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Brexit Fraud Risks - EU Settlement Scheme

October 13, 2020
In the face of the global Coronavirus pandemic, Brexit has fallen out of the news, but as we get closer to 31st December 2020 it’s important to remember that Brexit brings some big changes, including fraud risks. If your business employs EU nationals, you will be affected by Brexit and failure to act could have a big impact on your business.

Free movement of people will end from 1st January 2021 and the UK will introduce a points-based immigration system. EU citizens already living in the UK by 31st December 2020 are eligible to apply to the EU Settlement Scheme and will have until 30 June 2021 to make an application. However, after that date if they do not have pre-settled or settled status they will be unable to live and work lawfully in the UK.
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In a recent CIPD Podcast: The true cost of post-Brexit recruitment; Ian Robinson of Fragomen LLP, a global firm of immigration law experts, stated that:


In my opinion there is a duty of care owed by employers to their employee’s, often times simply because if a person doesn’t apply [for settled or pre-settled status] their life could be turned upside down, and the more you can do to educate them, to direct them, and make sure that they know what is needed the better”.


Do you know how many EU nationals you employ?

How many of those are in ‘business critical’ roles?

Do you know whether they have pre-settled or settled status? 


These are important questions, because failing to identify employees who are EU nationals and support them in obtaining pre-settled or settled status may result in your employees having no right to work in the UK after 30 June 2021. Employees may also face prosecution under immigration legislation and the Fraud Act 2006 (if they fail to disclose their immigration status or lie about it).


Employers may face civil penalties of up to £20,000 per illegal worker and a business closure notice which effectively shuts a business operation for 48 hours. Employers may also face prosecution under immigration legislation which could result in up to 5 years imprisonment and an unlimited fine. Clearly these sanctions would also attract a significant amount of associated reputational damage.


SAFE is currently working with our clients to assess risks associated with Brexit to help our clients effectively manage those risks. Get in touch to find out how we could help your business to identify, assess and manage Brexit related fraud risks as well as those associated with other areas of your business including procurement and finance/accounts payable. 



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