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Will the Home Office’s Immigration Proposals Burden your Business?

Tuesday, 6 August 2013

Tougher sanctions on the employment of illegal migrants are being proposed by the Home Office. The proposals, currently in the consultation phase, should be noted by businesses as they look likely to tighten up the law and extend the liabilities of directors.

The broad aims of the proposals are to make it harder for illegal immigrants to live and work in the UK while simplifying the way the civil penalty scheme currently operates.

What is the Home Office Proposing?

The Home Office has proposed a doubling of the maximum penalty per illegal worker from £10,000 to £20,000 and making it easier to enforce unpaid penalties. Moreover, directors or partners of limited liability partnerships would be held personally liable when fines remain unpaid by their business.

Clearly then, the government is taking its clamp-down on rogue businesses seriously, but will it have wider effects?

More Red Tape and More Costs?

The proposals may be costly for businesses even if they do not break the rules. For example, HR staff will need to be brought up to speed with the new procedures causing businesses to incur further administrative costs.

Additionally, the Home Office wants to encourage employment checks based on biometric residence permits (BRPs) - micro-chipped cards containing biographical and immigration information. While already in use, BRP’s would be issued to all non-EEA overseas applicants that reside in the UK for more than 6 months. Thus, industries employing non-EEA workers, including those employing non-EEA’s applicants based on Government-recognised ‘strategically important skills’, could be affected.

These cards also make it easier to track visa expiration forcing businesses to be particularly vigilant in maintain up-to-date, accurate employment records in order to avoid hefty fines. As such, firms with small HR teams may struggle.

Is There an Upside?

The proposals do include measures designed to assist businesses; fewer documents would be needed to establish an employee’s status, for example. Also, fewer follow-up checks for non-EEA nationals would be required, possibly resulting in long term efficiency and faster turnaround times.

Finally, the effects of the revised procedures are limited in scope. Sectors employing primarily EU Citizens would be unaffected by the proposals.

Comment

Where penalties are incurred, they may have a disproportionate effect on small businesses as the Home Office report suggests there will be fewer opportunities to minimise the fines. Although new legislation would retain some of the current mitigating factors, they would be restricted in scope.

Evidence of a partial check on an employee’s status would no longer reduce the penalty fee and, although cooperation with investigations would still result in penalty reduction, a prompt and accurate provision of information would be required.

Businesses with a high number of non-national workers and inadequate HR teams may find active cooperation difficult to achieve, making them less likely to receive a reduction.

Evidently, some businesses will need to be more prepared than others, not only to minimise additional costs but to avoid fines too. For specialist advice contact Peter Gourri today by email PGourri@rollingsons.co.uk or telephone 0207 611 4848.

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