7th August 2026
The hidden economy, unfair competition and organised crime links behind the Government's enforcement drive
The Government's renewed crackdown on illegal working has placed the spotlight on an issue that sits at the crossroads of immigration, employment law, business competition and organised crime.
But how big is the problem?
How many businesses are involved?
And does illegal working simply mean someone does not have permission to work, or can it be part of something much more serious?
What is illegal working?
Illegal working occurs when someone works in the UK without the legal right to do so.
This can include:
people who have entered the UK without permission;
people whose visa does not allow them to work;
people who continue working after their permission to remain has expired;
people working more hours or in different jobs than their immigration conditions allow.
For employers, the responsibility is clear.
Businesses must carry out right-to-work checks before employing someone.
If they fail to do so, they can face substantial penalties.
The scale of the crackdown
The Government has significantly increased enforcement activity.
Immigration Enforcement carried out more than 17,400 raids on businesses between July 2024 and the end of 2025, with more than 12,300 arrests made.
The Government says the action represents the largest enforcement effort against illegal working since records began.
The businesses targeted have included:
takeaways;
car washes;
beauty businesses;
barbers;
construction-related activities;
delivery and courier services.
How many businesses are actually involved?
This is one of the most difficult questions to answer.
There is no exact figure for the number of UK businesses employing illegal workers.
That is because illegal working is, by definition, hidden.
Some cases involve employers who have failed to carry out proper checks.
Others involve businesses deliberately ignoring the rules because illegal labour is cheaper.
The enforcement figures show thousands of businesses have been investigated, but they do not mean thousands of companies across the economy are involved.
The vast majority of UK businesses operate legally and follow employment rules.
Why does illegal working matter to legitimate businesses?
Illegal employment can create unfair competition.
A business paying:
the National Minimum Wage;
National Insurance;
pension contributions;
holiday pay;
workplace protections;
faces higher costs than a business ignoring the rules.
This can put honest employers at a disadvantage.
That is why the Government argues that enforcement is not only an immigration issue but also about protecting legitimate businesses.
The organised crime connection
One of the most serious aspects is where illegal working overlaps with organised crime.
In some cases criminal groups may arrange:
illegal entry into the UK;
fraudulent documents;
exploitative employment;
accommodation tied to employment;
debt bondage.
The most serious cases can involve modern slavery, where workers are controlled, underpaid or threatened.
HM Revenue and Customs guidance highlights that illegal working can be linked to exploitation, trafficking and forced labour in the worst cases.
Are all illegal workers victims?
No.
The reality is more complicated.
Some individuals knowingly break immigration rules to work.
Others may have been exploited by people who promise employment but then trap them in poor conditions.
That is why enforcement agencies distinguish between:
the worker;
the employer;
organised criminal networks.
The greatest focus is often on those who profit from exploitation.
Why certain sectors are targeted
Some industries are more vulnerable because they rely heavily on:
low-paid labour;
cash transactions;
subcontracting;
temporary workers;
high staff turnover.
This does not mean every business in these sectors is involved.
However, enforcement agencies tend to focus where there is a higher risk of abuse.
What are the penalties for employers?
Businesses can face significant consequences.
Penalties include:
civil fines;
criminal prosecution in serious cases;
reputational damage;
loss of licences in regulated industries.
The message from Government is that employers cannot treat immigration checks as optional.
Could this affect rural Scotland?
Although much of the enforcement attention has focused on urban areas, rural businesses should not assume they are outside the issue.
Highland industries that rely on seasonal or temporary labour include:
hospitality;
tourism;
agriculture;
food processing;
fisheries-related businesses.
For legitimate employers, maintaining proper records and right-to-work checks is essential.
Small businesses may not have dedicated human resources departments, making compliance particularly important.
The wider economic question
Illegal working raises a broader debate about the labour market.
Businesses often say they face shortages of workers, while the Government argues that employers should invest more in recruiting and training people legally available to work.
The challenge is finding the balance between:
ensuring businesses can recruit;
protecting workers;
preventing exploitation;
maintaining fair competition.
Conclusion: a hidden problem with visible consequences
Illegal working is difficult to measure because much of it operates below the surface.
But the Government's enforcement figures show it is large enough to justify a major response.
The issue is not simply about immigration status.
It is also about:
protecting vulnerable workers;
preventing criminal exploitation;
ensuring businesses compete fairly;
protecting the tax system.
For most UK businesses, the message is straightforward:
Employing people legally is not just a legal obligation.
It is part of creating a fair economy where honest businesses are not undercut by those willing to break the rules.