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When an Employee Loses their Right to Work

What if an employee loses right to work? An employer’s next steps

All UK employers operate under a duty to prevent illegal working.

Failure to meet your duties under the Immigration, Asylum and Nationality Act 2006 can leave your organisation liable to a civil penalty or criminal prosecution if you employ someone who does not have the right to undertake the work in question.

Following the Home Office’s prescribed document checks will help reduce the risk of hiring personnel unlawfully, and potentially mitigate or defend any alleged breach of compliance by way of statutory excuse.

In brief, this requires you to:

  1. obtain;
  2. check; and
  3. record

specific documentation in specific formats from all of your employees, irrespective of their nationality – i.e. including British and EEA citizens.

Changes in right to work status of employees

The reality is that employees who had previously held the correct permissions to work at the point of recruitment and onboarding may, for a number of possible reasons, subsequently lose their right to work during the course of their employment.

If you have reasonable cause to believe that an employee no longer has the right to work, yet you continue to employ them, you may become liable for a civil penalty of up to £20,000 per breach, and potentially for criminal prosecution punishable for up to 5 years imprisonment.

So what do you do if you discover an employee no longer has the right to work in the UK?

Understand why their status has changed

There are many reasons why a person’s right to work status may have changed. For example:

  • their permission may have expired;
  • their permission may have been revoked due to a breach of their visa conditions;
  • their employer may have lost their sponsor licence;
  • following a TUPE transfer, the new employer does not hold a sponsor licence.

It is important to clarify the reason for the change in the employee’s status, as this will influence your next steps.

Your next steps

You risk a civil penalty and criminal prosecution if you continue to employ that individual where they are no longer permitted to undertake the work in question.

Don’t, however, be hasty! Often the initial reaction may be to terminate the employee’s contract, to avoid any potential accusation of non-compliance.

But this move could expose you to risk elsewhere, such as a claim for race discrimination, or unfair dismissal where the employee has sufficient service with the organisation.

In addition, individuals suspended from work or sent on ‘gardening leave’ are generally considered to continue to be employees and as such, may continue to put you at risk of a civil penalty if they are not permitted to work.

Therefore, before you take action, consider all of the facts of the case and all of the options available to you.

  • A revoked visa for example will require an almost immediate response, and may relate to a conduct issue.
  • An expiring visa may have a longer lead time to address, during which time you could support the employee in applying for alternative immigration routes under which you can retain the employee. In this instance, the employee should demonstrate they have submitted an application to extend further leave to remain with the Home Office prior to the expiry date and that this is in active consideration. You can verify this using the Home Office Employer Checking Service.
  • Is the grace period available for ‘overstayers’, allowing the individual time to address their situation with the Home Office, and providing you more time to investigate and explore your options?
  • For completeness – if you as an employer have lost your sponsor licence, your employees’ respective certificates of sponsorship also become cancelled, and their visas limited to 60 days, or however long remains on the visas where less than 60 days. Employees will have to leave the job and the UK unless they make a new visa application within that time.
  • Likewise, if an individual is subject to a TUPE, and the new employer does not renew their licence within 28 days, employees’ visas will be limited to 60 days or however long remains on the visa where less than 60 days. Employees will have to leave the job and the UK unless a new visa application within that time.

Changes in right to work rules

As with all HR matters, you should develop and follow a fair process based on thorough investigation and factual evidence.

For example, if you are terminating an employee’s contract, ensure that the dismissal falls within one of the potentially fair reasons for dismissal.

A case in November 2017 looked at employers relying on illegality as a fair reason for dismissal, and use of the grounds of ‘some other substantial reason’ (SOSR) where an employer has a genuine but mistaken belief in their duties. The tribunal decision is awaited (as at Dec 2017). In the meantime, employers should air on the side of caution while these questions are clarified, and seek professional advice where issues of work permission arise.

Generally, a ‘SOSR’ dismissal will be fair where an employer has a reasonable and genuine belief that the employee no longer had the right to work in the UK – irrespective of whether that belief turns out to be correct or not. This should be distinguished from dismissal for breach of a statutory duty where an employer must have the knowledge that continuing to employ the individual will breach a statutory restriction.

Employers should maintain their immigration and right to work policies and ensure that they are up to date, effective and properly utilised. In the case of a dispute, it usually goes in an employer’s favour where its systems and process are deemed fair, consistent and reasonable.

This case and recent changes in rules earlier in 2017, illustrate that right to work is a moving area, and the rules subject to frequent change. Ignorance is no defence, so it will be important to ensure as an employer you are both aware of changes and take action accordingly to ensure you remain compliant.

Prevention is best

The most effective strategy for employers to manage the risk of right to work compliance is through robust procedures implemented consistently across your organisation to prevent illegal working arising in the first place.

A systematic approach to document checking should cover all new employees, with further scheduled checks every 12 months for those with time-limited permission.

Also ensure that proper record-keeping and monitoring processes are in place, to identify when immigration permissions will expire.

A formal right to work process will help minimise the risk of illegal employment, and should enable you to rely on the ‘statutory excuse’ as a defence in the event of unintentionally employing someone unlawfully, even where the status changes during the course of employment.

Read more about meeting your right to work compliance duties and managing your List B employees.

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