Case update (2): Illegal working – dismissal without certainty…

Summary: Is an employer’s genuine and reasonable belief that an employee was no longer permitted to work in the UK sufficient to show that a subsequent dismissal was both substantively and procedurally fair?

Yes, says the EAT in Nayak v Royal Mail Ltd available here.

Background:  It is unlawful to employ an individual who does not have the right to work in the UK or who is working in breach of their conditions of stay in the UK.

These illegal workers may be fairly dismissed on the basis of a statutory restriction where an employer has actual knowledge that continued employment would breach a statutory enactment.

However, in this case, the EAT considered whether the Tribunal was correct to conclude that an employer had fairly dismissed an employee on grounds of their immigration status, when it did not actually know that the employee was working illegally.  Instead of relying on the statutory restriction for dismissal, the employer dismissed the employee for Some Other Substantial Reason (SOSR).

It is also worth noting the different regimes in respect of illegal working, depending on when employment commenced. The following are relevant for the purposes of this case update:

• Pre-29 February 2008: it was an offence to employ someone who had not been granted leave to enter or remain in the UK or whose leave was not valid or subsisting or was subject to conditions preventing them from taking up employment. An employer had a statutory defence if, before the employment began, it had checked that the potential employee had certain documents and retained copies on file.
• 29 February 2008 to 15 May 2014: for employees with limited leave to remain, under a code of practice issued in February 2008, an employer had to repeat document checks every 12 months until such time as the individual no longer had a limit on the duration of their stay.
• Current:  Where an employee makes an application for continued leave to remain prior to the expiry of their current visa, then they will continue to have the right to remain in the UK under the terms of the old visa once it expires, provided that the application has not been decided, withdrawn and/or an appeal remains outstanding in respect of a refusal.

Facts: Mr Nayak was employed by Royal Mail Group Ltd (Royal Mail) between 7 January 2008 and 9 May 2014, when his employment was terminated because Royal Mail believed that he no longer had the right to work in the UK.

A summary of Mr Nayak’s visa arrangements is as follows:

• On commencement of employment, Mr Nayak held a visa that subsequently expired on 15 April 2009;
• He was subsequently granted a Tier 1 (Post-study) visa that expired on 1 December 2010; and
• Prior to expiry of the post-study visa, Mr Nayak applied for a Tier 4 (General) student migrant visa. His application was initially refused, but following a successful appeal to the Immigration Tribunal on 27 May 2011, his application passed to the Home Office for consideration and processing.

In March 2012 Royal Mail sought confirmation from the Home Office regarding Mr Nayak’s right to work in the UK. The Home Office confirmed that he had the right to work in the UK ‘on the basis of an outstanding appeal’.  In August 2012, January 2013 and February 2013 Royal Mail wrote to Mr Nayak asking him to provide updated proof of his right to work in the UK. He did not respond. In May 2013 Royal Mail wrote again to the Home Office. They confirmed that, because Mr Nayak had commenced employment before 29 February 2008 (when the rules changed), no further checks were required as long as document checks had been carried out at the start of his employment and copies of the original documents checked by Royal Mail remained on file. Royal Mail had not done this.

Between December 2013 and May 2014 Royal Mail made further enquiries of Mr Nayak to try to establish his immigration status. He was told that the right to work could only last while his application for his Tier 4 visa remained outstanding. As his application for a new visa had been made over four years earlier, it was not safe to assume that it was still pending.

Mr Nayak was warned that a failure to provide evidence of his immigration status could result in his dismissal. He failed to produce satisfactory documentation and was dismissed.

Mr Nayak appealed and was given additional time to prove his status. Royal Mail suggested that he make a data subject access request to the Home Office seeking confirmation of his status, which he failed to do. The decision to dismiss him was upheld.

Mr Nayak brought a Tribunal claim for unfair dismissal. Royal Mail defended the claim on the basis that it was a fair dismissal for Some Other Substantial Reason (SOSR).  The Tribunal dismissed Mr Nayak’s claim and held that there was sufficient evidence to conclude that a reasonable employer would not be satisfied that Mr Nayak’s visa application remained pending. Nr Nayak appealed to the EAT which upheld the Tribunal’s decision and dismissed the appeal.

The EAT agreed with the Tribunal that Royal Mail had genuine and reasonable belief that Mr Nayak no longer had the right to work in the UK and that his dismissal was both substantively and procedurally fair and SOSR was a fair reason for dismissal.

The EAT considered there was sufficient evidence to show Royal Mail’s attempts to establish Mr Nayak’s immigration status over a period of several years and his persistent failure to co-operate.  Royal Mail had taken reasonable steps to investigate the position and its admitted failure to carry out the initial document check had no bearing on the fairness of the dismissal. Royal Mail could not be expected to wait indefinitely and the timeframe given to Mr Nayak in which to respond was reasonable.

Implications:  The case demonstrates that a SOSR dismissal may be fair where an employer has a reasonable and genuine belief that the employee no longer had the right to work in the UK, whether that belief turns out to be correct or not. This may prove useful to employers where, as in this case, there is insufficient evidence to allow the employer to dismiss by relying on breach of a statutory restriction.

In order to have the best chance of relying on SOSR, employers should maintain their immigration and right to work policies and ensure that they are up to date, effective and properly utilised.

However, employers should still act with caution before dismissing.  This is in light of the fact that the Home Office usually expects employers in these circumstances to use the Employer Checking Service, rather than, as in this case, imposing an expectation that a migrant worker should instead produce different evidence of his right to work and then dismiss him for not complying.