The UK Government’s latest statistics reveal a 24% drop in visa applications in the first three months of 2024. In addition to new immigration rules to curb legal migration, the government is cracking down on illegal working practices. Compliance visits have increased by 50% compared to 2023, reaching a peak not seen since 2019. Recruitment sites like Indeed have recently advertised government immigration enforcement officer roles, indicating an intention to ramp up compliance visits.
Who is most at risk from a visit of a compliance visit?
Hospitality, Leisure, and Retail
From January to October 2023, immigration officers conducted over 100 visits to businesses in the hospitality sector. For instance, the London Marriott Hotel in Regents Park saw eleven agency workers arrested for working illegally. The government’s news portal stated, “The visit took place as part of a Home Office campaign targeting illegal working in the hospitality sector.”
Similarly, Fat Twins, a halal fast-food chain, received a £90,000 penalty at its South London branch in Tooting. Ottoman Kitchen in Southampton was fined £45,000, and Shaan Restaurant in Oxford received a £50,000 fine. In 2021, Akbar Dynasty faced a £35,000 fine, and the Home Office revoked their sponsorship licence for failing to conduct right to work checks.
This year, civil penalties have tripled. If these fines were issued today, they would be £270,000 for Fat Twins, £135,000 for Ottoman Kitchen, and £150,000 for Shaan Restaurant. The focus on the hospitality, retail, and leisure sectors underscores the need for employers in this sector to be ready for compliance visits and avoid civil penalties.
Construction
In the construction industry, FP McCann in Northern Ireland faced a £225,000 penalty for employing five illegal contractors on 19 March 2024. In Wales, Adana Construction was fined £180,000 for employing four illegal workers. Both companies were penalised following members of the public raising concerns. Such high fines can cripple a business, potentially leading to insolvency.
Other sectors
No matter what sector your business operates in, you could be subjected to a Home Office compliance audit. It is therefore essential that all businesses carry out proper right to work checks and are fully compliant with Home Office sponsorship rules.
Likelihood of a compliance visit
In the 12 months to 31 March 2024, there were 6,720 illegal working visits, a 59% increase from the previous year (4,237) and a 79% increase compared to 2022 (3,755). With the Home Office’s recruitment drive, this figure is expected to rise in 2024-2025, making it crucial for employers to be prepared for unannounced visits.
Level of civil penalty fines
In the 12 months to 31 March 2024, 1,676 civil penalties were issued, totalling £30.49 million. This represents a 52% increase in the number of penalties and a 56% increase in value compared to the previous year (1,105 penalties worth £19.49 million).
Compliance Visits
The Home Office collaborates with the police and the National Crime Agency, adopting a cross-departmental approach. This increases the risk for companies scrutinised in other business areas unrelated to immigration. Reasons for unannounced visits include:
- No compliance visits after obtaining a sponsorship licence.
- Pre-liecence audit following a sponsor licence application.
- High-risk businesses handling sensitive information.
- High-risk public-facing businesses, such as hospitality.
- Change in direct ownership or staff transfers through the company’s Sponsor Management System (SMS) account.
- Request for allocation changes.
- Compliance visit required for the category applied for.
It is vital to be prepared to minimise the risk of civil penalties for employing workers without the right to work. At Howard Kennedy, we offer mock audits to ensure you are ready for unannounced visits and avoid penalties. Contact John Kiely for more information.
Look out for the next instalment in this immigration compliance series on Monday, 17 June 2024 – Home Office Audit: Are You Compliant?
This article has been co-authored by John Kiely (Partner, Head of Immigration) and Kerry Price (Trainee Solicitor).
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