain steps to establish the validity of the document and keeping adequate records – it will have a valid statutory excuse. Similarly, if the employer uses the Home Office’s online “Employer Checking Service” and obtains a result to the effect the employee is permitted to work, then a statutory excuse is made out.
In the event that a statutory excuse is not made out, the maximum penalty is £20,000, though there are various mitigating factors which can result in the penalty being reduced to a minimum of £5,000, or even a warning notice with no penalty.
Right of Appeal
Where an employer has received a penalty notice, it may appeal to the County Court on the grounds that
(i) it is not liable (e.g. because the employee had the requisite immigration status);
(ii) it has a statutory excuse because of compliance with the specified requirements; or
(iii) the penalty is too high.
Demstone Chambers are Milton Keynes employment and immigration lawyers. We can help with all employment and immigration issues, including: drafting HR policies consistent with employers’ obligations to not discriminate unlawfully contrary to the Equality Act 2010, right to work checks and appeals against penalties for employing illegal workers. We can travel to all parts of England and Wales to help clients.