UKH

I was having a hard time finding employment. So, my parents' immigrant "friend" gave me an unconditional offer of employment (part-time). 

While I'm officially in part-time employment, I don't actually get to keep the majority of my wages (partly because the company is still new and I don't get to work on a regular basis).

Every month or so, I'm obligated to give 80% of my wages back in cash (while the remaining 20% was to compensate for them having my name in their company).

I've been asking myself if this was illegal or not and have attempted to find this out but couldn't find any information on it.

Is this illegal? Or is this part a loophole so it couldn't be considered legal/illegal?

One last thing (EDITED):

Encase you're wondering why I accepted the offer in the first place, it's because I was desperate, but hopeful that this was going to be temporary. I realised now that this was all a con. When they first mentioned this I was very confused and they never explained why I had to return the wage. 

Eventually, I understood why. They said the immigration law states that immigrants starting their own company must employ at least 2 people (and give minimum wage) to remain in the UK.

I am still job searching.

Run a mile.  That sounds like money laundering to me.

Do you do any work for the company? 

Yes technically. From my point of view, my situation is more or less like working with a zero-hour contract even though my contract says 30 hours.

Sounds like a case for the police, HMRC and immigration. I'd make a sharp exit before you are implicated or complicit. 

Run.A.Mile

They are taking advantage of you. From reading your one other post on here, you give the impression of somebody who might be vulnerable to being taken advantage of. ("I get nervous speaking to people on phone and cannot see them")

What is their business and what do they have you doing?

They said the immigration law states that immigrants starting their own company must employ at least 2 people (and give minimum wage) to remain in the UK.

I'd say they are ripping you off, at best. At worst, as others have mentioned, there could be some criminality involved.

I'd report it to the police, just to cover your arse. I'd report it to other agencies, including HMRC, to extract some sort of revenge for them ripping you off.  You can do this anonymously.

Whether or not you're working below minimum wage or in breach of visa conditions (why would you need an unconditional offer?) you're likely laundering money through your bank account.

Quit today. Take good legal advice before you consider going to the police, if you do and you have been laundering money even unwittingly you may well end up charged which could have lifelong implications when it comes to accessing finance among other things. Bear in mind you may make some dangerous enemies.

Sorry. Shit situation.

jk

In terms of the law, you must be paid minimum wage for the time you work. So add up all of money you actually got to keep and divide by the hours you actually worked. This should be more than the amount for your age in the link below. If they have not given you this then I would write a letter demanding the amount you are owed, and start looking for other employment. Keep a copy of the letter, and any other evidence you have of hours worked and amount paid.

https://www.gov.uk/national-minimum-wage-rates

Additionally you are entitled to a payslip each pay period, and a contract if you ask for one.

Finally, there is a well known scam where the scammer overpays for something (more generally they "buy" something from you online) and then gets the victim (you) to send them back the difference. Some time later you notice that the original overpayment has bounced, but by then it is impossible to recover the money you sent to the scammer (or the product). In general be very, very wary of anyone overpaying and asking you to repay them the difference.

^^^ This

You are very likely involved in laundering money for organised crime. Quit immediately and take legal advice before contacting the police. 

Your parents should also find some new 'friends'.

(incidentally, why was “friend” in quotations?)

"They said the immigration law states that immigrants starting their own company must employ at least 2 people (and give minimum wage) to remain in the UK."

Yes, you mentioned that in the OP, although it doesn't begin to explain the financial arrangement they have foisted upon you.

What is the business? What work are you performing for them?

Yes, agreed.  Quit now and get as far away as possible.  No legitimate employer will EVER ask you to pay wages back other than a one-off if you were accidentally overpaid or overclaimed expenses, and even then they would simply net them off the next pay packet in most cases.

This is almost certainly a cover for illegal activity i.e. money laundering.

Edit: Oh, it's because of a requirement to employ two full time people at minimum wage?  I didn't know that was the law.  But if it is, they are still not doing that and therefore you are complicit in them breaking the law.  I suspect they're lying about that and it's actually money laundering.

Did I say quit?  If not, quit.  You could end up seriously in the mire over this.

S/he was an acquaintance of my parents and my parents perceived the person positively, until I told them about how I was treated when given some work. Rudely snatched my equipment from me to double check, said some insulting things whether intentional or not, etc.

