The EC targets employers of illegal workers with new rules to ensure similar penalties across all EU member states

The European Commission is proposing new rules targeting employers of illegal immigrants and ensuring similar penalties across all member states. Sanctions include fines, repayment of outstanding wages, taxes and social security contributions, and the possible loss of subsidies and disqualification from public contracts for up to five years. These would not apply to companies that could demonstrate that they had met checking and notification requirements when recruiting.

Criminal penalties are also proposed in ‘serious cases’, for example where at least four illegal immigrants are employed or where working conditions are particularly exploitative. Currently, just 19 of the 27 EU countries provide for criminal sanctions.

UK law already requires companies to check potential employees’ documents. Christopher Syder, associate partner, Davies Arnold Cooper, says that the

Immigration, Asylum and Nationality Act 2006 will impose two new penalties for employing illegal workers:

• A civil penalty of up to £2,000 for employing an illegal worker

• A criminal offence of knowingly employing an illegal worker, which would render an employer liable to a custodial sentence of up to two years and/or an unlimited fine.

Much of the Act came into force during 2006. However these two provisions are not yet in force, and full implementation of the Act not expected until 2008.

Syder also warns that companies employing temporary staff through an agency would be well advised to ensure that the agency is contractually bound to carry out the required immigration checks in advance of a placement and seek a full indemnity against any liability arising from failure to do so. “Further, the company should contract with the agency on the basis it does not employ the temps.”