Checking immigration status: an overview

Andrew Osborne, Partner, Sports Group and Head of Business Immigration at Hammonds, begins a series of articles on checking immigration status, with an overview.

Introduction

This year will see the biggest shake-up of the immigration system in its history. As part of the shake-up, the Government has strengthened the rules on employing foreign nationals. The changes to the rules will inevitably result in an increased administrative burden for employers, coupled with a higher risk of prosecution and of incurring penalties.

On 29 February 2008, the provisions in ss.15-25 of the Immigration, Asylum and Nationality Act 2006, which set out employers' responsibilities in relation to the prevention of illegal working in the UK, came into effect. These provisions replaced s.8 of the Asylum and Immigration Act 1996, under which employers' previous responsibilities were set out.

Under the 2006 Act, an employer that employs individuals who are subject to immigration control and not entitled to undertake the work in question because they do not have the correct immigration status (for example because they do not have the appropriate work permit to work for the particular employer) will be liable to pay a civil penalty of up to £10,000 per illegal worker. Penalties are assessed on a case-by-case basis and will be calculated with reference to a sliding scale, principally determined by the extent to which the employer has attempted to comply with the requirements and the number of times that it has previously been found to be employing migrants illegally. Section 15 of the 2006 Act provides that employers are able to establish an excuse (equivalent to the statutory defence previously available under the 1996 Act) against liability for payment of a civil penalty. Employers can establish the excuse only by checking and copying specified original documents before a migrant is employed.

Employers must check documents in relation to all recruits, regardless of their apparent immigration status or racial or ethnic background. Failure to do so could result in the illegal employment of an individual, or potential race discrimination in recruitment.

If an employer knowingly employs a person who is not permitted to work, it will not be entitled to rely on the statutory excuse and may also be prosecuted under the 2006 Act for the offence of knowingly employing an illegal worker. Conviction under this offence carries a potential unlimited fine and/or a prison sentence of up to two years.

Legislative background

The new measures have been implemented by way of the 2006 Act and various pieces of secondary legislation, including the Immigration (Restrictions on Employment) Order 2007, which lists the documents that can be used by an employer to establish the statutory excuse. The Border & Immigration Agency, which is an executive agency of the Home Office, will oversee the implementation and enforcement of the new measures. The Border & Immigration Agency has published Summary guidance for employers - prevention of illegal working - Immigration, Asylum and Nationality Act 2006 (PDF format, 217K), Comprehensive guidance for employers on preventing illegal working (PDF format 1.56M), and two codes of practice, Prevention of illegal working - civil penalties for employers (PDF format, 154K) and Prevention of illegal working - guidance for employers on the avoidance of unlawful discrimination in employment practice while seeking to prevent illegal working (PDF format, 183K) (all on the Border & Immigration Agency website).

Establishing the excuse

Employers can establish the statutory excuse, and thereby avoid liability, by checking and copying one or a specified combination of two original documents prior to employment commencing. There are two lists of acceptable documents: list A and list B. List A includes UK or European Economic Area (EEA) passports and other documents that prove a person's entitlement to live and work in the UK indefinitely. List B includes passports and other documents showing limited leave to remain and work in the UK. Documents provided from list A will establish an excuse for the duration of the migrant worker's employment. If list B documents are provided, then the document checks must be repeated in relation to the employee concerned at least once every 12 months until he or she provides documents from list A or leaves employment. Comprehensive lists of the documents that are in list A and those that are in list B are available in the Quick Reference section of XpertHR.

By carrying out the repeat checks that are now required if a document is provided from list B, an employer will be able to retain the original excuse. However, the excuse cannot be established after employment has started. Employers that can demonstrate that they have complied with the requirements set out in the summary guidance and have established an excuse will not have to pay the civil penalty even if it transpires that an employee was, in fact, working illegally.

The new arrangements for establishing an excuse will apply only to those employees who start work with an employer on or after 29 February 2008. Employers that employed illegal migrants, or legal migrants working illegally, between 27 January 1997 and 28 February 2008 will still be liable to prosecution under the 1996 Act if they did not establish the statutory defence at the point of recruitment. If an employee was recruited before 29 February and the employer was entitled to rely on the statutory defence under the original Act, the defence will be retained for the duration of that person's employment.

TUPE transfers

Employers that acquire staff as the result of a business transfer under the Transfer of Undertakings (Protection of Employment) Regulations 2006 have a grace period of 28 days to undertake the appropriate document checks, following the date of transfer.

If, having carried out the checks, an employer establishes that a prospective or current employee is not permitted to work, it is entitled to refuse to employ, or continue to employ, that individual. It is then up to the prospective or current employee to show that he or she is permitted to do the work being offered. Employers should, however, follow the statutory dismissal procedures in relation to any dismissal on grounds of immigration status so that the employee can suggest previously unconsidered ways of obtaining permission to work, and thereby avoid dismissal.

There is clearly a risk to the transferee that there will be a loss of key employees post-transfer and/or civil penalties or criminal prosecution if it fails to carry out the checks within the 28-day period. Even if the transferor carries out the checks prior to the transfer, the transferee will need to carry out the checks itself post-transfer to retain the excuse. It cannot rely on any warranties from the transferor that the relevant checks have been carried out already.

Code of practice on unlawful discrimination

The code of practice Prevention of illegal working - guidance for employers on the avoidance of unlawful discrimination in employment practice while seeking to prevent illegal working (PDF format, 183K) (on the Border & Immigration Agency website) is a statutory code, which means that it has been approved by the Secretary of State and laid before Parliament. Its aim is to provide employers with guidance on avoiding a civil penalty for employing workers illegally but without acting in a way that could be discriminatory on racial grounds. The code does not impose any legal obligations on employers but it can be used as evidence in legal proceedings. Courts and employment tribunals must take account of any part of the code that might be relevant to matters of racial discrimination in employment practices.

The code applies to all employers in the UK and also to certain organisations such as agencies that supply temporary staff to end-users, recruitment agencies (including online agencies) and public authorities. It provides background information on the nature of discrimination under the Race Relations Act 1976, including direct and indirect discrimination, harassment and employers' liability for race discrimination claims.

Next week's article, which will be published on 17 March, will look at the procedural steps that employers need to follow when checking immigration status and the civil and criminal penalties that they may face for non-compliance.

Andrew Osborne is Partner, Sports Group and Head of Business Immigration at Hammonds (Andrew.Osborne@hammonds.com)

Further information on Hammonds Solicitors can be accessed at www.hammonds.com