Director Disqualified for 6 years for Employing Illegal Workers

Charles Abraham, Head of Disputes , reviews a recent case which serves as a timely reminder to all directors on the penalties of unfit conduct.

A restaurant owner has been disqualified from acting as director following his employment of two illegal workers in breach of the Immigration, Asylum and Nationality Act 2006.

The director ran a restaurant trading as Weymouth Tandoori. On 27 January 2015, Home Office Immigration Enforcement Officers visited the restaurant and found that he was employing two workers who were not eligible to work in the UK. The company went into liquidation on 31 July 2015, owing its creditors £33,802, of which £20,000 was the fine imposed by the Home Office Immigration Enforcement team for employing the two illegal workers.

By virtue of the Immigration, Asylum and Nationality Act 2006, employers are responsible for ensuring that their companies do not employ workers who do not have the right to work within the UK. The company is required to undertake, and prove that it has undertaken, checks on workers to establish their entitlement to work prior to recruitment.

The director signed a disqualification undertaking banning him from being a director of a company or from being involved in the promotion, formation, or management of a company for six years from 15 September 2016.

As a reminder director may be disqualified following conviction for an offence under the criminal regime, or as a result of unfit conduct under the civil regime. Unfit conduct includes:

• Continuing to trade to the detriment of creditors at a time when the company was insolvent.
• Conduct that deliberately deprives creditors of assets.
• Fraudulent behaviour.
• Failure to keep or deliver up appropriate accounting records.
• Failure to prepare and file accounts or make returns to Companies House.
• Failure to submit tax returns or pay over to the Crown tax or other money due.
• Letting somebody else run the company for you, or failing to ensure it is run properly.
• Failure to comply with other regulatory requirements.
• Failure to co-operate with the official receiver or insolvency practitioner.

This article was written by Charles Abraham, Head of the Disputes department.

Charles is experienced in litigation (including applications for injunctive relief), mediation and arbitration. He has acted on numerous high profile and large value disputes. He has been extensively published on litigation matters.

Call Charles on 0113 201 0405 or email ku.oc1701659209.fcl@1701659209mahar1701659209bac1701659209