Lexis PSL: Immigration Act 2016—illegal working and the lawful employment of workers

28/06/2016


Immigration analysis: What will the Immigration Act 2016 (IA 2016) mean in practice? Sophie Barrett-Brown, senior partner and head of the UK practice of Laura Devine Solicitors in London, considers the key provisions relating to illegal working and the lawful employment of workers.

What are the key provisions relating to illegal working and the lawful employment of workers?
The two most significant provisions relate to a new illegal working offence for migrants and an amended illegal employment offence for employers.

IA 2016, s 34 inserts s 24B into the Immigration Act 1971 (IA 1971) to create the much-criticised new criminal offence of illegal working. The offence is committed when a migrant works in the UK when s/he knows or has ‘reasonable cause to believe’ that s/he is ‘disqualified’ from working in the UK. Disqualification from working is defined to include where a migrant has not been granted leave to enter or remain in the UK, or their leave to enter/remain is invalid, has ceased to have effect or is subject to a condition preventing work of that kind. The offence carries a maximum term of imprisonment of up to six months (rising, in England and Wales, to 51 weeks for offences committed once section 281(5) of the Criminal Justice Act 2003 comes into force) or a fine, or both. Further, a confiscation order may be made under section 70 of the Proceeds of Crime Act 2002 to seize the earnings of the convicted illegal worker.

IA 2016, s 35 amends section 21 of the Immigration, Asylum and Nationality Act 2006 (IANA 2006), relating to the offence of employing illegal workers. It widens the scope of the offence to include not only employers who knowingly employ illegal workers but also employers who have ‘reasonable cause to believe’ that the employee is disqualified from employment by reason of their immigration status. In addition, the maximum term of imprisonment for the offence is increased from two to five years.

IA 2016 also empowers immigration officers to arrest without warrant any person who they have ‘reasonable grounds for suspecting’ has committed or is attempting to commit the offence of employing a person illegally and enables immigration officers to issue an ‘illegal working closure notice’ to close business premises for up to 48 hours in certain circumstances.

When will the changes take effect?
The first commencement order for IA 2016 made on 23 May 2016 provides that the offences of illegal employment and working in the UK illegally will come into effect on Tuesday 12 July 2016.

Are any of these changes welcome?
While the government has lauded the implementation of these new offences as a means to clamp down on employers who ‘turn a blind eye’ to illegal working, their scope is far wider and businesses and individuals should view these changes with great caution.

The provisions are particularly contentious given that the new offences lower the threshold for culpability to having ‘reasonable cause to believe’ that illegal working or employment of an illegal worker is taking place and simultaneously increase the maximum penalties.

What are the main concerns?
The main concerns for employers and individual migrants stem from the wide scope of these two offences. For employers, the fact that they did not explicitly know that employment was unlawful will not protect them from criminal prosecution under IANA 2006, s 21 if they could be found to have had ‘reasonable cause to believe’ that the worker did not have (or had ceased to have) the correct immigration permission for the work in question. It should also be noted that

a business will be ‘treated as having reasonable cause to believe a fact about an employee if a person who has responsibility within the body for an aspect of the employment has reasonable cause to believe that fact’.

IA 2016 itself provides no definition of ‘reasonable cause to believe’ and guidance has yet to be published. While it is a term that appears elsewhere in criminal law, it remains to be seen how it will be interpreted in the immigration context and how the CPS will exercise its discretion whether or not to prosecute. Certainly the intention is to create a higher threshold than mere negligence (after all that is the function of the civil penalty regime) but equally it is clear (not least from Minister James Brokenshire’s comments during the passage of the Bill) that the intention is to significantly lower the bar in order to make prosecution easier, so we can expect prosecutions to rise and employers should be cautious.

The explanatory notes to the Immigration Bill state that these offences were broadened to capture, in particular, employers who deliberately did not undertake right to work checks in order that they could not have the specific intent required to ‘knowingly’ employ an illegal worker. However, their scope is far wider and can catch even employers who did undertake right to work checks but have subsequently received information giving them reasonable cause to believe the person does not, or no longer has, the right to work.

The repercussions for businesses found guilty of having ‘reasonable cause to believe’ (or knowing) that they are employing an illegal worker extend beyond the new provisions in IA 2016. Those businesses holding a Tier 2 sponsor status could also find their licences revoked and the immigration permission of all migrant employees sponsored under the licence curtailed. The revocation of a Tier 2 licence may also prevent the business from applying for another Tier 2 licence for a period of up to 12 months, grievously hamstringing the business’s ability to continue the business with overseas workers.

As a result of the reduced threshold for culpability and the seriousness of the consequences (both in terms of criminal penalties and practical consequences), we may well see employers taking action to suspend or terminate employment more swiftly (perhaps too hastily from an employment rights perspective) in the interest of avoiding risks under IANA 2006, s 21.

