What is the Penalty for Employing Illegal Workers?

1. No valid proof of the act

The government must provide evidence that the employer knew or had “reasonable cause to believe” that the employee was an illegal worker. If an appeal reaches the County Court Register, Home Office officials must show that the organisation’s charge to employ illegal workers is valid under Section 15 of the Act.

The Home Office must establish that two issues exist:

• A worker with no legal right to work for any company in the UK; and
• Your company employed that worker.

The Home Office will need to show documentary evidence for both of these. If they fail to do so, the penalty will be quashed.

Your business might have a defence if you had documentary evidence that the worker was employed under an independent contract or was onboarded through a third-party agency.

In a 2008 appeal case against the criminal prosecution, it was determined that employees recruited through a third-party agency do not become one just because any person has worked for a company for a very long time. The country court stated that an employment contract could only be held if the business categorically insists on the third-party agency providing a specific person.

A company can file an objection form with this as a statutory excuse.

2. The Statutory Excuse of Due Diligence

Employers could avoid civil penalties if they carried out appropriate right-to-work checks on their employees under 15(3) section of the Act.

The Home Office has published guidance on how to carry out these checks in the Immigration Order 2007 (Restrictions on Employment). A business is relieved of the fine if:

• The employer has received a document from the following list from the employee:
  • EU or UK passport
  • residence permit
  • birth certificate
• The employer made sufficient effort to check the authenticity and ownership of the document(s).
• After the employment relationship had ended, the employer had kept a copy of all relevant materials for at least two years, and
• The employer verified the image and Date of Birth and found that the person’s appearance was consistent with the appearance.

If your company has complied with the abovementioned requirements, you have a good chance of waiving the civil penalty. Contact a legal advisor to discuss your case and the best way to proceed.

3. The Civil Penalty Regime Has Exceeded its Given Powers

The Home Office has wide-ranging powers under the Act. However, these are not unlimited, and the Home Office has been known to overstep the mark from time to time.

If the evidence supporting a civil penalty UK immigration notice appears to have been gathered unfairly or beyond solicitors’ regulation authority, you may be able to challenge the charge. This is a technical point, so you will need legal assistance to determine whether it applies in your case.

4. Statutory factors for mitigation

The Home Office must take into account certain mitigating factors when setting the amount of the penalty. If any of these apply, you may be able to reduce the size of the fine.

The statutory mitigating factors are:

• Whether the employer made a mistake in good faith when checking an employee’s right to work in the UK;
• Whether the employer has a history of committing similar offences in the past;
• Whether the employer was reported for suspected illegal workers;
• Whether you have already been penalized for employing the same worker;
• Whether the employer has extended cooperation during the investigation process.

A civil penalty for the charges of employing illegal workers can be challenged if at least one relevant factor isn’t considered. For example, if you have never been penalized before and the Home Office imposes a fine without taking this into account, you may be able to get the penalty reduced to a warning notice.

If you are unsure whether you have grounds to challenge a civil penalty, seek legal advice as soon as possible.

5. Other factors for mitigation

In addition to the statutory mitigating factors, the Home Office can also consider other relevant considerations.

For example, section 15 (2) of the Act allows the Home Office to decline to impose a penalty even though the evidence of the offence is prominent.

Section 19 of the Act implies that the Home Office officials should also consider other relevant elements that develop over time, such as the company’s compliance history and any management changes.

However, this construction may be criticized for placing a duty on the Government side to take all relevant circumstances into consideration and identify if it is justified to levy a penalty rather than relying only on the narrow criteria outlined in the Home Office’s recommendations.

This is a broad area, so if you think other factors should be considered, you should seek professional advice from experienced lawyers.