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The Immigration Act 2016 and why it’s not JUST about immigration!

Here’s a simple overview of some of the provisions of most interest to employers and recruiters for starters

The Immigration Act 2016 (the Act) is now “law”; but not all of its provisions are in force; and not all of it concerns immigration.

The Act introduces new sanctions on illegal working and includes measures intended to: prevent illegal migrants from accessing services and holding certain licenses (taxi/private hire/sale of alcohol); enforce immigration laws; charge employers for recruiting from outside the European Economic Area (EEA); introduce a language fluency requirement for certain public sector employees; create a new Director of Labour Market Enforcement; and expand the remit of the Gangmasters Licensing Authority (GLA), amongst other things!

Here’s a simple overview of some of the provisions of most interest to employers and recruiters for starters:

Employment provisions in a nutshell

Three provisions relevant to employers came into force on 12 July 2016:

  • Sections 1-9, require the Secretary of State to appoint a Director of Labour Market Enforcement (more on this below);
  • Section 34, creates a new offence of illegal working where a person works at a time when he or she reasonably believes that he or she is disqualified from doing so because of his or her immigration status (i.e. worker offence). Existing legislation provided for worker offences already; the creation of an additional new one shows that this is an issue which Government wants to (be seen to) tackle;
  • Section 35, extends the existing criminal offence of knowingly employing an illegal worker to include a situation where the employer has ‘reasonable cause to believe’ the employee is disqualified from working because of his or her immigration status (i.e. employer offence). In addition, the maximum sentence for this offence has been increased.

The following sections are also of interest to employers:

  • Sections 10-13, rename the GLA and increase its powers (see more about this in the section on it below).
  • Section 27 creates a new offence, referred to (in the Government’s January 2016 response to its consultation on Tacking Exploitation in the Labour Market) as an ‘offence of aggravated breach of labour market legislation’. This will sit hand-in-hand with the new ‘labour market enforcement undertakings’ and ‘labour market enforcement orders’ (see below), providing a criminal offence for non-compliance with an order.
  • Section 77, requires a public authority to ensure that each person working in a customer-facing role speaks English fluently enough to do their job effectively. The Government has published a Code of Practice to which public authorities should have regard in meeting their so-called “fluency-duty”.
  • Section 85, inserts a provision into the Immigration Act 2014 to empower the Secretary of State to introduce (via regulations) an immigration skills charge (what some people refer to as a ‘visa levy’) on certain employers who sponsor skilled workers from outside of the EEA. The plan is for this to be charged to employers sponsoring Tier-2 workers at a rate £1000 per Tier-2 worker per year, with a reduced rate of £364 for small businesses, from April 2017.

Director of Labour Market Enforcement

A new post of Director of Labour Market Enforcement has been created to crack down on the serious exploitation of workers (the Director). Potential candidates have been shortlisted, with interviews for the position scheduled for early October.

The Director will be tasked with over-seeing and co-ordinating enforcement of worker exploitation legislation by the three main bodies which are already responsible for this:

  • The Gangmasters Licensing Authority (whose powers and name are to be extended, see discussion below);\
  • The Employment Agency Standards Inspectorate; and
  • The National Minimum Wage Enforcement Team in Her Majesty’s Revenue and Customs (HMRC).

We’ll collectively refer to these as ‘the enforcement bodies’.

The Director will be appointed by and will report to both the Home Secretary and the Secretary of State for business.

The Director’s primary functions will include:

  • Developing an annual labour market enforcement (LME) strategy, to be approved by the Secretary of State. This ‘LME Strategy’ will assess the scale and nature of non-compliance in the labour market in the previous year (i.e. look back) and will also contain a proposal for the current (i.e. the Strategy’s) year as to how labour market enforcement functions should be exercised, including what training, education and information will be needed for this (i.e. looking forwards). The enforcement bodies, and their officers, will have to have regard to the LME Strategy in exercising their functions.
  • Producing an annual report, including an assessment of the extent to which LME functions were exercised, the extent to which that year’s Strategy ‘worked’, and what activities the Director undertook.
  • Leading an intelligence hub to facilitate data-sharing between the enforcement bodies and use information drawn not only from them, but also ‘from beyond’ too (whatever that means!) to provide a ‘single view of risk and priorities across the spectrum of non-compliance’. Depending on how well the new directorate is resourced, this information-sharing power could well represent a shift towards big-brother-style enforcement.

