Immigration compliance is an area of reputational risk employers ignore at their peril.
We are seeing increased Home Office scrutiny and enforcement action against organisations, with civil and criminal penalties for breaches of their immigration duties. It seems no organisation is too large or too reputable to avoid Home Office scrutiny.
All UK employers are required by law to meet the prevention of illegal working regulations, and while sponsor licence holders must also meet additional compliance duties.
Employers must meet their duties. Ignorance is no defence to a breach. Employers remain liable even if they were ‘unknowingly’ employing illegal workers.
If you are found to be employing workers illegally, in addition to the punitive Home Office measures, the likelihood is you may also have to deal with the negative impact on your organisation’s reputation.
Reputational damage
Your reputation is a highly valuable corporate asset. Any association with illegal working practices has the potential to cause significant and lasting damage to how your organisation is perceived in the market.
Consider the reactions of each of your stakeholder groups, for example:
- Buyers – your customers / clients may go elsewhere. Can you afford a hit in sales?
- Employees – any association with illegal employment will impact employee morale and your ability to retain and attract talent.
- Shareholders – share prices and brand equity take a hit through loss of confidence.
- Suppliers – suppliers may take this an opportunity to renegotiate trading terms due to a weakened market position.
- Regulators – the impact of a civil penalty can include downgrading or even withdrawal of your sponsor licence, and your ability to hire non-EEA workers. Could you operate without migrant personnel?
- Media – the media remains influential, and much is dependent on how you handle press enquiries and attention, and if or what is published. This may require expertise in crisis communications.
- General public – social media has made a publisher of everyone. How you respond will have a direct impact on how you are perceived.
- Local community – you may face increased cynisim or loss of support resulting in an impact on footfall and business.
- Competitors – expect your competition to take advantage of the opportunity to gain market share from you.
Managing the fall-out of reputational harm requires time, resources and expertise – all in addition to the handling of the penalty itself.
So – employers are well advised to sharpen their approach to immigration compliance, to prevent any accusation of illegal working arising in the first place. This means ensuring all areas of HR, global mobility and immigration operations, systems and processes are effective and compliant.
Safeguard your reputation
The commercial reality is, organisations have to find the balance between meeting their duties in a way that is operationally and financially viable.
Undertaking an immigration audit is highly effective in identifying areas of risk and recommendations to address potential or actual breaches, before the Home Office exercises its powers to investigate compliance. For example, one common area of compliance risk relates to List B employees, that is, those employees who and staying informed of the changing status of personnel with time-limited permission to work in the UK.
Minimsing the reputational damage of a civil penalty
If you receive a civil penalty notice for illegal employment, panic may well set in. The prospect of dealing with the Home Office can be hugely daunting, and the need to resolve the issue with minimal financial and reputational impact is critical. You may feel under pressure to settle quickly to make the matter ‘go away’. But this may not always be the best strategy for your organisation.
You need to decide which is the best course of action to take for your organisation. Given what is at stake, it is advisable to seek professional advice on the merit of your case.
If you are in breach, it will likely be a case of making the payment, seeking to negotiate more favourable terms, while limiting the potential for reputational damage.
There may however be grounds for you to object to the penalty notice and challenge the civil penalty, relying on the statutory excuse with a view to having the fine reduced or cancelled altogether.
Irrespective of the route you take, a civil penalty should result in steps being taken to rectify compliance issues and areas of risk within your organisation to avoid further civil and criminal penalties, and future breaches.
Need assistance?
DavidsonMorris’ team of business immigration lawyers have substantial experience in all aspects of immigration compliance and prevention of illegal working. Whether you are facing Home Office enforcement action, or are taking a proactive approach to avoiding compliance breaches, we can help.
For further information about our immigration audit service, or any query relating to HR compliance, please contact us.
FAQs
What is immigration compliance for UK employers?
Employers must ensure that all workers have the legal right to work in the UK. This includes conducting right to work checks, maintaining accurate records, and complying with sponsorship duties for visa holders.
How does immigration compliance affect reputational risk?
Failing to meet immigration requirements can result in fines, loss of a sponsor licence, and public exposure of non-compliance. This can damage an employer’s reputation, affect business relationships, and lead to difficulties in hiring skilled workers.
What are the penalties for non-compliance?
Employers who fail to conduct proper right to work checks can face fines of up to sixty thousand pounds per illegal worker. In serious cases, directors and business owners may also face criminal prosecution.
How can employers protect their sponsor licence?
A sponsor licence can be suspended or revoked if an employer fails to meet visa sponsorship obligations. To maintain compliance, employers should keep up-to-date records, report changes in employee status, and follow all Home Office requirements.
What happens if a business is found employing illegal workers?
If an employer is found to have illegal workers without proper right to work checks, they could be issued with a civil penalty, face a criminal investigation, and risk being added to the government’s list of non-compliant employers.
Can reputational damage from non-compliance be repaired?
Businesses can recover from compliance failures by taking swift corrective action, improving internal processes, and demonstrating a commitment to following immigration laws. Seeking expert advice and conducting internal audits can also help restore trust.
What steps should employers take to ensure compliance?
Regular internal audits, staff training, and clear policies on right to work checks can help employers stay compliant. Employers should also monitor changes in immigration law and update their procedures accordingly.
Glossary
| Term | Definition |
|---|---|
| Immigration Compliance | The process of ensuring that all employees have the legal right to work in the UK and that employers meet immigration rules. |
| Reputational Risk | The potential damage to a company’s reputation due to non-compliance with immigration laws, which can affect business operations and trust. |
| Right to Work Check | A process where employers verify that a worker is legally allowed to work in the UK using approved documents or the Home Office online service. |
| Civil Penalty | A financial fine imposed on employers who fail to carry out proper right to work checks, which can be up to sixty thousand pounds per illegal worker. |
| Sponsor Licence | A licence that allows UK employers to hire non-UK nationals under the Skilled Worker visa and other work visa categories. |
| Certificate of Sponsorship | An electronic document issued by a UK sponsor to confirm details of a job offer for a visa application. |
| Home Office Compliance Visit | An inspection carried out by the Home Office to assess whether a business is meeting its immigration and sponsorship duties. |
| Illegal Working | The employment of individuals who do not have valid immigration status or right to work in the UK. |
| Skilled Worker Visa | A visa route that allows non-UK nationals to work in eligible skilled roles for a licensed UK sponsor. |
| Public List of Non-Compliant Employers | A list published by the Home Office naming businesses that have been fined for employing illegal workers. |
| Statutory Excuse | A legal defence for employers who have carried out proper right to work checks but are later found to have unknowingly employed an illegal worker. |
Author
Founder and Managing Director Anne Morris is a fully qualified solicitor and trusted adviser to large corporates through to SMEs, providing strategic immigration and global mobility advice to support employers with UK operations to meet their workforce needs through corporate immigration.
She is a recognised by Legal 500 and Chambers as a legal expert and delivers Board-level advice on business migration and compliance risk management as well as overseeing the firm’s development of new client propositions and delivery of cost and time efficient processing of applications.
Anne is an active public speaker, immigration commentator, and immigration policy contributor and regularly hosts training sessions for employers and HR professionals
