Employing Someone Illegally - What Employers Need To Know

Most employers are aware that they need to ensure that anyone they hire has the legal right to work in the UK.  For those that also sponsor someone on a work visa, there are additional requirements.

Current situation

 There has been a marked clamp down on illegal working with:

• over 10,000 illegal working visits carried out in the 12 months to July 2025

• 1,948 sponsor licences revoked between July 2024 and June 2025

Illegal Working – definition

It is unlawful to employ someone who does not have the right to reside and the appropriate right to work in the UK, or who is working in breach of the conditions of their visa.

Illegal working is something that can impact all employers, not just those deliberately flouting the rules:

• a student, working in excess of their 20 hours a week during term time is working illegally,

• an employee whose visa renewal was rejected and hasn’t told their employer is working illegally.

All employers have an obligation to prevent illegal working and must carry out “right to work” checks on all prospective employees before their employment starts, conduct follow-up checks on employees who have time-limited permission to work in the UK and should also keep records of all checks carried out.

The potential penalties for employing an illegal worker are significant. An employer can be liable for a fine of up to £60,000 per illegal worker.

How to be compliant

Carrying out a compliant pre-employment right to work check provides the employer with the ‘statutory excuse’. Maintaining this excuse, via repeat right to work checks during the employment (as needed) will ‘excuse’ an employer from paying a civil penalty if they are found to have been employing someone who does not have the right to work.

To make sure this will apply, employers should:

• carry out a right to work check before the employment begins;

• obtain the employee’s original documents or check their right to work online using a share code;

• check the individual’s identity in their presence;

• retain a copy of the check and the date it was carried out; and

• conduct follow-up checks before their right to work expires.

If any employee is working for you on a visa, you need to take extra care to ensure you are fully compliant with all Home Office instructions and reporting requirements.

Illegal working and employment termination:

Where there is a suspicion of illegal working, the Home Office will typically send an Information Request to the employer, seeking additional information to assist with their enquiries.

While responding to such a request is not mandatory, we strongly recommend that you co-operate with the Home Office.

Immigration versus employment rights

Responding to an Information Request will often raises concerns about an employee’s right to work status.  Where this is the case, it is necessary to quickly commence an HR process to protect yourself from employing someone illegally because they will also have employment rights.

It is important to take advice the moment you become aware of a potential concern about work or visa status, to balance the risks of illegal working against the risks of the employee claiming unfair dismissal and potentially race discrimination (which requires no qualifying service and is compensation is uncapped).

When terminating employment, it is crucial therefore to distinguish between a situation where the employee does not have the right to work and a situation where the employee is not able to prove that they have the right to work. 

Not having the right to work renders the employment illegal, in which case dismissal for illegality, without notice is acceptable.  However, dismissal for illegality wouldn’t be appropriate where the employee did have the right to work and this could be the case even if they cannot evidence their right to work. So, tread carefully.

To summarise

·       Make sure you carry out Right to Work checks before employment starts

·       Keep records of all checks made in case of challenge by the Home Office

·       If you are sponsoring an employee on a work visa, make sure you understand the increased expectations with regard to reporting and record keeping

·       Any employee you hire, probably has employment rights so don’t act in haste. Take advice.

---

Interesting case

A prominent case involved the law firm Osborne Clarke, which lost a race discrimination claim in 2009 for having a recruitment policy that indirectly discriminated against ethnic minorities. 

Details of the Osborne Clarke v Purohit case:

• The policy: The firm had a rule against hiring trainee solicitors who did not already have the right to work in the UK. They justified this on the grounds of cost.

• The claimant: The claimant, Mr. Purohit, challenged the policy, arguing that it constituted indirect race discrimination. He asserted that the policy had a disproportionate negative impact on ethnic minority candidates, who are more likely to require sponsorship.

• The ruling: The Employment Appeal Tribunal (EAT) sided with Purohit, ruling that the policy was discriminatory. It found that the firm's justification of cost was not sufficient, especially considering the firm's financial resources.

• Key takeaway: The EAT ruled that the law firm should have continued the recruitment process on merit and considered the issue of work sponsorship only at a later stage. This case remains a binding precedent for tribunals and is often cited in discussions about employment and immigration law.

While this case did not involve the dismissal of an illegal worker, it is a significant instance of a law firm losing a race discrimination case related to a worker's immigration status. 

Discrimination and illegal workers

The search results also show that illegal workers have successfully brought discrimination claims against employers in the UK, although they cannot claim for unfair dismissal.

• The Supreme Court case of Hounga v Allen (2014) established that it is not against public policy to allow illegal workers to claim discrimination in certain circumstances. The court ruled that refusing a discrimination claim based on a worker's illegal status could effectively give employers a "licence to discriminate" against vulnerable people.

• In that case, the Supreme Court determined that there was no "inextricable link" between the worker's illegal immigration and the racial harassment they had experienced at the hands of their employers.

This article was produced using content prepared by Flora Mewies, Partner, Employment & Head of Immigration at Ward Haddaway, our legal partners.