Rogue employers face up to £60,000 fine as HMRC intensifies migrant worker crackdown

Businesses employing illegal migrant workers face fines of up to £60,000 per illegal worker under HMRC’s intensified clampdown on large scale abuse of the UK’s immigration legal system, according to Midlands law firm Sydney Mitchell.

The warning comes after reports emerged of increased numbers of unannounced compliance visits by UK Visas and Immigration (UKVI) investigators.

UKVI is growing increasingly tough on illegal working and clamping down on “rogue” employers, whilst seemingly caving in to mounting pressure to reduce legal migration, which, according to reports, is behind the dramatic increase in the number of sponsor license suspensions and revocations.

André Minnaar (pictured), partner and head of the Immigration Team said: “In recent weeks, there have been multiple reports that confirm that UKVI has increased compliance visits of sponsorship licence holders as part of a broader government effort to intensify a crackdown on businesses holding sponsor licenses and those employing migrant workers, to monitor whether the licence holders are genuine and complying with their duties.

“This has led to a dramatic increase in the number of sponsor license suspensions and revocations, coinciding with a noticeable increase in enforcement visits targeting illegal working.

“If found to be employing any illegal workers, businesses face huge fines of £45,000 per illegal worker for a first offence and £60,000 per illegal worker for a repeat offence in a three year period.”

According to the most recent Home Office data, in the first half of 2024, 833 Skilled Worker sponsors had their licence suspended and 709 Skilled Worker sponsors had their licence revoked.

This is a dramatic increase compared to the previous year when 569 Skilled Worker sponsor licences were suspended and 337 were revoked.

The care home industry is one of the UK’s largest employers of migrant workers and holders of Skilled Worker sponsor licences.

Andre said: “The trend began in 2024 after UKVI uncovered large scale abuse of the skilled visa system by care home agencies who was sponsoring health care workers.

“This led to an unprecedented number of sponsor licence suspensions and revocations, leaving many health care works who came to the UK to work, without jobs.”

André explains that any compliance visit by UKVI , whether unannounced or pre-arranged, will involve UKVI officials carrying out checks with the main aim of establishing whether the licence holder is complying with their duties.

After a visit, UKVI can continue to monitor compliance.

Andre says: “It is vital to ensure that you as a licence holder are ready at all times for such a visit, to demonstrate that the business can or continue to be able to meet your sponsor duties.

“The consequences of failing a Home Office inspection can be severe.

“The business may be downgraded from an A rated licence to a B rating, and the licence holder will be given an action plan to comply with within a fixed time frame.

“The licence holder will have to pay a fee and will not be allowed to sponsor any new workers until complaint with the action plan and the A-rating is restored

“Other measures available to UKVI inspectors are suspending the licence altogether, meaning that the business is unable to have a Certificate of Sponsorship assigned during the suspension period, although current sponsored workers will not normally be affected.

“UKVI can also choose to revoke a sponsor licence, which for the licence-holding business means it will be unable to sponsor any more workers and any existing sponsored workers’ permission will normally be curtailed.”

On their visit, a UKVI inspector will want to check:

• Evidence of human resource and recruitment systems.
• Proof that right to work checks were done properly and the correct evidence retained.
• A review of all employment contracts for employees and their records of attendance, annual leave and absences.
• Checks of whether there is a job description, a need for a vacancy and whether the worker has the professional qualifications for the role.
• Request a recent business bank statement to demonstrate genuine business activity and any recent transactions, as well as evidence of salaries paid to employees.
• Access to the site of any third party with which the business works; UKVI will expect full cooperation from such a third party.
• Consider the type of work and why the sponsored worker needs to in the UK if a worker is not working from a physical business premises.
• Interview the Authorising Officer, any relevant personnel and any sponsored workers, who must cooperate and be available.