PENALTY POINTS

What is the civil penalty scheme?

The civil penalty scheme states that if you are found employing illegal migrant workers after 28 February 2008, you will initially be served with a Notification of Potential Liability.

Depending on the evidence amassed by the immigration team that visited your workplace, you may then be issued with a Notification of Liability and may have to pay a fine of up to £10,000 for each illegal worker. You must pay the fine within 28 days, or if you object to it, lodge your objection within 28 days.

The penalty system operates on a sliding scale of amounts, based on the type of eligibility checks you have made on your workers, the number of occasions on which a warning has been issued or civil penalty imposed, and the extent to which you co-operated with the Border Agency.

Under the new points based system also introduced earlier in the year, you may be prevented from registering as a sponsor employer of migrant workers. Alternatively, you may be downgraded or struck off altogether as a licensed sponsor, which will limit who you can employ in the future.

The Border Agency has also started to publish a roll call of employers on its website whom it has found liable for payment of a civil penalty.

Is there also a criminal offence?

The new penalty scheme sits alongside a new criminal offence of "knowingly employing" an illegal migrant worker. This will be used in more serious cases including rogue employers who knowingly and deliberately use illegal migrant workers, often for personal financial gain. This will carry a maximum two year custodial sentence and/or an unlimited fine.

What is a statutory excuse?

It is in your interest to make sure that the migrant workers you employ are eligible to work in the UK. Checking the documents of prospective employees before you hire them provides you with what is known as a "statutory excuse", which may prevent you from having to pay a civil penalty.

For workers with a time limit on how long they can stay in the UK, you must repeat the document checks at least once a year to retain the excuse.

What documentation do you need to check?

As an employer you may be presented with documents, from one of two lists established by the Border and Immigration Agency. Documents from List A establish that the person has an ongoing entitlement to work in the UK, documents from List B indicate that the applicant or employee has restrictions on their entitlement to be in the UK (full details of the required documents are listed at the end of this article).

To make sure the documents are valid, you should check the likeness of the photograph against the person in front of you; check the date of birth is consistent with their appearance; check that the document has not expired; and that there are no endorsements on it saying the person is not allowed to do the work you are offering.

When you have checked the person’s documents and are satisfied that they are genuine, you must save and store them securely to ensure that the information cannot be altered, deleted or overwritten.

Is this very different to what you had to do before 1 February?

The documents are quite similar to ones you would have checked under the previous law. To make life easier for employers, the Government says it is developing secure identity cards for foreign nationals to simplify the list of specified documents you can accept and progressively replace paper-based documents with secure cards as these are rolled out.

How does the Race Relations Act fit in?

Under the Race Relations Act, it is illegal to discriminate on grounds of race, colour, ethnic or national origin or nationality. The best way to ensure that you do not discriminate is to treat all applicants the same way at each stage of the recruitment process. In other words, you should carry out document checks on all prospective employees and not make assumptions about a person’s right to work in the UK based on their background, appearance or accent.

What can you do to ensure you abide by the law?

Given the complexity of the law, you should always:

• Examine carefully the documentation required by the Government before you offer someone a job
• Make sure you remember to carry out further checks on any employees who provide documents from list B at least once a year
• Use the UK Border Agency Employer Checking Service when required (www.bia.homeoffice.gov.uk/employers/employersupport/ecs/)
• Provide training for all managers and HR advisers
• Ask all prospective employees the same questions

LIST A

1. A passport showing that the holder is a British/UK citizen or a citizen who has the right of abode here
2. A passport or national identity card showing that the holder is a national of the European Economic Area (EEA) or Switzerland
3. A document indicating permanent residence issued by the Home Office or the Border and Immigration Agency (BIA) to an EEA national or someone from Switzerland.
4. A permanent residence card issued by the Home Office or the BIA to the family member of an EEA national or someone from Switzerland
5. A Biometric Immigration Document issued by the BIA giving indefinite right to stay
6. A passport or other travel document endorsed to show that the holder is exempt from immigration control, is allowed to stay here indefinitely, has the right of abode here or has no time limit on their stay in the UK
7. An Immigration Status Document issued by the Home Office or the BIA with an endorsement indicating that the person is allowed to stay indefinitely in the UK or has no time limit on their stay, when produced in combination with an official document giving the person’s permanent National Insurance (NI) number and their name, issued by a Government agency or a previous employer.
8. A full birth certificate issued in the UK which includes the name(s) of at least one of the holder’s parents, when produced in combination with an official document giving the person’s permanent NI number and their name issued by a Government agency or a previous employer
9. A full adoption certificate issued in the UK which includes the name(s) of at least one of the holder’s adoptive parents when produced in combination with an official document giving the person’s permanent NI number and their name, issued by a Government agency or a previous employer
10. A birth or adoption certificate issued in the Channel Islands, the Isle of Man or Ireland, when produced in combination with an official document giving the person’s permanent NI number and their name issued by a Government agency or a previous employer
11. A certificate of registration or naturalisation as a British citizen, when produced in combination with an official document giving the person’s permanent NI number and their name issued by a Government agency or a previous employer
12. A letter issued by the Home Office or the BIA which indicates that the person named in it is allowed to stay indefinitely in the UK, when produced in combination with an official document giving the person’s permanent NI number and their name issued by a Government agency or a previous employer

