A firm could face a fine of up to £20,000 for employing an illegal worker.
Immigration officers raided bed and bedroom furniture company Joseph Furniture Ltd, based at Express House in Station Road, Bradley.
Officials from the Home Office immigration enforcement team raided the premises at 8.45am yesterday.
There had been reports that the firm was employing illegal workers.
During the raid staff were questioned over their immigration status.
A Home Office spokesman said: “A 24-year-old Pakistani man was arrested on suspicion of overstaying his visa. He is now detained pending further investigations into his case.
“If he is found to be in the country illegally he faces removal from the UK.”
The spokesman said Joseph Furniture Ltd would be served with a notice warning that a financial penalty of up to £20,000 could be imposed unless the firm could prove that proper work checks were carried out.
Employers should see a Home Office document or a passport.
Anita Bailey, deputy director at Home Office Immigration Enforcement, said: “Businesses in Huddersfield who employ illegal workers are defrauding the treasury of vital funds, undercutting employers who ply an honest trade and cheating legitimate job seekers out of employment opportunities.
“We are happy to work with those who want to play by the rules but employers who break the law will face the consequences.
“People with detailed and specific information about suspected immigration abuse should contact us.”
Mr Ashraf Esa, director of operations at Joseph Furniture Ltd, said it was not a raid on the firm but a “raid on individuals.”
He said the officers were looking for named people, three of whom worked at the firm.
He said the firm carried out all the necessary checks but the arrested man’s visa had been cancelled.
“If a visa is cancelled how can we know about it?” he said.
The firm employs 48 people.
Information to help employers carry out checks to prevent illegal working can be found at www.gov.uk/government/collections/employers-illegal-working-penalties .
It includes a new quick answer right-to-work tool to help employers check if someone has the right to work in the UK.
Anyone with information about suspected immigration abuse can report it at www.gov.uk/report-immigration-crime or via Crimestoppers on 0800 555 111.