Work Permits - All above board

A finance director’s responsibilities can be pretty far reaching. It is not unusual for these to include a role in the recruitment of key employees.

Finding the right employee for the job can be a time-consuming exercise at the best of times. It is not made any easier when there is a skills shortage.

The exercise can become increasingly frustrating if it transpires that the employee does not have an automatic right to work in the UK. A lot can hang on a work permit, whether your business is banking, IT or football.

Commercial pressures and tight deadlines increase the temptation to set the employee to work immediately and sort out paperwork later. This approach is risky as well as illegal.

Nationals from the European Area, which includes all countries in the EU together with Norway, Iceland and Liechtenstein, are allowed to work in the UK without any restrictions on their employment. The same rule normally applies to non-EEA workers who are married to EEA citizens where the EEA spouse is exercising the right of free movement under the EC treaty.

One of the greatest frustrations for multinational companies providing a global service is the absence of a European-wide work permit.

The principle is well established under law that a company incorporated in one member state has the right to transfer employees, including non-EU nationals, for the provision of services in another member state. But this principle has not to date been implemented in all member states, while in others unjustifiably restrictive conditions of entry have been imposed.

Attempts are gradually being made to address this problem. The European Commission has recently proposed that non-EU citizens should be able to apply for a card, valid for 12 months, guaranteeing their right to work throughout the EU, but a single European work permit still seems some way off.

Applications for work permits should be made by the workers’ prospective employer. There are a number of categories of permission available, including training and work experience permits. The most popular is the full work permit.

In broad terms, the employer must be able to satisfy the Overseas Labour Service of the Department for Education and Employment that there is no other person in the UK or the rest of the EEA who is able to do the particular job. The aim of the work permit scheme is, where possible, to safeguard the resident labour market.

It is usually necessary for any post to be advertised in the UK and the remainder of the EEA to show that there is no worker within this area capable of filling the position. This requirement can be waived where the position is very specialised.

The waiver covers senior board appointments, posts that are essential to attracting jobs and capital to the UK and occupations that are acknowledged by the relevant industry to be in short supply nationally. The advertising restriction is also often waived when employees are brought to the UK on an intra-company transfer.

The common problem is that those involved on the operational side of a business are often not aware of the procedures that must be followed before a non-EEA national can be employed in the UK.

The employee is often given a start date and contract of employment, neither of which is conditional on obtaining a work permit.

A work permit application is then submitted in respect of the employee who may already be illegally working for the employer under the guise of a business visitor’s visa. A business visitor is entitled to carry out certain duties while in the UK, but this does not stretch to working full-time for a prospective employer.

Another shortcut used by employers in a hurry, is to filter its employees in through the Irish Republic. This is because once the employees clear Irish immigration controls there are no further immigration controls between the republic and the UK.

The temptation of taking one of these routes is all the greater when it may take the Overseas Labour Service four to six weeks to process a work permit application.

The danger is that when the Overseas Labour Service comes to processing an application it may require evidence that the post has been advertised and that no suitable EEA nationals have been located. If this requirement is not satisfied there is a real risk that the application will be rejected.

An employer may then be left with an employee lured on the offer of a generous relocation package, who cannot be employed in the position for which they were recruited. This could lead to the employer dismissing the employee and having to pay substantial compensation.

All of this points to the importance of co-ordination between those making the recruitment decision and those sorting out the paperwork.

Fortunately, the Overseas Labour Service is a pragmatic and helpful organisation. It is willing to meet employers and their advisers to discuss prospective applications and its current approach and thinking.

This is particularly useful when an employer’s future plans are dependent on receiving guidance on whether they will be able to import the necessary overseas expertise.

Obtaining work permits can be a frustrating process. However, employers should bear in mind that it is an offence to employ workers who do not have the necessary authorisation. Employers guilty of such an offence could be subject to a fine. If handled the wrong way a potentially frustrating process is capable of becoming both embarrassing and expensive.

Ian Hunter is a partner and employment law specialist with City law firm Bird & Bird and author of the Which? Guide to Employment.