LIST B

1. A passport or travel document endorsed to show that the holder is allowed to stay in the UK and is allowed to do the type of work in question, provided that it does not require a work permit
2. A Biometric Immigration Document issued by the Border and Immigration Agency (BIA) which indicates that the person named in it can stay in the UK and is allowed to do the work in question
3. A work permit or other approval to take employment issued by the Home Office or the BIA when produced in combination with either a passport or another travel document endorsed to show the holder is allowed to stay in the UK and is allowed to do the work in question, or a letter issued by the Home Office or the BIA to the holder or the employer or prospective employer confirming the same
4. A certificate of application issued by the Home Office or the BIA to or for a family member of a national of an EEA country or Switzerland stating that the holder is permitted to take employment which is less than 6 months old when produced in combination with evidence of verification by the BIA Employer Checking Service.
5. A residence card or document issued by the Home Office or the BIA to a family member of a national of a EEA country or Switzerland.
6. An Application Registration Card issued by the Home Office or the BIA stating that the holder is permitted to take employment, when produced in combination with evidence of verification by the BIA Employer Checking Service.
7. An Immigration Status Document issued by the Home Office or the BIA with an endorsement indicating that the person named in it can stay in the UK, and is allowed to do the type of work in question, when produced in combination with an official document giving the person’s permanent NI number and their name issued by a Government agency or a previous employer
8. A letter issued by the Home Office or the BIA to the holder or the employer or prospective employer, which indicates that the person named in it can stay in the UK and is allowed to do the work in question when produced in combination with an official document giving the person’s permanent NI number and their name issued by a Government agency or a previous employer.

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TIMELY TRANSFER

What happened?

Mr Coutinho was made redundant from his job on 30 March 2004. He lodged a tribunal claim on 30 June, alleging unfair dismissal and race discrimination against Vision Information Services (VIS). At the end of July 2004, VIS was transferred to Rank Nemo Ltd and it was added to the claim in November 2005.

In April 2005 Mr Coutinho asked VIS for a reference (copied to Rank Nemo) and finally got one in June 2006. He then lodged a victimization claim against both companies on the basis that the duty not to victimize him by failing to provide a proper reference had transferred to Rank Nemo under TUPE.

The employment tribunal upheld Mr Coutinho’s complaint of unfair dismissal. It found that he had been dismissed for a reason related to the transfer which made it automatically unfair. However, with regard to the reference, the tribunal said that VIS could not be held liable for victimisation in July 2004 as that liability could only have arisen when it was actually provided in August 2006. Nor was Rank Nemo liable as Mr Coutinho had not actually asked the company to provide him with a reference.

The EAT upheld the tribunal’s decision. It said that copying Rank Nemo into his request for a reference could not justify a claim of victimisation as he had never actually asked them for one. And as Mr Coutinho had never been employed by Rank Nemo, the duty not to victimize him did not shift from VIS.

Nor could the duty to provide a reference "become the responsibility of the TUPE transferee simply by virtue of the transfer". As the transfer had taken place in July 2004 and the request for the reference was made in April 2005, no duty had transferred as the request had not been made before the transfer.

The EAT said that it would be absurd for a transferee to be liable in a situation "where as here an employee has not actually transferred his employment and, for example, may require the transferor to provide a reference many years after his employment has come to an end". That would place an impossible burden on the transferee and the EAT therefore dismissed the appeal.

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REDUNDANT ARGUMENT

What happened?

In 2005 the Co-op terminated the contracts of all its financial advisors due to huge operating losses. It then offered them new contracts including a new payment system, more rigorous performance management and an end to the old system of collecting members’ dues.

Some advisors claimed that they had been made redundant and were therefore entitled to redundancy payments because their jobs had changed so significantly.

The tribunal said that the question to resolve was whether the advisors were being asked "to carry out work of a particular kind which was different to the work they had performed under their existing contracts".

It decided that that although the advisors’ jobs had changed significantly, they were still essentially employed as "salesmen" with their pay based on commission from products they sold to customers. Although the company was introducing additional channels for selling and the advisors would be required to be more aggressive in their selling, it was still in reality the same work, but carried out in a different way.

In the view of the tribunal, the changes therefore represented a reorganisation of the salesforce by the Co-op, not a redundancy situation and the advisors had therefore been dismissed "for some other substantial reason".

The EAT agreed. It said that the tribunal had looked (correctly) at what the claimants did in reality and not what their contracts said when deciding whether they were no longer being required to carry out work "of a certain kind". Although the tribunal made the observation that the changes were required for sound commercial reasons, the EAT did not think it had been swayed by this factor when coming to their decision.

It did not consider that the tribunal’s decision was perverse, even though it had made clear in its judgment that the jobs of the advisors had changed significantly. This, said the EAT, was a question of fact and it was therefore up to the tribunal "to consider whether the change in the nature and quality of the tasks and the way in which they were being carried out is sufficient to justify an inference that the work could now be described as being of a different kind or not."

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IN BRIEF

The report, "Talent not Tokenism", shows that promoting diversity need not be expensive, complex or a legal minefield for business. And it identifies some key ingredients for bringing about change, including leadership from senior management and employee involvement, especially through unions and other workforce representatives.

It also makes clear that diversity can be improved through positive action - such as removing bias against older workers, developing strong links with local communities and offering flexible shift patterns to help working parents.

The case studies in the report illustrate how companies, from small family-run firms to multinationals like IBM and GSK, have improved their workplace diversity and the advantages in doing so. The report also contains tips and advice from senior executives at 10 leading companies, including BT, Barclays, Shell and PricewaterhouseCoopers.

To download a copy, go to: www.tuc.org.uk/extras/talentnottokenism.pdf

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