A fundamental principle of the prevention of illegal working system is that employers must verify the right to work of individuals they employ, ensuring they hold the necessary visa status to allow employment in the UK. Failure to conduct these checks can now result in a civil penalty of up to £60,000 per worker. Historically, right to work guidance has been explicit that employers are only required to check the visa status of employees. However, a recent Home Office announcement indicates that these checks will soon extend to certain self-employed workers.
This shift in approach was first signalled last year when the Home Office updated their right to work guidance to highlight ‘compelling reasons’ why employers should verify the right to work of their self-employed workers, including:
- Avoiding business disruption and reputational damage caused by illegal workers
- Mitigating health, safety, and safeguarding risks linked to unverified qualifications and skill levels
- Aligning with international best practice standards and audit requirements
The revised guidance ‘strongly encouraged’ employers to confirm the right to work status of contractors and ensure that labour providers conducted appropriate checks on their workers. However, as there was no legal mandate, the responsibility to implement these measures remained at employers’ discretion.
New legal obligations
The Government has now taken a firmer stance. In late March, it announced that employers will be legally required to conduct right to work checks for specific categories of self-employed workers. As part of efforts to ‘restore order’ to the immigration system and curb illegal employment, companies hiring gig economy and zero-hours workers will soon have to verify their legal work status in the UK.
Under these measures, the civil penalty regime which applies to employees will be extended to these workers. If an individual is found to lack the appropriate visa permission, the employing company could face substantial fines, business closures, or, in serious cases, criminal prosecution.
Unanswered questions
While the announcement sets out a clear direction, several details remain uncertain:
- Implementation Timeline: The commencement date of these changes is not yet confirmed. Reports indicate that legislation will be introduced in Parliament later this year, providing a window for preparation
- Scope of the definition of ‘Gig Economy’ Workers: The legal distinction between employees, workers, and self-employed contractors is complex, raising questions about which individuals will fall within the new requirements
- Retrospective Application: It is unclear whether existing self-employed workers will need to undergo right to work checks or if the requirement will only apply to new engagements once the changes take effect
Increased compliance burden
These reforms will increase the compliance burden on employers, who already shoulder significant responsibility enforcing immigration controls on behalf of the Home Office. Larger businesses with established HR infrastructure may be better placed to adapt, but SMEs may struggle to cope with the added administrative load. The financial penalties for non-compliance are costly, potentially threatening the viability of smaller businesses.
A recent survey indicated that smaller companies, particularly those employing agency or zero-hours workers, are at a higher risk of making errors in right to work checks due to their limited knowledge of the regulatory framework. Alarmingly, nearly 40% of surveyed employers were unaware of any recent changes to right to work requirements. The Home Office must improve its communication strategy when it comes to right to work reforms and provide clearer guidance to support businesses to navigate these changes.
Preparing for the changes
Employers still have time to adapt. Businesses should assess how these changes will impact their operations and whether their current right to work checking processes can accommodate the increased requirements. Internal audits, staff training, and updated policies will be essential to ensure compliance. Clear communication with workers regarding the new obligations will also be crucial.
These developments reflect the Government’s intensified focus on enforcement and compliance, which has seen an increase in visits and fines. Employers must take proactive steps to align with the evolving regulatory landscape, as the consequences of non-compliance are increasingly severe.
We will be discussing this and other immigration law developments in our latest webinar 'Navigating the latest Immigration Law Changes: Essential Updates for HR Professionals' taking place on 15th May 2025. Please sign up here!
