Landmark Court of Appeal Judgment: Judicial Discretion in Illegal Working Civil Penalties

Clarendon Park Chambers is pleased to announce a significant outcome in the Court of Appeal, in a judgment which fundamentally changes the landscape of civil penalty appeals under the Immigration, Asylum and Nationality Act 2006.

In Johal v Secretary of State for the Home Department and Jen & Jamie Limited v Secretary of State for the Home Department, judgment handed down on 11 November 2026, the Court of Appeal considered an important question of principle: are County Court judges bound by the Home Office’s Code of Practice when determining the amount of an illegal working civil penalty, or do they retain a wider statutory discretion to reduce penalties?

Until now, the approach adopted in a number of County Court decisions was that judges were effectively bound by the financial penalties and limited reductions prescribed by the Code. The Secretary of State maintained that matters falling outside the Code were irrelevant and could not justify a reduction.

The Court of Appeal has decisively rejected that restrictive interpretation.

At paragraphs 44–49, the Court confirmed that judges are not confined to the Code when determining whether a civil penalty is too high. Section 17(3)(b) expressly permits consideration of other relevant circumstances, including financial means, totality and matters bearing upon culpability. The Code remains the starting point, but it does not extinguish the discretion conferred by Parliament.

This is a landmark development in an area of law where employers face penalties of up to £60,000 per worker. The judgment fundamentally clarifies the powers of the County Court and opens the door to arguments which had previously been considered unavailable.

In Johal, the appeal was allowed following the Secretary of State’s withdrawal of the original Civil Penalty Notice. The companion appeal was remitted to the County Court for reconsideration of the penalty.

Zainul Jafferji and Sheraaz Hingora of Clarendon Park Chambers appeared for Mr Johal in the Court of Appeal, instructed by FR Solicitors. Sheraaz Hingora also represented Mr Johal in the original County Court proceedings.

Our barristers are at the forefront of developing the law concerning civil penalties, statutory appeals and the limits of executive decision-making.

We will be publishing further analysis of this important judgment, including its implications for existing and future civil penalty appeals.

For advice or representation concerning an illegal working civil penalty, or the implications of this judgment for your case, please contact Clarendon Park Chambers.