The government recently announced that the financial penalty that can be applied to a business which employs illegal workers will be raised to up to £45,000 per illegal worker for a first breach and up to £60,000 for repeat breaches.

This is a substantial 3-fold increase and gives rise to significant financial and reputational risks for businesses who aren’t on top of compliance.

The Minister for Immigration, Robert Jenrick, has said that “there is no excuse for not conducting the appropriate checks and those in breach will now face significantly tougher penalties”. Yet the regime is often misunderstood.

With penalties set to triple, now is a good time to ensure your right to work checks are robust and free from the preconceived views and significant misunderstandings of the law that we frequently see. Common misconceptions include:

The right to work check is a legal requirement

It is not a legal requirement to check someone’s right to work before employing them. It is a precautionary and sensible measure because by completing the check correctly you then give rise to a statutory “excuse” from any penalty that might arise. Someone will either have the right to work for your business, or they will not. Carrying out the check doesn’t change that.

A fine can arise if someone does not have the right to work, and the employer has not checked their right to work, or the check is not done properly.

Worse consequences under criminal law can arise if the employer “knows” or “has reasonable cause to believe” the person does not have the right to work but employs them anyway.

The check can be done after employment commences

According to the official published guidance, if you do not complete the check before employment starts it does not give rise to a statutory excuse. That being said, it’s probably still worth carrying out the check.

Opinions differ on whether the check is effective from the date it is carried out, even if after employment starts. However, it’s surely better to carry out a belated check than not at all – even if it wouldn’t constitute an excuse, it will give a significant degree of reassurance.

It’s ok to just carry out the check on foreign nationals

No. In order to avoid discrimination, it’s important not to treat people differently based on their race or nationality. An effective right to work check regime will be applied equally to all new recruits.

We don’t need to worry about the check as we only engage contractors

It’s correct to say that the legal provisions, as regards civil penalties, only cover employment style relationships.  However, there are other areas of legal jeopardy which could apply if someone was engaged as an independent contractor under a contract for services.

In addition, an individual’s employment status is not always clear and this could give rise to a different employment status categorisation than you expect (or which is suggested by the contract) and thus increase the risk of penalties under the illegal workers regime.

We arranged the sponsorship of our skilled worker so we don’t need to worry about a right to work check

The benefit of a right to work check (if done properly) is that it provides an excuse for the duration of the visa. In some cases, if the individual’s visa permission is indefinite, then the excuse is indefinite. In other situations, when a visa is close to expiry, you may have to conduct an interim check whilst an application to extend the visa is undertaken.

As a sponsor, you might have been closely involved in arranging sponsorship and securing the visa of your employee so a right to work check may seem like a silly or unnecessary step.

However, it’s worth bearing in mind that someone’s visa can be cancelled without the employer becoming aware. Perhaps something happened that caused the Home Office to cancel your employee’s existing visa and your employee decides not to tell you. If you have carried out the right to work check properly then you can invoke the excuse, but if not, then you could be on the hook.

It’s important to ensure that your contracts of employment impose an obligation on an employee to inform you immediately if their right to work in the UK changes.

We bought a company and transferred all the workers under TUPE, we are pretty sure that the company had checked everyone’s right to work before we bought them

Under the TUPE regulations, right to work checks carried out by the transferor (the seller) are deemed to have been carried out by the transferee (the buyer). However, if the checks were not properly carried out in the first place, then you might be inheriting the problem!

It’s often sensible to carry out a fresh round of checks during the transaction and there are special provisions that cover TUPE transfers. This should be a key part of your due diligence, otherwise it could prove very costly.

I took a photocopy of the worker’s biometric card, and it’s stuck in a cabinet somewhere

After 6 April 2022, it was only possible to check certain kinds of statuses using the Home Office’s online checking system. Not carrying out the check properly, in line with the guidance, prevents you from relying on the excuse.

We carry out our checks remotely using video calls after Covid-19

Whilst it was possible to do this as a result of specially adjusted procedures during the pandemic, these are no longer in force. You can still meet the worker and check documents in their presence using a video call, but if carrying out a “manual check” you need to have the physical document in your hand.

I have engaged someone who has lived in the UK for 20 years, they have kids here and gave me an old passport with a stamp saying they could be here indefinitely – do I need to worry?

This a common scenario. Someone migrates to the UK many years ago, obtains indefinite permission and just relies on their stamp in a dog-eared old passport. However, the right to work check guidance stipulates that you cannot accept an old, expired document for the purposes of a proper check, and so in this case the individual should be advised to update their documents ASAP.

Our recruitment agent checks the right to work for us

Checks carried out by agents, or third parties do not qualify for the statutory excuse.

I’m pretty confident my employees aren’t going to break the law

The phrase “illegal work” can bring to mind consciously criminal acts. It is important to understand that illegal work can often arise inadvertently, as an otherwise law-abiding individual or organisation does not understand the law, and a breach arises by mistake. This can occur if a visa is accidently permitted to expire, or if a restricted permission to work is misunderstood, for example a frequent visitor to the UK who works for an organisation in ignorance of restrictions which apply to them.

Sadly, right to work checks are not as simple as they should be. They involve a tricky combination of various statutes and complicated formal guidance. It’s therefore really important to understand the law and apply it properly. An illegal worker penalty, or illegal work, can only arise when the person doesn’t have the legal right to work for your business. If they do have the right, even if the employer hasn’t carried out the check properly, then there is no breach of the law, and no penalty can arise.

It’s common that an employer has carried out some form of check, but not in the correct way. Whilst this might give a substantial degree of reassurance it is not quite the same as a statutory excuse. In such cases, an employer might need to take a risk-based approach.

Or what of a situation where a belated check picks up a problem – someone doesn’t have the right to work, but has worked? These cases are often very difficult to navigate.

In these circumstances, it’s critical to get advice at an early stage.

The best approach is always to review current procedures, ensure compliance with the guidance, and conduct a soft audit carefully and systematically. Once the right protocols are in place, and established as a core on-boarding function, the risk significantly decreases.

Our dedicated team has extensive experience of helping companies navigate difficult and technically complex areas of employment and immigration law. Get in touch if you’d like to discuss how we could help your business – we’d be delighted to speak to you.