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Civil Penalty UK Immigration Notice

It is a distressing experience for an organisation when, without warning, it receives a civil penalty UK immigration notice.

A civil penalty notice informs an organisation it has employed someone who did not or does not have permission to work in the UK, in breach of the prevention of illegal working regime.

It is in every organisation’s best interests to avoid being found liable and ‘named and shamed’ for employing illegal workers.

The civil penalty regime applies equally to all employers of migrant workers, catching out both employers who choose to ignore their obligations as well as more diligent employers who ‘unknowingly’ hire illegal personnel, for example because of a flaw in their onboarding processes.

Either way, if you are found liable for a civil penalty, you face a fine of up to £20,000 per illegal worker. Which means if the civil penalty notice relates to several workers, the sums involved can quickly mount and become detrimental to your organisation’s operations.

If the Home Office establishes that you ‘knowingly’ hired illegal workers or workers subject to immigration controls, you could face criminal prosecution as well as an unlimited fine.

You are also likely to be downgraded on the register of sponsors, or have your licence revoked altogether. This becomes business-critical when your organisation can no longer bring non-European personnel to the UK.

Given the potential financial, operational and reputational impact of a civil penalty notice, employers that are found liable for a breach of their immigration obligations should give serious consideration to their options for appealing the civil penalty.

 

How to respond to a Civil Penalty for Illegal Working

A business can either accept and pay the civil penalty for illegal employment, or return an objection form.

Acceptance is encouraged by the Home Office. Payment plans can be arranged and if full payment is received within 21 days the organisation is rewarded with a 30% discount.

On the other hand, the objection process can appear risky and pointless.

Potential objectors are warned that if they elect to challenge the penalty, the Home Office may decide to increase it.

It may, for example, determine that the mitigation applied for an organisation’s cooperation is no longer applicable.

An objection may also seem futile. The review is, after all, undertaken by the same people who fixed the civil penalty UK immigration notice in the first place. They rarely change their mind.

While an objection can appear pointless, it is a necessary stage of the process. A right of appeal to the County Court only arises if an applicant has first formally objected to the decision.

Organisations may feel they have suffered an injustice that does not fit neatly within the narrow grounds of objection the Home Office deems acceptable.

While the Home Office is unlikely to take these matters into account, a County Court judge may be more willing to hear them.

 

Five possible objections to a Civil Penalty UK Immigration Notice 

1. No proof of the offence

If an appeal advances to the County Court, the Home Office will be required to prove an organisation has committed an offence under the Act.

Section 15 requires the Home Office to prove two things:

  • A person did not have the appropriate right to work in the UK; and
  • A business employed that person.

 
The Home Office must provide sufficient evidence to prove each of these elements and a valid defence may simply be that it has failed to do so.

A business may, for example, dispute it ever employed a person, because that person was working as an independent contractor or was engaged through a recruitment agency.

In the Court of Appeal case of James v London Borough of Greenwich [2008] EWCA Civ 35, it was determined that a worker engaged through an agency does not become an employee merely because they have worked for a business for a long period. It was held that an employment contract could only be implied if a business insists on the agency supplying a particular person.

 

2. The due diligence excuse

Under section 15(3) of the Act, an employer is excused from paying a civil penalty UK immigration notice if it shows it has complied with the ‘prescribed requirements’ in relation to the employment.

Those requirements are outlined in the Immigration (Restrictions on Employment) Order 2007.

An employer is excused from paying a penalty if:

  • The employee has produced to the employer a listed document such as a UK or EU passport, Birth Certificate or Residence Permit;
  • The employer has taken all steps to check the validity of the document and that the employee is the rightful owner;
  • The employer has copied all relevant material and kept a copy for a period not less than two years after the employment has come to an end; and
  • The employer checked any photograph and DOB and determined that it was consistent with the employee’s appearance.

 
If an organisation has complied with these requirements, it has the onus of proving that this exception applies by producing the relevant documents.

 

3. The Home Office has exceeded its powers

A further basis for challenging a civil penalty UK immigration notice may be that the Home Office has obtained evidence unfairly or in excess of its statutory powers.

The Home Office has a wide range of powers to investigate and enforce civil penalties, but they must follow strict protocols and act within their authority.

