Illegal working and employment termination: Navigating Home Office compliance

There has been a marked clamp down on illegal working by the current government 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; and
• the recent statement from the Director of Enforcement, Compliance and Crime confirming that “dedicated Immigration Enforcement officers have been ramping up action to disable illegal working across the board“.

Illegal Working

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.

Employers have an obligation to prevent illegal working and should 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 keep records of all checks carried out. Most importantly, employers should not employ anyone who it knows, or has reasonable cause to believe, is an illegal worker; this is a criminal offence.

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, can be ‘named and shamed’ by the Home Office and amongst other things, employers with a sponsor licence could have their licence revoked or downgraded.

Statutory Excuse

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.

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Information Requests

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. The number of Information Requests being received has increased significantly in recent months as the Home Office has begun to use more sophisticated technology to share data between government departments.

While responding to such a request is not mandatory, we strongly recommend doing so as it gives you the opportunity to demonstrate that you have a statutory excuse and avoid a fine altogether or, at the very least, to co-operate with the Home Office and seek to reduce the value of a fine issued.

Right to Work Dismissals

Responding to an Information Request often raises concerns about an employee’s right to work status.  Where this is the case, it is necessary to quickly commence a HR process to protect the employer from further illegal working.  The process that is followed usually requires the employer to balance the risks of illegal working against the risks of the employee claiming unfair dismissal and potentially race discrimination.

When terminating employment, it is crucial 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. A ‘some other substantial reason’ (SOSR) dismissal, with pay in lieu of notice, would be more fitting.

For employees with less than two years’ service who are not able to pursue an ordinary unfair dismissal claim, dismissal with immediate effect is likely to occur where the employer is not satisfied that they have the right to work.  Where the employee has more than two years’ service, an investigation, meeting and dismissal process should take place but there may be occasions where the risk of an illegal working penalty outweighs the risk of an unfair dismissal claim, it is a fine balance.

Every response to an Information Request and any resulting HR process will be specific to the employee’s situation and employer’s appetite for risk and so will need to be considered on a case by case basis.

Ward Hadaway’s Immigration team is uniquely positioned to advise on both the immigration and employment aspects arising from Home Office Information Requests, please contact us.