The implications are that the individual will have no lawful immigration status in the UK, and over time they will find it harder and harder to access services, for example open a bank account, get a mortgage, access NHS healthcare etc.
In terms of the employer, they are not required to carry out follow-up checks on EEA citizens who were employed on or before 30 June 2021 who presented their passport or national identity card as evidence of their right to work.
Employers will maintain a continuous statutory excuse against a civil penalty if they carried out a right to work check as set out in the guidance at the time of employing the individual.
It is the EEA citizen who has not applied to the EU Settlement Scheme by 30 June 2021 (if eligible) or does not hold any other form of leave, who may be liable to enforcement action by the Home Office. That is because they will be in the UK without lawful status and will not have a right to work.
Further guidance on right to work checks for EEA citizens is expected after 30 June 2021