On 1 October the scope of the right to work checks was substantially expanded. As a result, a greater number of working relationships are required to comply with the right to work checks. Businesses that use agencies, labour providers, subcontractors or other outsourced labour arrangements must now ensure that appropriate contractual protections and compliance controls are in place throughout the contractual chain.
For farmers and rural businesses this is unlikely to affect the way that they carry out right to work checks on their own employees. However, many agricultural and rural businesses rely on seasonal workers, agency labour, contractors or farm consultants and it is these kinds of labour supply arrangements that may now be within the scope of right to work checks.
What has changed?
The new Code of Practice introduced an “extended liability” regime in specific contractual arrangements. These provisions apply where:
- a business contracts to provide work or services to a third party and engages another employer to provide workers to deliver those services
- an online matching platform connects service providers with customers
- an individual is engaged under a contract that permits them to send a substitute to perform the work
Furthermore, if an employer with a direct contractual relationship with an employee cannot be identified, or prescribed compliance requirements have not been met, liability may extend to another party higher up the contractual chain.
What are the risks?
Failing to comply is serious. Employers found to be employing someone illegally can face fines of up to £60,000 per illegal worker. If an employer knows they are employing an illegal worker, they will commit a criminal offence.
The new compliance requirements
To establish a statutory excuse against extended liability, businesses within the contractual chain must be able to demonstrate compliance with a series of prescribed requirements.
For prevention, measures include written contractual terms requiring right to work checks to be carried out, restrictions on further subcontracting without consent and identity verification processes.
Where illegal working is identified, compliance measures include sufficient enforcement mechanisms and cooperation with Home Office investigations.
Importantly, businesses must retain evidence that these arrangements have been implemented and operated in practice. A person seeking to rely on a statutory excuse must be able to evidence compliance with the prescribed requirements.
What should employers do?
The key challenges facing businesses, will firstly be managing the labour supply chain risk and secondly, be establishing when the new rules apply. Ensuring oversight of all employment processes and procedures and maintaining up to date policies, procedures, records and training will be key.
Where employers are not sure if certain labour contracts will attract compliance, they should seek legal advice without delay.