HR Update - A cautionary tale from a Chip Shop

The True Cost of Getting Right to Work Checks Wrong

In July 2025, a fish and chip shop owner was left in “total shock” after being hit with a £40,000 civil penalty for allegedly hiring someone without the correct right to work documentation.

Despite believing they had done everything properly; the business owner now faces life-changing financial consequences. This story, originally reported in People Management, should act as a stark warning to all employers - especially small businesses - about the importance of correctly following the legal process for right to work checks.

What went wrong? A closer look at the chip shop case

In this case, the employer said they had obtained and retained what appeared to be valid documents from the worker. However, those documents were later found to be fraudulent. Despite the employer's insistence that they had acted in good faith, a civil penalty was issued - reportedly totalling £40,000, with an offer to reduce it to £28,000 if paid promptly.

The Home Office did not accept that the employer had conducted the appropriate checks to establish a statutory excuse, meaning they could not defend themselves against liability. This outcome highlights a crucial point: good intentions are not enough. Employers must ensure that:

• The documents provided are genuine

• They belong to the person presenting them

• The check is clearly recorded and retained

Without this, even a seemingly innocent oversight can lead to devastating consequences.

The wider crackdown: More than just a one-off

This incident is far from unique. Between July 2024 and May 2025, there was a 51% increase in immigration enforcement activity by the Home Office, with a sharp rise in both workplace visits and arrests.

In the first quarter of 2025 alone:

• 748 civil penalty notices were issued

• £41.6 million in fines were levied

This compares with 489 penalties and £29.2 million in fines in the previous quarter, showing a clear and ongoing Government commitment to crack down on illegal working.

Increased penalties in 2024: Up to £60,000 per worker

From 13 February 2024, the Government increased civil penalties for employing illegal workers:

• £45,000 per worker for a first breach

• £60,000 per worker for repeat offences

These amounts apply per illegal worker, and are now the default starting points - only reduced where mitigating factors apply (e.g. prompt payment, cooperation, or evidence of partial compliance).

In the fish and chip shop case, the £40,000 fine likely reflects a reduced amount offered in light of cooperation or early settlement. However, the risk of the full penalty - or even multiple fines for several workers - is very real, particularly for businesses unaware of their full responsibilities.

Your Legal Duty as an Employer

Every UK employer has a legal obligation to prevent illegal working. This applies regardless of business size or sector. Failing to comply can result in:

• Civil penalties as outlined above

• Criminal prosecution (in cases of knowingly employing someone illegally)

• Disqualification from acting as a company director

• Damage to reputation, including public naming

• In extreme cases, business closure

The Statutory Excuse: your legal defence - but only if done properly

The statutory excuse is your only legal defence if you later discover that someone you employed didn’t have the right to work in the UK. But it only applies if you carried out the correct checks, at the right time, and retained the proper records.

To rely on it, employers must:

• Conduct right to work checks before employment begins

• Verify that documents are valid, genuine and belong to the person presenting them

• Date-stamp and securely retain the records for the full period of employment and two years afterwards

If these steps are not taken, the statutory excuse cannot be relied upon - and penalties will follow, even if you had no knowledge of the worker’s status.

Three ways to check right to work

Employers can check a person’s right to work using one of three recognised methods:

1. Manual checks – For those presenting physical documents (e.g. passports, birth certificates), including British and Irish citizens. Originals must be inspected and copied with dates.

2. Online checks – For foreign nationals who provide a Home Office share code. These must be verified on the government’s online system, with a screenshot and check date saved.

3. Digital checks – For British and Irish citizens via an Identity Service Provider (IDSP) using Identity Document Validation Technology (IDVT). This remote method still requires the employer to review the outcome and retain appropriate records.

Each method has its own detailed rules - and they must be followed precisely to be valid.

Final thoughts: Don’t let a mistake cost you your business

The chip shop case is a powerful reminder that compliance with right to work laws is not optional, and that honest mistakes or assumptions won’t protect you.

With fines of up to £60,000 per worker, the risks are simply too high. The statutory excuse offers real protection - but only if the correct process is followed and records are watertight. It’s no longer enough to just take someone’s word for it or copy a passport without further scrutiny.

Now is the time to review your processes, train your Managers not to have staff actually working until after these key checks are done, and ensure that every check is documented correctly. The cost of getting it wrong is simply too high to ignore.

The guidance provided in this article is just that - guidance. Before taking any action, make sure that you know what you are doing, or call an expert for specific advice