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The Right to Work and Unfair Dismissal

When employing staff, employers must ensure that the prospective employee has the right to work in the UK.  If an individual is found to be working illegally, the employer may face a fine of up to £20,000, per employee.  Most British and EAA nationals have the right to work in the UK, which includes the UKCS, without having to obtain any additional permission from the Home Office.  However, the employer should still complete appropriate checks when hiring staff to ensure that the prospective employee has the right to work before making any offer of employment.  Thereafter, employers should periodically check the employee’s right to work in order to ensure that they do not fall foul of any illegal practices.  Where the employer reasonably believes that the employee has lost their right to work in the UK, for whatever reason, a fair termination of employment may be achieved on two possible grounds: 

  1. Due to a “statutory restriction” – where the employer concludes that continuing to engage the individual would breach a legal provision, or 
  2. “Some other substantial reason” – where the employer genuinely and reasonably believes that continuing to employ the individual may breach a statutory restriction. 

This test was considered in the recent case of Nayak –v- Royal Mail Group Limited.  Mr Nayak was employed by the Royal Mail for over 6 years.  Mr Nayak held a series of visas granting him the right to work in the UK.  However, his final visa application was refused and then subsequently passed to the Home Office for consideration and processing after an appeal.  The Home Office confirmed to the Royal Mail that Mr Nayak had the right to work in the UK on the basis of an outstanding appeal.  The Royal Mail thereafter made periodic checks to determine whether Mr Nayak had received the outcome of his appeal, requesting updates from both the employee and from the Home Office.  However, after four years, the Royal Mail still had not received positive confirmation that Mr Nayak’s visa had been granted.  Given the time which had passed, the Royal Mail determined that they could no longer consider that Mr Nayak’s application was still “pending and undetermined” and therefore concluded that Mr Nayak no longer had the right to work in the UK.  Mr Nayak was subsequently dismissed and after an unsuccessful appeal, he lodged a claim of unfair dismissal.  However, both the Employment Tribunal and the Employment Appeal Tribunal each agreed that there was sufficient evidence available to the Royal Mail to allow the employer to form a reasonable belief that Mr Nayak no longer held the right to work in the UK, and therefore Mr Nayak was fairly dismissed for “some other substantial reason” (SOSR). 

This “SOSR” ground was contrasted to the “statutory restriction” ground as the employer was not required to have actual knowledge of the contravention, which would be required in order to establish a fair “statutory restriction” termination.  This case is therefore a helpful reminder to employers in circumstances where it is unable to obtain conclusive evidence of the employee’s right to work in the UK. 

For more information please contact Martin Sinclair or Nicola Gray or call 01224 632464.

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