Rogue employers will face fines, asset seizures and disqualification from holding company office under a new government plan to tackle illegal immigration.
Business groups responded with dismay to the proposals, contained in a blueprint for a new immigration regime announced in the Commons yesterday by John Reid, home secretary.
They warned it could alienate business if the law was used against bosses who made unwitting mistakes.
John Cridland, deputy director-general of the CBI employers' body, said: "Emp-loyers already bend over backwards to keep up with the complex and changing demands of the law against illegal working.
"Their job is made harder by increasingly sophisticated attempts by illegal immigrants to dupe them and by inadequacies in government management of a system which would be much more successful if its enforcement powers were effectively used."
Mr Reid said his plan was drawn up after recent events - the foreign prisoners fiasco and a succession of embarrassing admissions about illegal immigration - highlighted weaknesses in the Immigration and Nationality Directorate. But it was also a response to the sheer scale of modern migration.
He promised to strengthen border controls, increase resources and toughen policy on enforcing immigration decisions and make legal migration easier, in particular to meet skills shortages.
Two eye-catching initiatives attracted instant controversy - encouraging members of the public to call Crimestoppers if they suspected illegal workers were being used and giving immigration officers a uniform and visible presence at ports and airports. Conservatives condemned the latter as "a ludicrous piece of window dressing" and called for a border police.
The funds for overhauling the IND and its systems will be met in part through short-term internal savings at the Home Office and longer term efficiencies, for example, from having fewer failed asylum seekers in the country awaiting appeals or removal.
But charges for those using the visa and permit system will also increase "to reflect the true cost of this activity to the UK taxpayer while also acknowledging the benefits that travel, migration and international students bring to the economy".
An expert panel to advise on where migration could help the economy shouldbe established, Mr Reidsuggested.
Most of the new controls and checks will be achieved through improving information technology and introducing biometric ID for visas and permits.
The working principle is to "export" border controls where possible to stop the wrong people from entering the UK.
By 2014, a system for biometric checks of all those entering or leaving the UK would be in place, ministers said, but the routes most open to abuse by illegal migrants would be targeted by 2008, with most areas covered by 2009. A paper-based system of embarkation records was abandoned in 1994 because of inefficiency.
