Section 48 of the Border Security, Asylum and Immigration Act 2025 commences on 1 October 2026. This amends section 15 of the Immigration, Asylum and Nationality Act 2006 (2006 Act) to expand the definition of “employment” when determining whether an employer is liable for employing an adult subject to immigration control who does not have the correct permission to do the work in question.
This summer, the Home Office published its draft code of practice relating to the changes. According to the code, from 1 October 2026, the Home Office will, in theory, be able to sanction organisations for illegal working not only by their own employees (under the expanded definition), but also by subcontractors’ employees, substitute workers and workers matched with clients (where a business operates as an online matching service).
Protecting organisations with subcontracting chains and online matching services from massive illegal working penalties will involve not only ensuring that HR teams conduct right to work checks correctly, but also advising on amendments to commercial contracts.
Outsourcing immigration controls
Illegal working sanctions began in 1997 with the offence of illegal employment. The original version of the 2006 Act then introduced a framework of civil penalties and statutory excuses to ensure that checks were being carried out by employers. These changes effectively outsourced immigration control to employers. The state would not stand at every factory gate. Instead, employers verify right to work status with the prescribed check, properly conducted, allowing them a statutory excuse against a civil penalty. HR teams have become familiar with these compliance requirements, with help from immigration lawyers and where necessary from their counterparts in employment law.
Now Section 48 of last year’s Border Security, Asylum and Immigration Act inserts new sections 14A and 15A into the 2006 Act, expanding both the definition of employment and the class of persons who may lead to liability. The amendments extend the burden of private-sector enforcement of immigration control beyond the employment relationship and into commercial contracting chains. The consequences will be felt not only by immigration and employment lawyers but by in-house counsel and contract lawyers previously untroubled by right to work compliance.
The expanded definition of employment
From 1 October 2026, the following working arrangements are deemed to be “employment” when considering whether a worker has been employed without the requisite right to work. This expansion of direct liability covers many casual, zero-hours and temporary arrangements which reflect the ways in which the modern workplace has changed since 2006 when this framework was put in place. It also explicitly exempts traditionally self-employed workers.
1. Contract of employment.
This already applies to employers under the current rules.
2. Worker’s contract
Where a worker agrees to perform work or services personally for an organisation and that organisation is not a client or customer of any profession or business undertaking carried on by the worker. In this case the worker is deemed to be employed by the organisation, which can be liable for a civil penalty if the worker does not have the right to work.
3. Individual subcontractor
Where a worker enters into a contract for work or services with an organisation, and that organisation has itself been contracted by a third party to provide the same work or services (and the worker has no direct relationship with that third party). The worker is deemed to be employed by the organisation, which can be liable for a civil penalty if the worker does not have the right to work. The third party is not liable.
4. Online matching services
An online matching service (which is a specifically defined term in the code of practice) connects customers with suitable individual service providers on their list. By providing these individual service providers’ details on its platform, the online matching service is deemed to be employing them and can be liable for a civil penalty if the individual service provider does not have the right to work.
Extended liability under section 15A
In a major overhaul, under what will be the new section 15A of the 2006 Act, an organisation can receive a civil penalty of up to £60,000 per worker even where it is not directly engaging the worker. Liability may be extended under three arrangements:
1. Subcontracting chains
A contractor enters into a contract for work or services with an end user. The contractor then subcontracts some or all of that work to a subcontractor, which employs workers to carry it out. Both the contractor and subcontractor can be liable for a civil penalty if the subcontractor’s workers do not have the right to work. The same continues down the chain for all subsequent subcontractors under the same contract for work or services. Of note, the end user (i.e. the party which wanted the work or services to begin with) is not liable.
2. Online matching
An online matching service connects a service provider with a client or customer, who then enter into a contract for work or services. Both the online matching service and the service provider may be liable if the service provider’s workers do not have the right to work. The client or customer is not liable.
3. Substitution
An organisation engages a worker, and the contract permits that worker to substitute another individual to carry out the work in their place. The organisation may be liable if the other individual does not have the right to work, even where it has no direct relationship with the substitute.
How organisations can protect themselves
Organisations can establish a statutory excuse against extended liability by following what are called the “prescribed requirements” before any work is carried out or services are provided under the contract, namely:
Each of these has a number of highly specific requirements which must be met, put into practice, and enforced to establish a statutory excuse. There is too much detail to cover concisely here, but an example of a prescribed “contractual term and condition” includes permitting upstream organisations to conduct audits of downstream organisations’ compliance with prescribed right to work checks.
Of note, it is not enough to put contractual terms in place and leave it there; when deciding whether or not to impose a civil penalty, the Home Office will consider whether the requirements operated effectively in practice. Organisations should be able to show that the arrangements are both in place and operating effectively in practice, and that they have taken reasonable and proportionate steps to satisfy themselves that right to work requirements are being met.
Consequences across practice areas
For in-house counsel, the immediate task is exposure mapping. Liability is per worker and is not capped. Certain sectors, such as construction, logistics, facilities management and outsourced services, where visibility of the end workforce is weakest, will be the most exposed.
Extended liability runs in both directions: an organisation must identify
where its own contracts create section 15A liability.
where it sits within its customers' chains.
which subcontractors will lead to exposure.
All will shortly require the prescribed terms to be added to contracts, including audit rights.
For contract lawyers, the prescribed requirements must now be incorporated into contracts where work and services are being subcontracted. The prescribed requirements must also operate well in practice, so monitoring and enforcement should also be front of mind.
For employment lawyers, any kind of worker’s contract with a substitution clause will need to be revisited with the prescribed requirements in mind. From 1 October, substitution clauses will need to be accompanied by the requisite prescribed requirements.
For immigration lawyers, the work becomes cross-disciplinary, and immigration lawyers will need to ensure that their clients are being appropriately advised across the board.
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