The Home Office is facing a High Court challenge over the "mistreatment" of people applying to renew and extend their visas.
A judicial review challenging the Government’s actions towards hundreds of thousands of people with the immigration status known as "3C leave" has been launched by the Refugee and Migrant Forum of Essex & London (RAMFEL).
The status is granted automatically to those applying to extend their visas, and ensures that their rights, including the right to work, are protected while the application is processed.
However, RAMFEL says the Government does not give people on 3C leave proof of their immigration status, and this means they spend the period they are waiting to learn if their renewal has been successful with "no proof of their status, rights and entitlements".
The charity argues that some applications are taking at least a year because the Home Office has re-allocated significant resources towards clearing the asylum backlog.
It has reported its clients have been wrongly suspended from work, seen disability benefits stopped and education jeopardised.
RAMFEL found that in 2022 17 per cent of those on 3C leave suffered serious detriment and predicts as many as 40,000 people each year could be facing wrongful suspension from work.
Yvonne Atieno from RAMFEL experienced time on 3C leave herself. She said: “Many employers and jobcentre employees do not understand 3C leave and insist on seeing physical visa document.
"Without physical proof you are left in limbo, basically allowed to stay in the UK but you have no rights.
"You start getting anxiety every 2.5 years when your visa renewal is approaching.
"The uncertainty affects families in more ways than one. Innocent children suffer when there is no lifeline for their parents and families can be forced into destitution as a result.
"It would make such a huge difference if after making your visa application you are given some form of documentation explaining and proving your rights while waiting for the government to process your case."
In November the Standard reported how an Essex mother of two, who has lived in the UK for 16 years, could not switch jobs and her daughter could not begin pharmaceutical studies while they waited up to 12 months for the Home Office to process their visa applications.
The supermarket worker, who only wanted to be identified as Ajibola, said her eldest daughter was offered a place at university but could not access student finance, and had been repeatedly turned down by employers, while she waited for her next visa to continue living in the UK.
She was one of roughly 170,000 people - including many single mothers working part-time while raising their British children - on a 10-year route to settlement who faced visa processing times of 12 months, migrant advocates said.
A Home Office spokesman said: “Individuals who have submitted an application for further leave in the UK before their existing leave has expired must not be discriminated against.
"There are a range of channels by which a person's entitlement to employment, study and other benefits can be confirmed and we expect employers and others who need to check immigration status to use them.
“We do not comment on ongoing legal proceedings.”
The High Court will consider whether the Government’s conduct is unlawful during a two-day hearing in March.
The Prime Minister has been under increasing pressure to tackle the record numbers of unprocessed asylum claims.
On January 1 Rishi Sunak said he had met his 2023 pledge to deal with more than 92,000 cases by plunging Home Office resources into the backlog.
But within this number predating June 2022 are 35,119 people removed from the backlog who were neither rejected nor accepted as refugees.
Instead, the Home Office withdrew most of these applications after being unable to find the applicants or alleged non-compliance with rules.
This has also led to people being limbo, evicted from supported accommodation and cut off from financial support, according to immigration lawyers and charities.
