A restaurant proprietor in Cheshire has been disqualified from being a director for eight years after closing his business down instead of paying a hefty £25,000 fine imposed by the UK Border Agency.
Mr Miah ran a restaurant in the parish of Tarporley, in the heart of rural Cheshire. However in 2010 Mr Miah's establishment, a fusion of East and West which served Indian food in an old-style village pub and which had won several culinary awards, was found to be employing several workers who did not have the right to work in the UK. In line with the UK Border Agency's practice, he received a civil penalty for £25,000. Rather than paying the penalty, Mr Miah transferred £68,162 out of the company's account and placed his business into liquidation. Further to the liquidation, disqualification proceedings were advanced and he was disqualified as a director until May 2021.
With immigration firmly at the top of the public agenda and the government's determination to "crack down" on illegal working, stories like Mr Miah's are becoming increasingly common. Recently, seventeen men were found to be working illegally following raids on restaurants and takeaways in Oban and in the past Tesco has been found liable for employing workers unlawfully. The penalty for employing those without the right to work can amount to £10,000 per worker, although an employer will have a defence if they carry out the proper checks and hold on record copies of the appropriate paperwork. Most of the businesses involved in the Oban raids were small independent businesses, and at least one of the businesses faces a penalty of £50,000 for having employed five workers who did not hold the correct paperwork.
With penalties of this level, there is the possibility that small businesses could be forced to close. Perhaps appreciating that this may be an outcome, Mr Miah took the less honourable step of unlawfully transferring assets out of his business. He therefore breached the duty he held as a director to his company's creditors - who included the UK Border Agency.
An Insolvency Service spokesperson was quoted as saying that the disqualification "sends a clear message to other company directors; if you run a business in a way that is detrimental to either its customers or its creditors you will be in our sights". Such bullish words raise two issues. Firstly, was it the actions (a gratuitous alienation), the offended creditor (the public purse) or a mixture of both that brought Mr Miah such a relatively long disqualification (in the middle of the "Sevenoaks" bandings)?
Secondly, should the company - having been censured and fined by the UKBA in July 2010 - have been pursued more rigorously for payment? Should the UKBA not have pressed for their winding up rather than allowing the director to undertake these steps, eventually winding up the company himself in September 2010? In other words, if there is to be such enforcement action (at significant public cost), is it matched by debt recovery steps thereafter? Had the Insolvency Service not intervened, it would be likely that Mr Miah would have had problems with his local licensing authorities as a result of having received a civil penalty but no greater issue due to its non-payment. The disqualification of businesspeople like Mr Miah may or may not placate those creditors owed money, including the public purse. It is a situation which leaves several parties disgruntled - not to mention, of course, curry enthusiasts from Tarporley to Oban!