Why Right to Work checks should remain digital for good

With little choice thanks to the person-to-person transmissible coronavirus, the Home Office made temporary changes to Right to Work checks on March 30th, with the effect that employers could verify an individual’s right to work on an online basis only, and it’s something that should stay for good, writes Lucy Smith, managing director of Clarity Umbrella.

Digital RTW checking: in practice

Under what was described by officials at the time as a “temporary adjustment,” no doubt because of covid-19, there was no requirement on employers or candidates to meet in person, and no requirement to handle personal documents.

Since March 30th, and even currently following the government’s decision to extend the digital version of the checks, newly starting contractors simply need to provide a copy of, say, their passport. This then gets verified via video link, with both the call and document evidenced by a screenshot or equivalent.

Earlier this week, the government announced that such digital RTW checks would not end on May 17th (as originally scheduled by the government), but instead would extend until June 21st 2021. With the coronavirus still present this was reassuring to employers and workers, as it means they would not have to suddenly meet, interact and exchange documents.

Amid IR35 reform, digital RTW checks are a boon for busy brollies

This extension of digital RTW checks is particularly great news for contractors so soon after IR35 reform was introduced because, if engaging via an umbrella company or direct with PAYE through an agency, a contractor will still be able to supply a digital copy of their passport, rather than parting with the original. I’m yet to a meet a contractor (some of the most likely UK workers in the UK workforce to work abroad), who thinks handing over their original passport is desirable or practical.

It is worth noting that it has always been possible to complete a video RTW check under the Home Office’s guidance on the process. But even then, there was still a legal requirement for umbrella companies to physically handle the ID documents before the check could be completed.

Risks, downloads and a mismatch

However, the original checks assume that the individual completing the RTW process can spot the correct watermarks, random fibres in the document, background print, and intaglio ink. As ID fraud becomes more and more advanced, there is always the risk that the employer is unable to spot a fraudulent document.

The currently applicable digital concessions on RTW checks are surely likely to be welcomed by all employers. But be aware that non-EEA nationals (who hold biometric residence permits or biometric residence cards) and EEA nationals (who have been granted settled status under the EU Settlement Scheme), will still be able to prove their Right to Work online by creating and sharing a code with their employer. This virtual system will continue to do a brisk business even when the rest of us revert to physical checks on June 21st.

Employers of such workers (non-EEA and EEA nationals) can then check these codes to confirm the person’s Right to Work status and then they simply download and keep a copy of the check as proof.

To our umbrella company, it rather beggars belief that the government then asks people who are already UK residents (and UK taxpayers), to provide documentation in a completely different, less efficient and (currently riskier) way.

A more streamlined approach would surely be a sensible approach for UK residents. We hope that this mismatch is considered when the BEIS-promised review of technology’s usage in Right to Work checks is carried out shortly. Hopefully, RTW checks for UK workers will be brought in line with these more efficient RTW checks for others.

Looking behind the times

Indeed, at a time when there is great and proper emphasis on equal treatment in the world, the UK government risks appearing a little behind in their thinking, if they don’t reconsider and go digital for RTW checks on a permanent basis.

With umbrella companies in particular, if you consider that although the umbrella is the employer, the contractor could of course be based anywhere in the UK. Tied to this, there are very few occasions when the umbrella would actually need to physically meet the umbrella contractor in person, leaving the only option (under the original, in-person RTW checking regime) to physically send in original documents.

Quite understandably, at least in my view, contractors have never been big fans of sending in their original documentation. In line with their concerns, the government in considering moving to digital checks beyond June 21st should be aware that the online-only system may help prevent or reduce identity fraud, which can potentially be facilitated through mislaid documentation in the postal system.  

Umbrella trumps the agency

Lastly, a slightly overlooked fact. If a contractor works via a recruitment agency under PAYE, on the agency’s books, then the agency will continue to complete right to work checks. But if the individual is working via an umbrella company, then the actual responsibility for performing the right to work check rests with the umbrella, as the individual’s employer (rather than the agency).

For those contractors using an umbrella company already, the digital RTW checking process will not directly impact them. However for newcomer brolly contractors – i.e. those engaging with an umbrella company for their very first assignment, which is a widely accepted consequence of IR35 reform, the digital system simply means that the umbrella can seamlessly continue to receive the workers’ digital ID file and continue conducting online video calls to verify the identity of each individual.

And finally, June 21st is a unique opportunity

We sincerely hope this new way of working and this quicker way of putting people into work, is here to stay. With blots on the work-scape like IR35 reform and coronavirus, June 21st is an opportunity for the government to turn a temporary adjustment into a permanent advantage, for both workers and employers alike.

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Written by Lucy Smith

Lucy has over 9 years extensive experience in the umbrella market, much of this time spent managing one of the most reputable umbrella companies in the market and now, Clarity Umbrella.
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