Received a Civil Penalty Notice?

The first step is to identify the deadline and preserve all relevant evidence.

A Civil Penalty Notice should not simply be treated as an invoice.

The employer may have grounds to argue that it is not liable, that a statutory excuse existed, or that the Home Office has calculated the penalty incorrectly or failed to take relevant mitigation into account.

The evidence available at this stage can therefore materially affect the outcome.

How Much Can the Civil Penalty Be?

The final figure can depend on the employer’s previous compliance history and whether applicable mitigating factors justify a reduction.

Each worker is considered separately. A business alleged to have employed several people illegally can therefore face a substantial aggregate penalty.

What Is a Civil Penalty for Illegal Working?

The civil penalty scheme forms part of the UK’s prevention of illegal working regime.

An employer can be liable where it employs a person who does not have permission to undertake the work in question and the employer cannot establish the prescribed statutory excuse.

The issue is not limited to individuals with no immigration permission at all.

A person may have immigration permission but still be prohibited from undertaking a particular role, working particular hours or carrying out particular activities.

The Statutory Excuse

A central question in many civil penalty cases is whether the employer established a statutory excuse by carrying out the prescribed right to work check.

See our Right to Work & Employer Compliance service for preventative compliance advice.

What If the Employee Produced False Documents?

The existence of a false document does not automatically determine whether the employer has a statutory excuse.

The question will include whether the prescribed checking process was carried out and whether the document or information should reasonably have caused concern during that process.

The facts should therefore be examined carefully rather than assuming that either the employer or employee’s position is conclusive simply because a document later proves false.

Referral Notice

An employer may first receive a Referral Notice informing it that the Home Office is considering whether a civil penalty should be imposed.

This is an important stage because records should immediately be preserved and the circumstances of the employment reconstructed while relevant evidence remains available.

Documents can include recruitment records, copies of right to work checks, online check results, share codes, Home Office correspondence, Employer Checking Service responses, employment contracts and payroll records.

Civil Penalty Notice

If the Home Office concludes that the employer is liable, it can issue a Civil Penalty Notice.

The notice states the penalty, identifies the relevant worker or workers and explains the options available to the employer.

The accompanying Statement of Case should also be examined carefully because it sets out the Home Office basis for liability and its penalty calculation.

28-Day Objection Deadline

The precise date shown on the notice should always be checked immediately.

An objection should identify the applicable statutory ground and should be supported by the relevant evidence rather than relying on a general explanation of what happened.

Grounds for Objecting

Current Home Office guidance recognises three principal grounds of objection.

Can the Penalty Be Reduced?

Potentially.

The Home Office calculates penalties using the applicable Code of Practice and relevant mitigating factors.

The employer’s history, cooperation and compliance position may affect the amount payable in an individual case.

The focus should therefore be not only on whether liability can be cancelled altogether, but also on whether the amount has been correctly calculated.

First Breach or Repeat Breach?

The distinction can make a significant difference to the starting penalty.

A first breach currently carries a starting figure of £45,000 per illegal worker.

A repeat breach within the relevant three-year period carries a starting figure of £60,000 per illegal worker.

A Civil Penalty Notice that was successfully cancelled after objection or appeal and was not replaced with a Warning Notice is not treated as a previous breach for this calculation.

Fast Payment Option

The current scheme provides a fast payment option in qualifying cases.

An employer receiving its first civil penalty can potentially receive a 30% reduction if the penalty is paid in full within the required 21-day period.

The fast payment option is not available for repeat penalties and cannot ordinarily be combined with payment by instalments.

Importantly, an employer that objects within the permitted deadline can remain eligible for the fast payment option if a penalty remains payable after the objection.

Should You Pay or Object?

This decision should be made after reviewing the merits and the financial consequences.

Fast payment can produce a substantial discount, but payment without first examining the statutory excuse, liability and mitigation position can mean giving up the opportunity to challenge a penalty that may be defensible or overstated.

Equally, an objection should not be submitted merely to delay payment where there is no proper basis for it.

Objection Outcome

Following an objection, the Home Office can cancel the penalty, reduce it or maintain it.

If the Home Office concludes that the penalty should instead be increased, it can issue a new Civil Penalty Notice.

The objection outcome and accompanying reasoning should be reviewed before deciding whether an appeal is justified.

Appeal to the County Court

Where an objection has been determined and the employer remains liable, an appeal can be brought to the County Court in England and Wales.

The court appeal is not simply another informal Home Office review.

The grounds correspond with those available at objection stage, and the evidence and legal basis of the challenge should therefore be prepared carefully.

If an appeal is unsuccessful, the court can order the employer to pay the Home Office’s reasonable costs of defending it.

Evidence for a Civil Penalty Challenge

The strength of an objection or appeal will often depend on contemporaneous evidence.

