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Business advice: Home Office errors grounds for retailers to challenge illegal working fines

UK employers have a legal duty to carry out document checks on all employees, confirming their right to work in the UK.

If the Home Office alleges an employer has failed to perform these checks properly, they can issue a civil penalty for illegal employment to the business for up to £20,000 per illegal worker – with no cap on the number of fines that can be issued to any one employer.

Civil penalties have become a lucrative income stream for the Home Office. In the last quarter of 2017, over £11.5m in fines were issued to UK businesses for illegal working. During that period, 624 UK businesses were fined and 990 illegal workers were found.

The figures show that businesses are struggling to meet their immigration compliance duties, and that the Home Office is poised to target and fine those employers they consider to be in breach. Retailers in particular are a big focus for immigration enforcement due to the high numbers of foreign workers.

Larger retailers generally fall foul of issues with consistently implementing compliant processes across their operations, whereas small and independent businesses can be at risk if they’re not up to speed with their immigration duties, often through a lack of time, resource and understanding of the current rules. Smaller employers also tend to pay the fine without question, making them a more attractive target for immigration enforcement.

What government figures don’t reveal is how many of these fines are successfully challenged and subsequently cancelled, and that there is potential for more businesses to take on Home Office fines.

Retailers taking on the Home Office

Businesses can appeal a fine where they can show valid grounds for complaint against the Home Office’s allegations.  To monitor employers, the Home Office commonly uses site inspections (or ‘immigration raids’). These are often unannounced, with immigration enforcement officials attending a business’ premises to inspect personnel records and documentation and to interview staff.

If they find evidence the business does not have the necessary paperwork for its workers, and that employees are being unlawfully employed, they can issue a fine.  

Site inspections can be hugely stressful, unpleasant and invasive for employers. After the ordeal of the inspection, and concerned about the gravity of the allegations and the tight timeframes involved, it’s understandable that many business owners just pay the fine. But the civil penalty could be an unnecessary and avoidable cost because the Home Office may not have its own paperwork in order or have followed the correct procedure.  

The Home Office is cancelling fines where businesses can show that Home Office has failed to meet its own standards during an investigation and inspection. The irony is clear – how can businesses be fined for incorrect paperwork when the Home Office is have failing to do the same?

Common Home Office errors

If your business has received a civil penalty for illegal working, you will have a strict timeframe of 20 working days to respond to the Home Office.

Your options will be to either:

  • Pay the fine, ideally negotiating a discount
  • Challenge for the fine to be reduced
  • Challenge for the fine to be cancelled

You will need to act quickly to understand the nature of the allegations and to identify whether you have grounds to challenge the fine, either to have it reduced or cancelled altogether.

Each case will need to be looked at on its own facts and circumstances but some of the common areas of Home Office errors to look for include:  

  1. Unlawful entry

Did immigration enforcement officials have the relevant and lawful permission and paperwork to enter your premises to detain illegal immigrants?

For example, a warrant to enter premises under the Licensing Act should not be used to detain illegal immigrants.

  1. Officers’ conduct

Did the conduct of Home Office officials during the inspection fell below the required standards?

For example, were any non-English speaking individuals interviewed with a translator present?

  1. Misapplied rules

Has the Home Office has misapplied or misinterpreted the rules when making their decision to impose a fine?

For example, any unlawful arrests of foreign individuals during a raid could amount to racial discrimination.

  1. Insufficient evidence

Does the Home Office have insufficient evidence to support their allegations against your business?

For example, the Home Office will need to provide evidence that the individual was employed by your business. If you are not the employer of an alleged illegal worker, if they were agency staff or employed by a third party, you are not under a duty to verify their right to work and you will not be liable for a fine.

If you are able to show the Home Office has failed in their duties, you could have grounds to challenge the fine.

Avoiding Home Office fines

There are steps that businesses can take to help achieve compliance, and to improve prospects of a successful challenge in the event of any Home Office allegations.   

Ensure your right to work document checks remain compliant and in line with the latest Home Office guidelines. They are subject to frequent change, which creates a risk where businesses are not staying up to date for example about the types of documents that are acceptable and the length of time records must be kept and where the status of employees with time-limited right to work are not checked regularly.

If you can prove you carried out the required document checks of the employee’s documents prior to employing them and took reasonable steps to check the employee’s legality, you may be able to rely on the ‘statutory excuse’ to challenge the fine. You would need to have as evidence all relevant documents from the time you employed the individual.

If you can show mitigating circumstances, you may be able to negotiate a reduced fine.  For example, where you can demonstrate through your HR records general right to work compliance, and this issue was a result of a one-off oversight. If the basis of a fine is that the employee presented forged documents, you may be able to challenge the fine on the basis that you took all reasonable steps to meet your compliance duties.

If you are subject to a site inspection, it is helpful to take contemporaneous notes about the conduct of the officials, this can be valuable evidence, particularly in instances of unlawful or discriminatory behaviour.

Conclusion

While the Home Office continues to fail to follow its own rules, it pays for businesses to look at all of their options if facing a civil penalty for illegal employment. Taking advice at the preliminary penalty stage can help you determine quickly how best to proceed and which course of action will result in minimal financial loss for your business.

Anne Morris is managing director of business immigration solicitors, DavidsonMorris, specialists in all areas of UK immigration including challenging civil penalties for illegal working.

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