Expanded Illegal Working Liability Under the Border Security, Asylum and Immigration Act 2025

The Current Illegal Working Liability Framework in the UK

Employer Obligations

All UK employers must prevent illegal working. This is achieved by conducting compliant right to work checks before employment begins. Failure to conduct proper checks may result in:

• Civil penalties
• Criminal liability where illegal employment is known or deliberate
• Sponsor licence revocation

The statutory excuse protection remains dependent on conducting prescribed checks correctly and retaining compliant records.

The Existing Gap in the Framework

• Under the current regime, the obligation applies to employees.

• It does not extend clearly to: 
  • Gig-economy workers
  • Zero-hours contract workers
  • Certain contractors or non-traditional working arrangements
    

• Where labour is supplied by a third party, responsibility for right to work checks typically rests with the labour supplier rather than the end user.

This distinction is now being fundamentally reconsidered.

Expansion of Illegal Working Liability: Key Changes Under Section 48 (Not Yet in Force)

1. Right to Work Checks Will Apply to All Workers

• Contractors and sub-contractors

• Gig-economy workers

• Zero-hours workers

• Individuals engaged under non-traditional arrangements

• Workers engaged directly or indirectly

Impact: Employment status will no longer determine whether checks are required.

This represents a structural expansion of illegal working liability UK enforcement. 

2. Introduction of Supply Chain Liability 

One significant change under the Border Security, Asylum and Immigration Act 2025 is the introduction of supply chain liability. Under Section 48:

• Any business involved in the engagement of a worker may be treated as the “employer”

• Liability can arise without a direct contractual relationship

• Multiple businesses may be liable for the same illegal worker

• Liability may extend throughout the supply chain

This represents a fundamental shift in risk allocation.

Current Illegal Working Penalties in the UK

The penalties for illegal working remain severe and are central to the enforcement regime. Failure to conduct compliant checks may result in:

• £45,000 per illegal worker for a first offence

• £60,000 per illegal worker for repeat offences

• Criminal sanctions for knowingly employing an illegal worker, including up to five years’ imprisonment

• Sponsor licence revocation

• Director disqualification

• Business closure

For sponsor licence holders, the commercial impact could be severe.

Sector Impact: Who Is Most at Risk?

The expansion of illegal working liability UK provisions will particularly affect Retail, Hospitality, Food & Beverage and Construction businesses.

These sectors are particularly exposed due to:

• High reliance on flexible labour
• Seasonal workforce demands
• Agency engagement
• Subcontracting models

High-turnover environments (e.g. restaurants, cafés, retail stores) may face

• Increased administrative burden
• Higher compliance costs
• Greater exposure to financial penalties

Flexible Workforce Implications

Businesses commonly engage:

• Zero-hours workers
• Students
• Seasonal and holiday staff
• Temporary and agency workers

Under the expanded regime:

• Every individual must have their right to work checked
• Checks must be conducted on or before the first day of work
• Nationality is irrelevant. Checks apply to British and foreign nationals alike

Supply Chain Risk Exposure

Businesses outsourcing services such as:

• Cleaning
• Security
• Delivery
• Temporary staffing

Will face expanded risk:

• Liability may arise even without direct engagement.
• Both main contractors and sub-contractors may be penalised.
• Due diligence on supply chain partners will become critical.

Heightened UKVI Enforcement Activity

The Home Office has already intensified enforcement in sectors including:

• Hospitality
• Food delivery
• Retail
• Construction
• Care homes

Businesses can expect:

• Increased UKVI inspections
• Greater scrutiny of compliance systems
• Enhanced focus on sponsor licence holders resulting in sponsor licence audits

Loss of a sponsor licence could significantly restrict workforce planning and recruitment.

Implementation Timeline: When Will Section 48 Take Effect?

The Border Security, Asylum and Immigration Act 2025 received Royal Assent in December 2025. However:

• Section 48 is not yet in force
• No commencement date has been confirmed

Despite the absence of a confirmed implementation date, preparation should begin now.

Recommended Next Steps for UK Businesses

To mitigate future illegal working liability risk, businesses should:

1. Audit Existing Right to Work Processes

• Ensure full compliance with current statutory requirements and confirm that records provide statutory excuse protection.

2. Improve Onboarding Procedures

• Update onboarding processes to cover all workers, regardless of status.
• Embed right to work checks as a universal pre-engagement requirement regardless of employment status.

3. Review Supply Chain Arrangements

• Review contracts with agencies, contractors and subcontractors.
• Insert clear compliance obligations
• Require documentary evidence of right to work checks
• Consider indemnities and audit rights

4. Utilise Digital Verification Tools

Approved systems include:

• The Home Office online right to work checking service
• Identity Document Validation Technology (IDVT) providers. Note this can only be used for UK and Irish citizens.

5. Strengthen Training and Record Keeping

• Train HR teams and hiring managers
• Maintain clear audit trails
• Ensure documents retained evidence statutory excuse protection.

Strategic Considerations

• Reassess reliance on contingent workforce models.
• Map supply chains to identify compliance gaps.
• Consider governance-level oversight of illegal working risk.
• Prepare for potential cost increases associated with enhanced compliance.

Conclusion: Preparing for Expanded Illegal Working Liability

The Border Security, Asylum and Immigration Act 2025 represents a major expansion of illegal working liability, particularly through:

• Extension of checks to all workers
• Introduction of supply chain liability
• Significantly increased financial and criminal penalties.

Although Section 48 is not yet in force, businesses, particularly those operating in retail, consumer, food and beverage, and construction sectors, should act now to strengthen systems, mitigate risk, and ensure readiness for implementation. 

Frequently Asked Questions

Question: What is Section 48 of the Border Security Act 2025?
Answer: Section 48 expands illegal working liability beyond employees to contractors and indirect workers.

Question: Does illegal working liability apply to contractors?
Answer: Under the proposed framework, yes.

Question: When will Section 48 come into force?
Answer: A commencement date has not yet been announced.