Warning on Employing Illegal Workers

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Employers beware!

Companies are being targeted by the Insolvency Service
Home Office fines are becoming more common place

In the last 5 months of 2016, there were 11 Director disqualifications solely as a result of investigations following employment of illegal workers in the UK.

In addition, Penalty Notices of between £10,000 and £15,000 per worker were issued, these fines totalled £450,000.

Cheryl Lambert, the Chief Investigator at the Insolvency Service, said:

Employing illegal workers is not a victimless crime. These directors sought an unfair advantage over their competitors by employing people under the radar who were not entitled to work legally in the UK.

If a company is found to be employing illegal workers and not carrying out the checks they are required to by law, then the Insolvency Service will take action to remove the directors from the market place, regardless of whether the company is in Liquidation or not.

This action is a warning to other employers to seriously consider their duties and obligations.

Is liquidation a solution?

In the cases we have dealt with, the fines were not followed through to the company director, however disqualification was in fact more prevalent.

Note: In addition, an employer can be sent to jail for 5 years and pay an unlimited fine if they’re found guilty of employing someone whom they knew or had ‘reasonable cause to believe’ didn’t have the right to work in the UK. A civil penalty could be levied in the sum of £20,000 for each illegal worker employed.

So, employing someone who does not have the legal right to work in the UK could be very expensive, result in a prosecution and a director disqualification. In addition, a confiscation order could follow!

COMMENT by Richard Rones
"In my experience, Home Office actions and subsequent company fines, as well as company director disqualifications, do seem to be on the increase – it does appear that the Home Office and the Insolvency Service are talking!"

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