Home Office Enforcement Visits

Civil penalty cases frequently arise following Immigration Enforcement activity at business premises.

Where an enforcement visit occurs, businesses should preserve documents and obtain a clear record of what was requested, what was supplied and what was said by relevant employees or managers.

The existence of an enforcement visit does not itself establish civil penalty liability.

The employer’s actual right to work records and statutory excuse position still require examination.

Impact on a Sponsor Licence

A civil penalty can create serious difficulties for a licensed sponsor.

The Home Office may consider illegal working and right to work failures when assessing whether an organisation remains suitable to sponsor migrant workers.

Depending on the circumstances, the matter can contribute to sponsor compliance action, including suspension or revocation.

See our Sponsor Licence Suspension & Revocation service.

Impact Beyond the Financial Penalty

The commercial consequences of a civil penalty can extend beyond the amount stated on the notice.

Home Office guidance identifies possible consequences including publication of the employer’s details, sponsor licence implications and consequences for certain regulated licences.

Unpaid penalties can also be registered with the civil court and enforced as a debt.

The wider impact should therefore be considered when deciding how a penalty is handled.

Criminal Liability for Knowingly Employing an Illegal Worker

The Government states that conviction can result in up to five years’ imprisonment and an unlimited fine.

Where the Home Office allegations suggest knowing employment rather than a checking failure alone, the matter requires correspondingly careful handling.

Director & Licensing Consequences

Home Office guidance also identifies wider sanctions that may arise in serious illegal working cases.

These can include business closure and compliance orders, director disqualification and consequences affecting certain alcohol, late-night refreshment, taxi or private hire licences.

The precise risk depends on the facts and the enforcement action being taken.

Public Naming of Employers

Immigration Enforcement publishes information about businesses that have received illegal working civil penalties.

The Home Office continues to publish quarterly regional reports identifying liable businesses and final penalty values after appeal rights are exhausted.

A civil penalty can therefore have reputational consequences in addition to the direct financial cost.

Common Issues We Review

How We Assist

1. Immediate Notice Review

We review the Civil Penalty Notice, Statement of Case, deadline, Home Office allegations and penalty calculation.

2. Statutory Excuse Analysis

We assess whether the employer carried out a prescribed right to work check and whether a statutory excuse was established or maintained.

3. Evidence Review

We examine recruitment, employment, immigration and right to work records and identify evidence relevant to liability and mitigation.

4. Civil Penalty Objections

We prepare objections addressing liability, statutory excuse and penalty calculation where there is a proper basis to challenge the notice.

5. County Court Appeals

Where a penalty is maintained following objection, we advise on the merits and procedure of a County Court appeal.

6. Sponsor Licence & Compliance Risk

We consider the wider implications for sponsor licensing and assist businesses with remedial right to work and immigration compliance measures.

What is the maximum penalty for employing an illegal worker?

The current Home Office scheme has a starting penalty of £45,000 per illegal worker for a first breach and £60,000 per worker for a repeat breach within the relevant three-year period, subject to applicable reductions.

Can a civil penalty be challenged?

Yes. An employer may object on prescribed grounds, including that it is not liable, that it had a statutory excuse or that the penalty amount is too high.

How long do I have to object?

Current Home Office guidance provides a 28-day objection period. The exact deadline stated on the Civil Penalty Notice should be checked immediately.

What is a statutory excuse?

It is the employer’s defence against civil penalty liability where the prescribed right to work checking requirements were correctly followed and, where required, appropriate follow-up checks were completed.

Can the penalty be reduced?

Potentially. The Home Office applies the Code of Practice and relevant mitigating factors when calculating the final amount. The calculation and supporting evidence should be reviewed carefully.

Is there a discount for paying quickly?

A qualifying first-time penalty can currently attract a 30% fast payment reduction where payment is made in full within the applicable 21-day period.

Can I appeal after an objection is refused?

Yes. In England and Wales an employer can potentially appeal to the County Court after an unsuccessful objection, normally within the deadline stated in the objection outcome or new penalty notice.

Can a civil penalty affect a sponsor licence?

Yes. Illegal working and right to work failures can have implications for an organisation’s suitability to hold a sponsor licence and may contribute to Home Office compliance action.

Can the business be publicly named?

Yes. Immigration Enforcement publishes information about employers that have been found liable for illegal working civil penalties.

Can illegal working result in criminal proceedings?

Yes. Criminal liability can arise where an employer knew or had reasonable cause to believe that a person did not have the required right to work. The Government states that conviction can carry up to five years’ imprisonment and an unlimited fine.

Official Civil Penalty Guidance

The Home Office publishes the illegal working penalties and Codes of Practice for employers.

Employers can review the current Code of Practice on preventing illegal working.

The Government also publishes guidance on penalties for employing illegal workers.