Police arrested a business owner and seven foreigners working illegally after a raid on an establishment in Protaras.
In a joint operation after a tip off with the labour ministry which is part of a campaign to tackle illegal employment, they also issued fines totalling €16,000.
The documentation of 136 workers employed by 33 employers in hotels in the area was checked on Monday.
The seven foreigners were arrested during the raid and the 37-year-old man who employed them shortly after midnight on Tuesday.
Their employer, a 36-year-old Palestinian, was remanded for eight days for hiring the men to carry out renovation work for a Protaras hotel.
Famagusta district court also remanded four of the employees for four days. The three are Egyptians aged 24, 34 and 39 and one is from Syria, aged 37.
Three had entered the country illegally and one had overstayed their visa.
The remaining three employees were released after it was found they live in Cyprus legally.
According to new legislation that has been in force since last September, employers are fined €500 for each illegal employee, going six months back, bringing the total possible fine per illegal worker to €3,500.