· 2 min read · Features

Byron Hamburgers: what it means for other businesses

Published:

What should businesses make of stricter illegal working penalties and increasing Home Office audits?

On 28 July a training meeting for Byron Hamburger staff was raided by the Home Office. This led to 35 employees being taken away for not having permission to legally work in the UK. The hospitality industry has long been acknowledged as susceptible to illegal working, partly because of the high staff turnover as well as the low skill level and pay for many roles.

What happened?

The raid was believed to be orchestrated with the agreement of Byron's management. It is assumed this was so the company could avoid a civil penalty, which (in light of the number of workers involved) may have been in the region of £700,000. Following the introduction of the Immigration Act 2016 and the lower threshold applied to illegal working ('having reasonable cause to believe' rather than 'knowing' that someone did not have the right to work lawfully in the UK) the management's action may also have avoided criminal charges.

Was this a sensible decision?

While a company may have little option but to co-operate with the Home Office, businesses should not underestimate the negative ramifications of assisting with a raid. In Byron's case, shortly after the event #BoycottByron began trending on social media. This campaign was a response by some customers who were concerned that the company arranged a training session purposely to 'catch out' workers – not all of whom were working in the UK illegally.

Regardless of your personal view, alienating a proportion of your customer base can significantly damage a company's brand, reputation and profit long after a raid. In this new climate of stricter penalties and increasing Home Office audits businesses will need to balance the consequences of working with the Home Office against protecting their brand.

Such decisions can also have consequences for an organisation's contractual relationship with its business counterparts and its standing with regulators who may determine future visa applications. Ensuring that you have briefed your press team, and that they can assist with any necessary messaging, will be critical.

Looking to the future

The Home Office's decision to raid Byron Hamburgers can only increase concern for businesses who are already considering how to manage their staffing needs post-Brexit. It will be of particular interest to employers in industries at higher risk of illegal working such as hotels, construction companies and care homes. Such industries' workforces traditionally comprise of a large proportion of EU nationals who are unlikely to meet the future skills test set by the Home Office under immigration rules.

This high-profile audit is unlikely to be a one-off. It shows that while the right to free movement for EU nationals remains a key political issue the Home Office is likely to increasingly rely on the civil penalty regime to target companies employing people illegally.

The raid shows that when it comes to ensuring legitimate migrants take jobs the Home Office means business. This is clear in the increase in the number of civil penalties. For example, from July to December 2015 more than 1,200 penalties were issued with a value of £21.5 million.

In these uncertain times it's important for organisations to take their employees' right to work seriously and to review, audit and where necessary update their staff training practices. 'Tip-offs' that give rise to investigations and penalties are increasing, and businesses risk consumer campaigns against non-compliant practice, which can be just as damaging.

Vikki Wiberg is senior counsel in the employment, pensions and mobility team at Taylor Wessing