This means, for example, they must have specific authority to conduct an ‘immigration raid’, as opposed to entering premises for other official purposes.

 

4. Statutory mitigating factors

When assessing the penalty amount to impose, the Home Office takes into account a number of factors:

  • The nature of the checks carried out by the employer;
  • The number of offences previously committed by the employer;
  • If the employer reported suspected illegal workers to the Home Office; and
  • Whether the employer cooperated with the Home Office in any investigation.

 

A civil penalty for employing illegal workers can be challenged on the basis that one of these relevant factors was not properly taken into account.

 

5. Other mitigating factors

The wording of section 15 (2) of the Act, “The Secretary of State may give an employer who acts contrary to this section a notice…” suggests that the Home Office also has an overriding discretion not to issue a penalty at all, even where the elements of the offence have been proven.

The wording of section 19 of the Act, “The Secretary of State shall issue a code of practice specifying factors to be considered…”, rather than “specifying THE factors to be considered” suggests that the Home Office should also take into account other relevant factors that emerge.

It could be argued that this interpretation places a duty on the Home Office to consider all relevant factors and determine whether it is appropriate to issue a penalty at all, rather than take into account only the narrow considerations contained in the Home Office guidelines.

The expense, time and energy required to object and appeal a decision can seem excessive, but if a business receives a civil penalty UK immigration notice, there are significant consequences and many reasons to appeal a civil penalty for immigration.

 

How to challenge the UKVI civil penalty 

If you are issued with a UKVI civil penalty notice for illegal working, you have 28 days to pay the fine or to appeal to the Home Office. So it’s important to act quickly, decisively and effectively.

With the stakes so high, having a strategy in place will help you follow the civil penalty appeals process correctly and put the strongest case forward for your organisation. You should also be prepared for a Home Office visit as part of the appeal.

 

Stage 1

Your first recourse is to write to the Secretary of State to lodge your objection(s). This must be within 28 days of the penalty being issued.

There are three types of objection:

  1. You are not liable to pay the penalty, for example because you are not the employer of the workers in question.
  2. You have a statutory excuse under Section 15 of the Immigration, Asylum and Nationality Act 2006. This applies if you can prove that you carried out relevant document checks of the relevant workers’ documentation before they commenced employment, that you took reasonable steps to ensure the validity of documents and as such that you were unaware of their illegal status. You would therefore not be in breach and not liable to pay the penalty.
  3. The level of the penalty is too high, for example, if you meet specified mitigating criteria such as being cooperative with the Home Office investigation or having some reasonable measures in place for compliance.

 

It’s important to note that UKVI can increase the level of your original penalty following an appeal, so you need to be confident there are no grounds to justify an increase in the level of penalty.

The approach you take to challenging your civil penalty notice will depend on your specific circumstances and the nature and level of the civil penalty notice itself. Seeking professional advice can help provide you with a defence strategy to ensure you take the most effective approach to your appeal and minimise the potential for an uplift in the fine.

 

Stage 2

If your written appeal is rejected, the next stage is to make a further objection to the County Court. You have to do this within 28 days of the Home Office’s final decision.

This will lead to a rehearing, where the court can look at any documentation it considers relevant, including documents not considered by UKVI.

Thorough preparation for this hearing is critical. You need to build a strong case based on facts and robust evidence. In our experience, UKVI will prefer to settle in advance of a hearing where there is evidence of non-liability of employers, so good preparation can increase the likelihood of settling before the full hearing takes place.

If your organisation is facing a civil penalty for illegal employment, contact us to discuss strategies for your appeal.

Or for guidance on how to avoid being found liable for a civil penalty notice, please get in touch.

 

Need assistance? 

To discuss all the options available for appealing a civil penalty and keeping your business’ clean record, please get in touch.  

 

Challenging a civil penalty FAQs

What is a civil penalty issued under UK immigration law?

A civil penalty under the Immigration Act can be issued by the Home Office in the event an employer is found to be or have been employing someone who does not have the right to work in the UK.

What is the penalty for working illegally in UK?

Employers can face fines of up to £20,000 per illegal worker, and in some cases up to 5 years in prison.

What is a statutory excuse?

Employers may be able to rely on a statutory excuse to cancel a civil penalty for illegal working if they can show they conducted compliant right to work checks on the illegal worker.

Last updated: 5 February 2021

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