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On 12 May 2016, the Immigration Bill received Royal Assent and became the Immigration Act 2016.

The Act gives effect to a number of Government commitments intended to curb illegal working and prevent the exploitation of migrant workers.  Its main provisions include;

  • Extending the criminal offence of knowingly employing an illegal migrant to apply where an employer has ‘reasonable cause to believe’ that a person is an illegal worker.
  • An increase in the maximum sentence on conviction on indictment for this offence from two years to five years.  
  • The creation of a new offence of working illegally, which would enable the earnings of illegal worker to be seized under the Proceeds of Crime Act 2002.
  • A power to impose compliance sanctions and close businesses that continue to employ illegal workers.
  • A requirement that public authorities ensure that public sector workers in customer facing roles speak fluent English.

Of most significance is likely to be the lowering of the threshold for the criminal offence of employing illegal workers from ‘knowingly’ to having ‘reasonable cause to believe’.  It remains to be seen how this will be interpreted by the courts but the Government have sought to address what they consider is the current ability of employers simply to ‘turn a blind eye’.  The increase in the maximum custodial sentence is also likely to raise eyebrows (as well as blood pressures)!

While the Act does now have Royal Assent it will be brought into stages on dates to be announced and we will give you further updates as they emerge.

Practical Implications?

One possible consequence of the altered threshold of criminal liability, in the short-term at least, is that employers might be given greater encouragement to dismiss employees where there is doubt about their right to work in the UK.  In that context Employers might also start to rely more heavily on using ‘some other substantial reason “SOSR” as a ground for dismissing those thought to be working illegally as opposed to ‘breach of a statutory restriction’.  The advantage of SOSR being that a genuine and reasonable belief, that a statutory restriction is being breached (even if is mistaken) can be enough to justify dismissal whereas it has been established that an employer who seeks to rely on breach of statutory duty must show that continued employment would actually contravene the duty.  Given the complexity and bureaucracy associated with immigration law this is clearly a lower threshold to meet.

A reinforcement of this approach has come from the recent Employment Appeal Tribunal decision of Nayak V Royal Mail Ltd.  Mr Nayak had made an application for a new visa, which was initially refused but was passed to the Home Office for determination following a successful appeal.  The Immigration Act 1971 allows employees the right to remain in the UK while their application is being determined.  Royal Mail had their own policy, under such circumstances, of carrying out immigration checks on employees every six months.  They were then advised (by the Home Office) that no further immigration checks would be necessary, because of Mr Nayak’s start date, if checks had been done at the start of employment.  However, no such checks had been performed and, as far as Royal Mail were concerned, the visa application remained undetermined.

Royal Mail then requested documents from Mr Nayak advising that a failure to provide them might result in dismissal.  It was explained that his original application had been made around 4 years ago and it was no longer safe to assume it remained pending and undetermined.  Following a meeting, at which Mr Nayak did not produce supportive documents, he was dismissed.  On appeal, he was given 42 days to provide the necessary documents but was unable to do so.  He had been encouraged to make a subject access request to the Home Office, so they could confirm the status of his application, but he did not do so.  His dismissal was confirmed and the Employment Tribunal subsequently found there was a genuine and reasonable belief that he no longer had the right to work in the UK.

On appeal, the EAT also decided that the dismissal was fair and agreed with the Tribunal that there was a genuine and reasonable belief that Mr Nayak did not have the right to work in the UK.  It was not necessary for Royal Mail to make further enquiries themselves, or confirm (for example) with the Home Office that appropriate checks had not been carried out at the start of the employment.  The requests to Mr Nayak over a lengthy period of time, together with the timescales given for him to obtain relevant documents, and his failure to co-operate by refusing to contact the Home Office were also relevant in the Tribunal considering the dismissal fair.   The EAT found that the Royal Mail’s failure to make the appropriate checks when Mr Nayek started work was irrelevant to the fairness of the dismissal.

The above case is certainly a good example of SOSR being used, as a ground for dismissal in this context, and is also useful when considering the extent of investigations necessary.  However, whilst employers will need to mindful of the reduced threshold of ‘reasonable cause to believe’ and the potential criminal liability which may attach, there are clear dangers in simply short circuiting any investigatory process.  Doing so and moving straight to an SOSR dismissal will no doubt increase the exposure from both an unfair dismissal and race discrimination perspective.  Whilst Nayak can be read as ‘employer friendly’ Royal Mail had made continual attempts, in line with stated policy, to have the necessary documentation provided to them.  Whilst potential criminal liability might be a graver worry appropriate advice should also be taken in relation to the employment law aspects of a proposed dismissal.

The Civil Penalty Regime

What the Immigration Act won’t do is alter the civil penalty, for employing illegal workers.  The penalty is to remain at up to £20,000 for each such worker.  Under this legislation a statutory excuse is available against liability for the penalty, if an employer has complied with prescribed requirements for ensuring the right to work in the UK.  These requirements include; obtaining, checking, copying and retaining original documents as prescribed in Home Office Guidance.  It is also highly recommended that checks be carried out for all staff, not just those who appear to be UK (or EU) citizens.  Doing so will not only ensure the statutory excuse is available but also cut down the risk of any discrimination claims arising.   

The legislation in this area is very prescriptive and it is recommended advice be taken from your Stronachs Employment Team contact if you are at all unsure of whether your business is compliant.

Euan Smith, Associate

Chambers UK 2018

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