Even worse.

Quit.

As others have said, this is 99.9% certain to be money laundering. There is no legal requirement to employ 2 people in a company, immigrant or not. If you are lucky, there will be no trace of you in this company, and no record of deductions being paid to HMRC (income tax and national insurance), and no payslips. Mind you, i'd be surprised if there is any trace of the company at all.......

However as you have retained some money, it is likely that you, however unwittingly, have been complicit in money laundering.

If they paid you into your bank account, close it NOW, so they cant pay you anything else and then come round to "enforce" the previous cash refund arrangement.

Incidentally, what is the name of the company - its easy to do some checks and see how legit it is.

Edit - I note you have changed your username?

Changing your name to Englishcat, not telling us what the job was....the plot thickens! lol

PLease tell me S/He wasn't offering to refinance the balloon payment on your parents car.....

The company itself is legitimate. There have been deductions and I receive payslips.

I'm changing the username back. It may take a some time.

The company is a photography company. 

This sounds really dodgy. Sometimes life goes best if nobody finds out about anything unlawful one has unwittingly done, I second taking legal advice before going to the police (without advocating breaking the law or anything like that). 

It may turn out that the police would look kindly upon you if you've accidentally been involved, but skirting away from creating problems for anybody who has involved you in criminality seems like a wise thing to do.

Regarding this thread, advice is only as good as the events which follow, too. Annoyingly, or life would be simpler....

I don't see any sign of complicity, just trickery and exploitation

do the payslips show how much you have received and Kept as pay?  And whether you have had tax etc deducted?

If not the employer is not operating legitimately

At the end of the day it sounds like the OP has (unwittingly)allowed his/her bank account to be used for laundering money. However the police won't know if that's exploitation, wilful ignorance or complicity. That will be a matter for the CPS.

I think of myself as a law abiding citizen, but there's no way I'd be turning up at a police station and telling them everything without getting advice first.

Yes. The payslips showed how much was deducted and how much was paid to my account after tax. Like any payslip would.

I think wercat meant do the payslips account for the cash you have then paid back to the employer. If not then they are definitely doing something fishy that you don’t want to be implicated in. 

Yes mostly. Payslip says £1,020 (after tax). I then give back £703 (of that £1,020) in cash, and keep the remaining money as compensation. 

No other money involved on my end.

EDIT:

I've contacted the company and they let me leave, but asked me to stay a few more weeks before they find someone else to replace me. I'm trying to convince them to let me leave now.

What does your contract of employment say about a notice period?

If it doesn't, it's one week:

https://www.acas.org.uk/noticeperiod

It’s crystal clear what’s happening.

His employer needs to create two full time jobs to in order to qualify for his tier 1 visa, but clearly the business doesn’t have the financial power to hire two full time. It’s a common problem.

By giving back his wages in cash he helps makes it look to the home office as if the company had a full time employee, but in effect he is a part time employee masquerading as a full time employee.

The rules for entrepreneur visas are now so ridiculously tough people resort to all sorts of stupid scheme to get around them. Another great stupid policy.

4 weeks.

They are trying to cheat for their tier 1 visa.

Up to you whether you report to the police or not, if you do your employer will most likely be put in a detention centre and eventually deported out of the country.

As saddening as it is to have to collaborate with the home office Nazis, if I were you I’d be selfish and report your “employer” to cover my ass, but probably a good idea to speak to a solicitor first as you may already have committed an offence.

In any case you need to cut all ties with your employer immediately.

I think it's HVS+ or E0

So in that case the payslips don’t show that you have returned money and HMRC think you are being receiving £1020 rather than £317. If it was legit then your next months payslip would record the £703 you returned. 
 

Glad to hear they are letting you end your contract. Does your contract require you to give a certain notice period? If not you can leave now regardless of what they want or ask. If there is a notice period in the contract then as far as I know they cannot require you to work beyond that once you have notified them of your finishing date. I’m not sure if there is much they could do if you did just walk out the door though. They could refuse to give you a reference but you probably don’t want to be associated with them anyway. 
 

I am by no means an expert in employment law so all the above is just my opinion. I would imagine though that even if they had grounds to take action against you in a tribunal they probably wouldn’t - given that they are fiddling the books I can’t see them inviting legal scrutiny of any kind. 
 

