Court of Appeal Hears Civil Penalty Appeals | Judgment Reserved

By ZH Law

Civil penalty notices issued to UK businesses can be up to £60,000 per worker. The Court of Appeal has now heard two linked appeals on whether Courts can reduce those penalties beyond the Home Office’s Code of Practice. Judgment has been reserved.

Zainul Jafferji, Principal Barrister and Founder of ZH Law, appeared as leading counsel in Johal v The Secretary of State for the Home Department which was heard together with Jen & Jamie v The Secretary of State for the Home Department, alongside Barrister Sheraaz Hingora. Mr Hingora drafted the grounds of appeal and skeleton argument that secured permission to appeal. The appeals were heard together on 13 and 14 October 2026.

What Is the Court of Appeal Being Asked to Decide?

When an employer appeals a civil penalty, is the Court limited to the reductions set out in the Home Office Code of Practice, such as self-reporting and co-operation? Or can it reduce the penalty for other relevant reasons?

Why Does Section 17 Matter?

Under Section 17 of the Immigration, Asylum and Nationality Act 2006, an employer can appeal on the ground that the penalty is too high. The appeal is a rehearing, and the Court must have regard to the Code of Practice and any other matters it considers relevant.

The Appellants contend that this wording confers upon the Courts a discretion extending beyond the confines of the Code. The Secretary of State, by contrast, maintains that the Code is determinative of the appropriate penalty and that the Courts’ discretion is circumscribed by its provisions.

How Did the Appeal Reach the Court of Appeal?

In Johal, the County Court declined to reduce the penalty. On 12 January 2026, Lord Justice Singh granted permission to appeal on one ground only, the scope of the court’s discretion. He recognised that it raised an important question of principle and practice that no appeal court had yet decided.

Why Does This Matter for Employers?

Since 13 February 2024, the starting penalty is £45,000 per worker for a first breach and £60,000 for a repeat breach. For a smaller business, a single penalty can have severe financial consequences.

If the Court of Appeal finds that the court has a wider discretion, employers may be able to put forward mitigation beyond the Code, such as the effect of the penalty on the business. If it takes the narrower view, challenges to the amount may stay confined to the Code.

What Happens Next?

The Court of Appeal has reserved its judgment. Until it is handed down, the law and the Code of Practice apply as they do now. We will share an update when judgment is published.

What Should a Business Do If It Receives a Civil Penalty Notice?

Check the date on the notice and the deadline to respond. Gather your right to work check records for every worker named. Get legal advice before you reply to the Home Office. The deadlines are short and strict.

What Does This Mean for ZH Law Clients?

ZH Law acts for businesses facing civil penalty notices and other Home Office enforcement action(s), with direct access to experienced barristers.

If you would like to discuss a civil penalty notice with our team, please do not hesitate to contact us.

London: 0203 887 7306 | Leicester: 0116 365 6400 | enquiries@zh-law.co.uk

This article is provided for general information only and does not constitute legal advice. Immigration law and Home Office guidance are subject to change. Advice should be obtained on the particular circumstances of each case.