Recruiters need to prepare for the overhaul of immigration legislation on 29 February if they are to avoid fines and the risk of losing their reputation, according to employment law specialist Lewis Silkin LLP.

If a firm is fined it could also lose the right to recruit from outside the European Union under the changes.

The law, which includes a points-based system for new immigrants, provides employers with a statutory defence from conviction if they check and record documents such as passports.

Under the new rules, employers will be similarly protected but they will be required to undertake repeated checks at least once a year for those employees who have the right to enter or remain in the UK for a limited period of time.

Nicola Appleton, head of immigration for Lewis Silkin LLP, told Recruiter: "Those employing non-EU foreign nationals will have to be licensed with the Home Office and will have to demonstrate they have checked their employees are legally allowed to stay in the UK, and check their addresses and phone numbers are correct at least every 12 months.

"Bosses knowingly hiring illegal workers face fines of up to £10,000 and up to two years in prison. I recommend six-month checks so you can prove to employers you are on top of this."

Appleton advised temp agencies tempted to get administrative assistants to help with the extra workload to have files checked by a director.

She also warned agencies and employers that a work permit must contain the correct work address, as well as precise job and client details.

Appleton warns that firms supplying cleaners will be specifically targeted by immigration officials.

She said: "I know of a case where the officials checked through company records while they were at the premises, even though the company did not directly employ the cleaners."

An official helpline has been set up on 0845 010 6677.