Civil penalty fines for employers and landlords to increase from 13 February

The government has confirmed that the planned increases to civil penalty fines for employers and landlords will come into force on 13 February 2024.

The increase was first announced last summer, as part of a wider government crackdown on illegal working and renting in the UK.

The Home Office has now published updates to its Code of Practices for the Right to Work Scheme and the Right to Rent Scheme, setting out details of the new fines and the prescribed checks that employers and landlords should conduct to avoid a civil penalty in the event of illegal working or renting.

Under the new rules, civil penalty fines will be more than tripled for employers and landlords who employ or let property to foreign nationals who do not have the right to work or rent in the UK.

What are the new civil penalty fines?

From 13 February 2024:

  • The civil penalty for employers will increase from £15,000 to a maximum £45,000 per illegal worker for a first breach of the Scheme, and from £20,000 to a maximum £60,000 per illegal worker for repeat breaches.
  • For landlords, the civil penalty for a first breach will increase from £80 per lodger and £1,000 per occupier, to up to £5,000 per lodger and £10,000 per occupier. Repeat breaches will increase from £500 per lodger and £3,000 per occupier to £10,000 and £20,000 respectively.

How to avoid a civil penalty

In order to establish a statutory excuse against a civil penalty in the event that an employee or tenant is found to be working or renting illegally, employers and landlords must conduct one of the following checks:

  • A manual right to work check (all citizens);
  • A right to work check using Identity Document Validation Technology (IDVT) via the services of an Identity Service Provider (IDSP) (British and Irish citizens only); or
  • A Home Office online right to work check (non-British and non-Irish citizens).

The check must be carried out before the employee or tenant commences their employment or tenancy.

Increasing use of online checks

Increasingly, the Home Office is issuing eVisas rather than issuing physical documents as proof of an individual’s immigration status. This means those individuals will only be able to evidence their right to work or right to rent using the Home Office online service.

The Home Office online right to work and right to rent checking services set out what information and/or documentation you will need in order to access the service. However, it will not be possible to conduct an online check in all circumstances, as not all individuals will have an immigration status that can be checked online at this stage.

In circumstances where a Home Office online check is not possible, you should conduct a manual check. For British or Irish citizens who hold a valid passport (or Irish passport card) you can also use the services of an IDSP instead of conducting a manual check if you wish.

How is a civil penalty administered?

Employers and landlords who fail to carry out one of the above checks in the prescribed manner will not have a statutory excuse and are therefore liable for a civil penalty if an employee or tenant is found to be working or renting illegally.

A civil penalty is administered in the following stages:

The Scheme is deemed to be breached if you are found to be employing or letting property to a person who does not have the relevant immigration permission.

You will be served with a Referral Notice informing you that the details of your case are being referred to the Home Office for consideration of liability for a civil penalty.

Information request:

The Home Office will contact you with an Information Request giving you the opportunity to present further information and evidence of a statutory excuse which will inform the decision on liability.

The Home Office will review all the evidence available and decide if you are liable for a civil penalty. If you are found to be liable, you will be issued with a Civil Penalty Notice.

Paying the penalty:

You must pay the civil penalty by the date specified in the Civil Penalty Notice or object to the notice.

Objecting to the penalty:

If you have received a Civil Penalty Notice from the Home Office, you can object in writing within 28 days of the due date specified in the notice. Details of the reason for objecting must be supplied along with evidence supporting one or more of the acceptable grounds for objection as set out on the Objection Form.

Appealing against the penalty:
If your objection has determined that you remain liable for a civil penalty, you may then appeal to the County Court if you are not satisfied with the decision. You may only appeal on the same grounds on which you could object to a penalty.

Enforcement and other consequences of a civil penalty:
If you do not pay the penalty in full or by instalments, or object or appeal, by the specified due dates, the penalty will be registered with the civil court, after which enforcement action may be commenced immediately. If an employer is liable for a civil penalty, this could also affect their ability to sponsor migrants who come to the UK in the future.

Support with immigration compliance

Right to work and right to rent checks which were carried out in the prescribed manner prior to 13 February 2024 will be considered in line with the version of the Code of Practice that was in force at the time the check was made.

With the higher fines set to come into force next week, employers and landlords should ensure they are aware of their legal obligations and are undertaking the correct checks on all employees and tenants.

Should you require more information or training for your staff on immigration compliance, Smith Stone Walters can help. To speak to a qualified immigration advisor about your requirements, please contact us today.

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