Some 7,000 UK security workers have been banned from further work in the industry after an investigation found they were illegal immigrants.
Jacqui Smith told the Commons about the figures in December
Home Office minister Vernon Coaker said the Security Industry Authority had revoked 7,000 licences and 3,000 people were challenging a decision.
Some of the workers are now being prioritised for removal from the UK.
The problem emerged after an operation last year found 44 security workers did not have the right to work in the UK.
MPs heard in December that up to 11,000 people may have been wrongly cleared for security jobs.
'Failing to comply'
In a written statement to the House of Commons on Thursday, Mr Coaker said the decision to revoke 7,000 licences came after Border and Immigration Agency investigations at workplaces where Security Industry Authority (SIA) checks suggested "repeated use or significant presence of illegal migrant workers".
The focus was on cases where employers had "blatantly failed to comply with the law on the prevention of illegal working" and where individuals had committed criminal offences, he said.
"Individuals with adverse immigration records or who may pose a risk to the public are being prioritised for removal," he added.
The problem with illegal workers in the security industry emerged after an enforcement operation in April last year.
Of the 44 people working at a security company who did not have the right to work in the UK, 12 had been sub-contracted to a company that provided staff to guard locations under Metropolitan Police contracts.
Others were employed at ports and airports, and one man had been guarding government cars including the prime minister's.
'Double lock checks'
The SIA was set up to vet applicants for security jobs and allows those who are successful to work on pub and club doors as well as in sensitive security posts.
An SIA licence shows a successful applicant has undergone training, plus identity and criminal record checks.
The responsibility to prove someone is entitled to work in the UK rests with employers.
Since 2 July last year the SIA has introduced new immigration status checks to provide a "double lock" on illegal working.