EDIT: Just seen your comment about the 4week notice period. Pretty certain they can’t require you to work beyond that. Comments above about taking legal advice sound very sensible. Would citizens advice bureau be able to help with this sort of question if there were cost issues with a solicitor?

There was a piece on R4 about 3 weeks back about schoolkids recruiting each other into exactly this kind of overpay-refund money laundering scam. IIRC they were prosecuting all involved!

The advice to close the account seems reasonable to end the relationship difinitively, the people paying won't be the top of the chain and will have their own targets to hit if it is laundering.

Not sure how credible the visa scam excuse is, it sounds reasonable someone would want to inflate the apparent size of a business for reasons other than laundering. The cash return makes this seem slightly more likely since cash back from an employee still needs laundering.

Jk

You don’t need to negotiate anything at all here. They are in complete illegality and you have 100% leverage. Just leave. Today.

Tell them that you will only pay them back by bank transfer (not cash). 

Interesting, thx. I was completely unaware of this scam to con the system. Sounds plausible 

Tier 1 visa's no longer exist. Either an innovator or start up visa now, neirther of which have an "ermploying others" requirement.

https://www.gov.uk/tier-1-general

No, don't do this. Get out and close your bank account asap. Ask them for a P45, and move on.

Absolutely true but even though you can't apply for them anymore the one issued before they were closed down are still going and the requirement still exists, you still need to have created two jobs in order to qualify for ILR after 5 years, which I am guessing here, is what his employers are after.

Note that job creation is also one possible requirement in order to get for ILR after having been on the new innovator visa (expect it's 10 jobs, not two). But given that so few have been issued in practice (I think only two have actually ever been granted at the latest count) it's almost pointless to mention.

A lot of small business / startup started by foreigners in the UK have this problem.

As you rightly pointed out  Tier 1 has gone and has now been replaced by something  unworkable and totally corrupt. The UK is now virtually closed off to foreign entrepreneurs which is quite an astounding situation. 

But why would I need to close my bank account if the employer agrees to terminate my contract?

To prevent your “employer” continuing to pay monies to your account and insisting you pay them back?

It might also make you harder to trace should HMRC or the police start investigating, but I wouldn't count on it.

Because your employer is acting illegally, in a number of ways. With continued access to your account, they have the means to continue to involve you in their scheme, which I can absolutely guarantee is not designed to benefit you. They are acting highly illegally, and you need to protect yourself. In any case, a contract that results in the performance of criminal activity is unenforceable, whether through design or accident, so terminate your relationship with them asap, and if they attempt to contact you again put the phone down, or take any written communication to a solicitor.

Also because if they do get investigated and they are found to have paid to and received money from the OP, that account is likely to be frozen for some time for investigation.

Yrs, I read the two replacements on the gov website, and my main thought was "who the f... thought this up?" I havent gone into much depth, but even on a skim read, it is obviously designed to admit virtually nobody.

I wasnt aware that there was a munimum job creation requirement, however low it might be, but the whole idea is crazy. Is this part of the "hostile envirinment" policy? because it certainly appears hostile to me.....and all designed to exclude those who may well be wealth creators, a type of person I would have thought we should welcome......

Citizens advice may indeed be a good first port of call. They should at least be able to point you in the direction of appropriate legal advice on your position.

As others have said, bringing it to the attention of the authorities could land you in trouble for being complicit - however I'm sure they'll take a much more lenient view if you tell them, than they would if they find out by other means.

On the other hand, also have a think about who's involved and what the ramifications might be. I'm all for stopping organised crime, but probably not of there was a serious threat to my person.

Between money laundering and visa abuse I’m inclined to go with the latter. It makes a lot more sense to me having experience of the immigration system, and was my instinctive reaction on reading the OP.

If you want to launder money, you need to have proof of receipt via a legitimate channel, not proof that you paid your dirty money to an “employee”.

As for police vs CAB vs solicitor, it’s UKBA all the way. Those boys don’t muck about and the family “friend” will and should be swiftly dealt with.

As you can tell, I'm very worried. But I want to make this important clarification.

Upon getting comments, I was confused by mentions of money laundering. From my understanding, laundered money comes from criminal activities like selling drugs. 

