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27 February 2008

Watch Out! New penalties for illegally employing migrant workers

Watch Out! New penalties for illegally employing migrant workers
With new penalties to tackle illegal working coming into force in February, employers need to ensure that they are fully up to speed on checking employees’ right to work in the UK.  Be warned, the penalties are increasing significantly and will not be avoided easily.

The Current Position
At the moment, if an employer employs migrant workers, they must check a prospective employee’s entitlement to work before they employ them and must keep a record of the documents that are checked.  If an illegal worker is employed, this is a criminal offence and the penalty, on conviction, is a fine of up to £5,000 per illegal worker.  There is a “statutory defence” available if the employer can show that they carried out initial checks before recruiting a prospective employee.  This involves checking and copying certain specified documents.

In practice however the penalty is not often enforced and the Government is looking to tighten up the rules and place greater obligations on employers to check the immigration status of their workers.

The position with effect from 29 February 2008
The new law will differ considerably from the current position and will affect the prevention of illegal working in relation to staff employed from 29 February 2008.  In particular, the new measures include:

a civil penalty for employers who employ illegal migrant workers – the maximum penalty will be £10,000 per illegal worker, which is twice as much as the current fine;
a criminal offence for employers who knowingly employ illegal migrant workers – this offence carries a maximum penalty of two years’ imprisonment and/or an unlimited fine; and
making employers responsible for carrying out continued checks on migrant workers with a time-limited immigration status (i.e. limited leave to remain in the UK) to ensure that each worker has an ongoing entitlement to work in the UK.
As with the current position, employers will be expected to carry out initial document checks before recruiting a prospective employee to check their right to work in the UK.  This should be done by all employers - not just those who are involved in sectors that have traditionally used migrant labour.  Employers must also ensure that they:

take all reasonable steps to check the validity of the documents;
check that any photographic documents relate to the prospective employee;
check that any date of birth in a document is consistent with that of a prospective employee;
retain a copy of a whole document which is not a passport or other travel document;
retain a copy of specified pages of a passport or other travel document; and
retain copies of the documents for at least 2 years after the employment ceases.
The Civil Penalty
As outlined above, the civil penalty for employing a migrant worker illegally is set to increase to a maximum of £10,000 for each illegal worker.  The Government’s Border and Immigration Agency (the “BIA”) will apply a sliding scale to the level of fine on a case by case basis.  Various factors will be taken into account, including:

whether the employer has been issued with any previous warnings or penalties from the BIA for employing an illegal worker;
whether the employer has carried out full, partial or no checks on documents in relation to the employee’s right to work in the UK;
whether the employer has reported suspected illegal workers to the BIA; and
the employer’s co-operation with the BIA during any investigation into any employee’s right to work in the UK.
If an employer carries out a full document check against a potential employee prior to employing them, it will be afforded the protection of a “statutory excuse”.  In order to conduct a full check against a prospective employee, certain documents specified by the BIA must be checked and copied.  These must then be stored securely.  If an employer is able to provide the specified documents on request to the BIA demonstrating that they carried out necessary checks they will not be subject to a civil penalty, even if it transpired that they are employing illegal migrant workers.

Employees who have restrictions on their leave to remain in the UK will need to have their documents checked by their employer at least once every 12 months after the initial checks to confirm their ongoing entitlement to work in the UK.  An employer will only continue to be entitled to rely on the statutory excuse and consequently be excused from liability where it carries out the necessary follow-up checks.  Therefore, when employing a worker with limited leave to remain in the UK a further check on their documents should be diarised within 12 months of recruiting them.

An employer will not be able to claim the protection of the statutory excuse where it knowingly employed an illegal migrant worker.  In fact, where such a worker is employed, the employer may also be subject to prosecution for a criminal offence. 

The pre-employment checks are straightforward and can be built into normal recruitment procedures.  The lists of documents that should be requested from any potential employee have been announced by the BIA and official guidance has also been published to help employers comply with their new legal obligations.

Discrimination
Employers need to be alive to the fact that requesting certain documents from migrant workers before employing them may potentially be discriminatory on racial grounds.  The BIA has issued a Code of Practice which will also come into force on 29 February 2008 to assist employers in avoiding unlawful discrimination in recruitment practice.  The Code recommends that employers:

obtain the necessary documents on all potential employees, which will protect against liability for a civil penalty but will also demonstrate a consistent, transparent and non-discriminatory approach to recruitment; and
build the document search into recruitment practices and apply it to all applicants at the same point in the recruitment process.
Complying with the above should help defend any complaints of discrimination from prospective migrant workers and is consistent with good recruitment practice.
Further Proposed Changes
Certain other changes to immigration law are expected in the next year, including:

ID Cards for foreign nationals – if foreign nationals who are subject to immigration control plan to reside in the UK for 6 months or more, they will need to apply for an ID card which will contain biometric data, such as a digital photograph and a scan of the individual’s fingerprints.
Points-Based System – there will be a new system of employing foreign nationals which will replace the current Highly Skilled Migrant Programme and the current system for the provision of work permits.  In the majority of cases, employers will need to become sponsors to employ foreign nationals.  The new system is due to be phased in during 2008 and 2009.

What can you do?

Ask every prospective employee for proof that they are entitled to reside and work in the UK.
Include the necessary pre-employment checks for migrant workers into your normal recruitment procedures to ensure that you are protected by the statutory excuse.
Do not, under any circumstances, employ anyone who you know to be residing in the UK illegally or that you know does not have the right to work in the UK.
Ensure that you have clear written procedures for the recruitment and selection of staff, based on equal and fair treatment for all applicants at each stage of the recruitment process.
Refer to the BIA guidance for employers which lists the documents that can and can not provide a statutory excuse. Click here to view the guidance.

Shoosmiths can assist with all your business immigration questions.  If have any queries in relation to the employment of migrant workers, please contact the author of this article, Jennifer Argent,  Thames Valley Office on 08700 868925.
jennifer.argent@shoosmiths.co.uk

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Jennifer Argent

Solicitor
T: 08700 86 8925
I: +44 (0)118 965 8925
E: jennifer.argent@shoosmiths.co.uk