May 2007 - Small Business News

Good news for honest businesses; the government is starting a new drive to stop the small minority of rogue employers from hiring illegal workers and paying below the minimum wage. 

The crackdown should help to prevent rogue businesses from being able to undercut honest businesses by breaking the law; and help to ensure a fair playing field for small businesses in the UK. They will mean changes to the checks you have to make when employing any workers.

The new rules will see rogue employers face a prison sentence and/or an unlimited fine if found knowingly employing illegal workers. Civil penalties will also be levied on companies which have been negligent in carrying out checks on workers. The level at which these fines will be set and how they will be imposed is now the subject of a consultation.

Some of the changes to employing workers will involve:

• Compulsory identity cards for foreign nationals - provisions in the UK Borders Bill require foreign nationals living in the UK from outside the EEA to apply for biometric ID helping tackle fraud, illegal working and multiple identities.
   
• An employee checking service - the first joint pilot between BIA and IPS, which is the next step in improving the support offered to employers.
   
• Sponsorship - introduced under the new Australian-style points based system for managing migration, which will ensure that employers take responsibility for whether their workers comply with the immigration rules.
   
• Penalties for rule breakers - the implementation of civil penalties for those employers who employ illegal migrants as a result of negligent recruitment and a new criminal offence for those found to be knowingly employing illegal workers.
   
• Tougher enforcement - through intelligence led enforcement, progressively blocking the benefits of Britain to illegal immigrants through partnerships across Government, with police and the private sector.
   
• Making sure people know the rules - through a national media and direct mail campaign on illegal working, reminding employers of their responsibilities.

“Firms who flout minimum wage regulations are providing unfair competition for the vast majority of employers who do not break the law and consequently have to charge higher rates.”  

More information on legislation and regulation issues is available from our Business Law portal.