I know my parents' friend long enough to doubt that s/he would be involved in such activities and the wage may well just come from his/her personal income (gained from legitimate work).

I personally may not be working as regularly and keep most of the wage as I thought I would, but that doesn't he/she is doing nothing to put food on their table. As BnB said, this might be visa abuse and not something as serious as money laundering?

Find a different adult friend completely unconnected with your parents, their friend and this company..  and ask them to help you sort this out. 

You’re paying tax on a certain income but not receiving that income. Walk away now and tell the Hmrc. Don’t be a mug.

How much do they pay you when you are obligated to pay 80% back in cash? Putting aside that they are clearly involved in some sort of scam that just sounds bonkers. I'd have politely agreed and kept the whole first month's pay and quit. 

I’m not sure that the reason why it is happening is really that important. Your original question was “is my employer doing something illegal” and the answer is almost certainly “yes”. Regardless of what the specific crime being committed is, you don’t want to be implicated or involved any more than you already are. 

I don't understand how this could be money laundering. My limited understanding of it is you have cash that you have obtained illegally that you want to get into the bank system as a legal payment. I don't see how them getting you to give them payments back as cash does that, quite the opposite.

There's obviously something dodgy going on though, get out quick.

The key thing about money laundering, is it's not meant to look like money laundering. How do you know that you 'friend' isn't getting some money from another 'friend'. They then give back 70%, use the remaining 30% to pay you. You give back 70% etc.

Run, is the advice that everyone is giving you. If your 'friend' disappears, then you're left holding the can. Remember to cover your arse. In a year or two, if this gets investigated, it will be only your word protecting you. Regardless of if it's money laundering or only 'visa abuse' it will be you in the dock as a potential accomplice.

I agree it is a dodgy situation and perhaps the prosecution service is taking an easy and unjust option to grill the easy catch when properly they are failing to recognise victim and fraudster.

After years of austerity it seems we can't expect too much from the state by way of proper judgement and process any more

There is certainly prima facie evidence of fraud on the part of the employer based on what has been stated.

Hidden in plain sight - many of us on here, me included, missed in your first post that they have admitted to you that they are doing this to circumvent visa laws - so you are involved in visa fraud / obtaining a visa by deception. According to the sentencing guidelines;

https://www.sentencingcouncil.org.uk/offences/magistrates-court/item/money-... 

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/... 

this is much more serious than money laundering at the level you were involved- see S25(1) on page 3 of the second link, but you would really need a lawyer to explain further; it looks like a minefield.........

Out of interest, what brought you to this website to join and ask two random questions on car finance, and being involved in visa fraud and potentially money laundering? They seem incongruous with a climbing website.  Certainly wouldn't have been my first port of call, unless this is a kind of sock puppet account to protect your identity ?

I originally signed up to ask about car finance and I didn't take into the account the website being a climbing website. I didn't know that until later. It was just a place where I could ask questions. Yes you are right, I should've gone to a more appropriate website.

Well you lucked out, because UKC has a very broad user base which, as usual, has provided some solid advice above. Hope you manage to sort it all out.

Let us know how you get on.

Indeed, good luck!

How could you not know this wasn't a car-oriented website from the moment you opened it? This doesn't add up.

I did wonder

Maybe the OP would like to take up climbing?

to be complicit (which requires a common intent) I would think the fact that the arrangement disadvantages the OP (handing wage,s owed as compensation for actual work done, back to the employer under pressure) together with what sounds some pressure (perhaps less than duress, but arguably so for someone in a very weak social position) and that there appears to be no common financial benefit to the parties would argue against it.  This has more in common with the slave exploitation gangs

If there is nothing written down, it's his word against the other chaps. I would hazard a guess that there is no contract detailing this wage sharing arrangement.

All the bank records will show is that money was paid in. Some cash was taken out. An observer might say the cash could have been for anything. Was OP was disadvantaged by the deal or did they spend the money on beer and fags?

That was my thinking, and the exact reason why a cash repayment was requested; no traceability.

Why have you changed your username again??

I'm beginning to suspect that you are a scam and should be reported to the moderators if not the police. Everything you've posted suggests that you are complicit in a borderline/probably illegal enterprise.