Changes from February 2008
Illegal working is a subject which is never far from the top of the political agenda or from newspaper headlines. Now the Government wants to ensure that it is at the forefront of employers' minds too.
Under a new regime which was introduced by the Immigration, Asylum and Nationality Act 2006 and came into force on 29 February 2008, employers who employ illegal workers could face a fine of up to £10,000 for each illegal worker they employ and also criminal prosecution. To accompany this new regime, the Border and Immigration Agency (BIA) has produced new guidance on pre-employment and ongoing checks on employees.
The new regime is part of a broader overhaul of the immigration system which includes the introduction of a five-tier, points-based system which is being implemented in stages as of March 2008.
Checks and fines
All employers should already make basic checks to confirm the identity of every person they intend to employ. Section 8 of the Asylum and Immigration Act 1996 made it a criminal offence for an employer to employ an illegal worker. While it did not introduce a legal requirement to carry out checks on new employees, it became best practice to do so. If an employer inadvertently employed an illegal worker, the fact that he had carried out the relevant checks may have given him a statutory defence against criminal liability.
The Immigration, Asylum and Nationality Act 2006 (the relevant provisions of which came into force on 29 February 2008) repeals section 8 of the 1996 Act and introduced a new regime. Under the new rules, if an employer employs an illegal worker, he could be:
- liable to pay a civil penalty of up to £10,000 per illegal worker; and
- prosecuted for the offence of knowingly employing an illegal worker and, on conviction, face an unlimited fine and/or a prison sentence of up to two years.
For these purposes, an illegal worker could be a person who does not have current and valid permission to be in the UK and/or a person who does not have valid permission to do the type of work the employer is offering.
If the employer does not know that the worker is an illegal worker, there is scope for establishing a "statutory excuse" against liability for payment of the civil penalty, provided that certain original documents are checked and copied before the employee starts work and follow-up checks are carried out (usually on an annual basis) if required (see below). As with the previous regime, there is no legal requirement to carry out the checks but employers will not be able to benefit from the "statutory excuse" if they fail to do so.
The specific details of the checks are set out in the Immigration (Restrictions on Employment) Order 2006 and the BIA's Guidance for Employers. While there is some similarity to the arrangements under the previous legislation, employers will need to refer to the detailed list of documents provided in the BIA's Guidance as the structure and contents of these lists differs from those that applied previously. There are three lists which are structured as follows:
- List A: Documents which establish a statutory excuse for the duration of the employee's employment with the employer i.e. are indicative of permanent leave and to be and work in the UK.
- List B: Documents which establish a statutory excuse for a limited period i.e. which are indicative of the employee only having limited leave to be and work in the UK.
- Documents which do not provider employers with a statutory excuse.
The structure of the lists reflects the fact that, in some cases - i.e. where the documents an employee provides fall within List B - the employer will need to make follow-up checks on an ongoing (usually annual) basis in order to continue to benefit from the statutory excuse.
Practical pointers
So what should employers do to ensure that they comply with the new regime? A number of practical pointers are set out below.
- Document lists
Employers should familiarise themselves with the document lists in the BIA's Guidance in order to ensure that they ask for and inspect all the relevant documents prior to a new employee commencing employment.
- Checking
Employers should ensure that anyone who is responsible for checking and copying the documents presented by prospective employees understands the steps they need to take in order to verify and take the necessary copies of the documents presented to them. An employer must ensure that these steps are taken in order to be able to take advantage of the "statutory excuse". The BIA Guidance outlines the process an employer should go through when checking the documents.
Employers may also need to update any standard application forms, offer letters or separate questionnaires currently in use to take into account the changes.
Employers are expected to carry out a number of checks but are only expected to spot falsified documents if the falsification is "reasonably apparent". An Employer Checking Service is also available to assist employers.
- Records and ongoing checks
Employers should review record-keeping arrangements. Employers should keep copies of the documents provided by a prospective employee for the duration of that employee's employment and for a further two years after their employment has ceased. This appears to be an exception to the general principle outlined in the Information Commissioner's Office's Employment Practices Code (which is intended to help employers adopt practices compliant with the Data Protection Act 1998) that information obtained from a recruitment vetting exercise should be destroyed "as soon as possible, or in any case, within 6 months" but that a record of the result of vetting or verification can be retained. Employers should nevertheless take steps to ensure that their system for storing copies of documents is secure and complies with the requirements of the Data Protection Act 1998. The Employment Practices Code provides further guidance on this issue.
Where follow-up checks are required, employers should follow the same process that is followed for new employees and keep a record of the date on which the follow-up check was carried out.
- Existing employees
Provided that the previous regime was complied with in relation to employees engaged since 27 January 1997, there is no need to carry out further checks on existing employees. The new requirements only apply to employees who started work on or after 29 February 2008. Employers will not need to carry out any ongoing follow-up checks in relation to employees whose employment with them commenced before this date. However, employers who employed illegal workers between 27 January 1997 and 28 February 2008 could still be liable for criminal prosecution under the old legislation if they did not verify and retain copies of the documents necessary to establish the old defence prior to taking those employees on. Therefore, employers should ensure that their records are in order with respect to any employees they engaged during this period.
- TUPE transfers
Employers should note that where they acquire employees as a result of a transfer of a business under the Transfer of Undertaking (Protection of Employment) Regulations 2006, they should undertake the same checks as are required on recruitment of new employees although they will have a 28 day grace period following the date of the transfer in which to do so.
- Contracts
Employers should consider reviewing certain provisions in their employment contracts and policies. In particular, employment contracts should include a warranty from the employee to the effect that he/she is entitled to work in the UK and that he/she will notify the employer if at any point this ceases to be the case. If this clause is included, the employee will be in breach of his employment contract if he is not in fact entitled to work in the UK or if he fails to tell the employer that his entitlement to work in the UK has expired.
In addition, if contracts or other documents such as a disciplinary policy or staff handbook list the circumstances in which an employee's contract of employment may be terminated summarily, the list should include wording to the effect that an employee may be dismissed summarily if they are found to be working illegally.
- Avoiding Discrimination
The BIA has published a Anti-Discrimination Code of Practice to give employers guidance on avoiding discrimination whilst also complying with the requirements relating to illegal workers. According to the Code of Practice, employers should ensure that when making such checks, they do so in a non-discriminatory manner, for example, they apply them to all applicants and at the same point of the recruitment process. Furthermore, they should ensure that potential recruits who produce documents from List B (i.e. who have only temporary leave to work in the UK) are not treated less favourably during the recruitment process or during their employment.
Further guidance on this issue can be found on the BIA's website at http://www.bia.homeoffice.gov.uk/employers/preventingillegalworking/.
An edited version of this article was first published in Croner Employment Law Briefing, Issue number 137, 20 March 2008.
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