Individuals who have ‘reasonable cause to believe’ (or know) they are working illegally in the UK due to their immigration permission will be liable to prosecution. The uncertainty of precisely how ‘reasonable cause to believe’ will be interpreted and in what circumstances the CPS will choose to prosecute equally present concerns for individuals (as well as the spectre of confiscation orders if convicted) and arguably their position is more complex—not least because in practical terms informing this group is more challenging than employers. Individuals are likely to be less well informed than businesses, having less access to reliable information and resources, and yet the consequences may be life-changing for migrants and their families. Many may have little or no appreciation of the significance of the new illegal working offence and how easily they may be able to fall foul of the provisions.

Perhaps of greatest concern are those migrants who are most vulnerable. Despite government claims that these provisions will protect low-skilled and vulnerable workers from exploitation, it is feared that the criminalisation of working in the UK without the correct immigration permission may have precisely the opposite effect, driving exploited workers further underground.

What should immigration advisers be doing to prepare for the changes?
For those advising corporate clients, preparation may include providing up to date training and undertaking audits of clients’ HR systems, processes and right to work documents, to ensure clients properly understand and implement right to work checks to maintain the statutory excuse for all employees. In terms of systems, businesses should in particular review their procedures in relation to changes of circumstances/new information received after the employment has commenced and ensure all HR and line managers understand what circumstances may trigger having ‘reasonable cause to believe’ and the action to be taken when new information about the employee’s immigration status is received.

For those acting for migrants, preparing clients is practically more complex as it is not founded on the implementation of systems across a business but on the understanding of individual migrants. It will be particularly important that advisers ensure that all individual clients understand from the outset the existence of these offences and the potential severity of the consequences of working illegally in the UK, in order to assist clients in avoiding illegal working occurring and recognising when they need to seek further advice.

What predictions are likely for the future?
Although IA 2016 gives effect to the government’s express wish to create a ‘hostile environment’ for those in the UK illegally, it remains to be seen to what extent criminal prosecutions, of employees and individuals, will increase.

In respect of employers, the number of civil penalties issued has remained high in the last few years (1,974 in the financial year ending 2015) in marked contrast with the relatively low number of illegal employment convictions under IANA 2006, s 21 (just four in 2014). Given the cost implications of criminal proceedings we would anticipate the trend in the use civil penalties to continue, however an increase in prosecutions for the expanded IANA 2006, s 21 is certainly expected. Whether it will be reserved for the more flagrant cases (such as wilfully turning a blind eye) or used more widely only time will tell.

As regards the new IA 1971, s 24B offence, its use is even more difficult to predict. There are already several existing immigration offences for individuals under IA 1971, s 24 for those who enter the UK illegally, overstay in the UK or breach a condition of their immigration permission (including working when it is prohibited). It is hard to conceive of any circumstance in which an individual could be liable under the new IA 1971, s 24B illegal working offence without being liable under one of the existing offences, yet prosecutions for those offences are rare. Given that the introduction of the new offence is a product of the government’s explicit intention to create a ‘hostile environment’ for illegal migration, one would anticipate that government will wish to be seen to be making use of these provisions.

Of the new power given to the government to seize earnings of an individual guilty of illegal working under the Proceeds of Crimes Act 2002, it seems likely that its use will be tempered: the Crown Prosecution Service Guidance on the Proceeds of Crime directs that a ‘proportionate use of resources to pursue confiscation’ must be applied.

What does seem certain, is that the ‘hostile environment’ is unlikely to diminish for the foreseeable future.

What does the change of illegal work terminology from a focus on ‘employment’ to ‘work’ mean in practice? Why was this changed?
IA 2016, s 34 amends IA 1971, s 3(1)(c)(i) to refer to the power to grant leave subject to conditions restricting ‘work’ (previously ‘employment’) or occupation. This change reflects the reality of the nature of the conditions placed on migrants’ immigration permission, as working restrictions are not limited simply to employed work, and is more consistent with the Immigration Rules (which define employment—although not in line with the employment law meaning of that term—as including ‘paid and unpaid employment, paid and unpaid work placements undertaken as part of a course or period of study, self-employment and engaging in business or any professional activity’).

The new offence of illegal working created by IA 2016, s 34 also utilises the term ‘work’ and ‘working’. IA 2016 defines the meaning of ‘working’ for the purpose of the offence, specifying nine forms of working including: working under a contract of employment/apprenticeship, a contract for services (ie self-employment), a contract personally to do work and working for a purpose related to a contract to sell goods as well as various specified roles (eg working as a constable). Framing the offence in this way is intended to capture any migrant who works in the UK without the necessary immigration permission to do so, whether that illegal working is on an employed, self-employed or other basis will not be material.

In contrast, IA 2016, s 35 (in respect of the employer’s offence) continues to refer only to ‘employment’ and there is no change to the definition of employment in IA 2016. Under IANA 2006, s 25, ‘employment’ related to the offence of employing an illegal worker is defined as ‘employment under a contract of service or apprenticeship, whether express or implied and whether oral or written’ and it remains a question of employment law as to whether or not the work constitutes employment—if it does not, the offence is not committed by the employer.

Sophie Barrett-Brown specialises in all aspects of UK business immigration and nationality law as well as EU free movement law.

Interviewed by Kate Beaumont.

This article was first published on Lexis®PSL Immigration analysis on 28 June 2016. Click for a free trial of Lexis®PSL.