The Gangmasters and Labour Abuse Authority

The GLA is to be renamed the Gangmasters and Labour Abuse Authority (GLAA) and its functions and powers are to be significantly broadened. The GLAA will begin operation under its new terms from 1 October 2016, i.e. this weekend!

Section 11 of and Schedule 2 to the Act give the GLAA additional functions and powers in relation to ‘labour market’ enforcement. The Employment Agencies Act 1973, the National Minimum Wage Act 1998 and the Modern Slavery Act 2015 are all amended so as to include the GLAA as an additional enforcement authority in relation to those Acts.

As the GLA explains on its website in respect of its additional remit (our emphasis):

‘… the new GLAA remit will be unlimited with officers able to look into allegations of labour abuse in all aspects of UK business’.

Section 12 of the Act empowers the Secretary of State to make regulations providing that any provision of the Police and Criminal Evidence Act 1984 (PACE) – which relates to investigations of offences conducted by police officers – will apply to ‘investigations of labour market offences conducted by labour abuse prevention officers.’

In the GLA’s words these additional powers: ‘will allow the organisation to investigate abuse allegations across the entire UK labour market.’

Labour abuse prevention officers are officers of the GLAA who are authorised to be such. The GLA explains on its current website that this ‘will be a specialist investigator role created within the GLAA. These will be officers specifically detailed to carry out enquiries into labour market abuse offences.’

Paragraph 16 at page 7 of the Government’s response to its consultation on tackling exploitation in the labour market (the Consultation Response), explained that the GLAA will also:

‘… retain the existing licensing regime, but this will be reformed to be more flexible and capable of responding to changing risk, subject to Ministerial decisions, on the advice of the Director of Labour Market Enforcement.”

As far as we are aware, there is no suggestion that a separate body (akin to the CPS) will bring prosecutions on behalf of the GLAA, meaning that the GLAA will presumably be licensor, investigator, and prosecutor. This is a worrying amount of power for one organisation – particularly given the new powers to require businesses to give undertakings based on only a reasonable belief that an offence is being/has been committed (see below).

New Offence, breach of labour market enforcement

As explained in the Consultation Response, the Act also introduces a new type of enforcement order supported by a criminal offence for non-compliance.

It gives an enforcement body (which will always include the GLAA, given the impact of the above changes), where it has a reasonable belief that a person has committed or is committing a labour market offence, power to require a business to enter into an undertaking.

The provisions outline what measures (prohibition, restriction, or requirement) the undertaking may include and for what purposes, but the categories are wide: particularly considering that:

  • Such an undertaking may have effect for up to 2 years;
  • If the business refuses to give the undertaking after a period of ‘negotiation’, or having given it, fails to comply with it, the enforcing authority may then apply for a labour market enforcement order against that person; and
  • If that person, without reasonable excuse then fails to comply with that order, they’ll commit a criminal offence, with the penalties for this including imprisonment.

Things for employers to think about

  • The lower burden of proof for the offence of knowingly employing an illegal worker is one to watch. From July it’s now easier for an employer to commit a crime because not only those who “knowingly” employ an illegal worker, but also those who have “reasonable cause to believe” that a person has no right to work, can commit the offence. The maximum penalty has also been raised from two to five years’ imprisonment.

Make sure that your recruitment checks are adequate and reliable and that the people who are carrying them out understand what’s at stake. Audit your employee files to ensure you have evidence of valid and up-to-date right to work documentation and make sure that you know, if applicable, exactly when any visas are due to expire.

  • The Act grants the Chief Immigration Officer the power to close a business premises for up to 48 hours in certain circumstances: another reason to ensure you carry out proper checks on all workers (or ensure that your recruitment agency has done so).
  • If you need to sponsor migrant workers under Tier 2, get ready for the additional financial burden that will result from the Immigration Skills Levy.
  • Be wary of the change announced in the last Budget whereby employers could lose the benefit of the Employment Allowance (i.e. up to £2k off their National Insurance bill) for a year if they’re subject to a civil penalty for employing illegal workers.

By HRC Law

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