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Mapping the Future of Immigration and Employment

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by Dawn Ford - Legal Counsel

On 19 February, the Government published its latest policy statement on how the “new” UK “points based immigration system” will work.  To answer a couple of obvious points of confusion at the outset, it’s not really new – in the main it looks a lot like the current Tier 2 visa system - and it doesn’t really talk about points.  But what it does provide is a much clearer view of what UK immigration will look like from 1 January 2021.


From the outset it was always likely that the Government would try to piggy-back whatever new immigration plans they envisaged onto the existing laws.  Since the Migration Advisory Committee only reported back with their suggested next steps on immigration in January 2020 and the Government needs whatever the new system is up and running by the autumn of 2020 to make sure new work permits can be issued in time for January 2021, there was clearly going to be no time to create an entirely new process or application system.


Given the current Tier 2 process requires the employer company to hold a sponsorship licence and the policy paper says, “Employers not currently approved by the Home Office to be a sponsor should consider doing so now if they think they will want to sponsor skilled migrants, including from the EU, from early 2021” – we can be pretty sure of the direction of travel.


So, for those who didn’t live through the last major upheaval to the immigration laws in 2008, here’s a couple of quick reminders about the current Tier 2 system.  Firstly, it’s an employer-led visa system – in other words the employer issues the work visa.  And secondly, in order to issue a work visa, the employer has first to have obtained a licence (a “sponsorship licence”) from the Government which permits them to sponsor a non-UK national to come and work in the UK.  The major complaint the recruitment industry has about this system (and this policy paper looks set to leave this issue unanswered) is that every time you change jobs, you’ll need a new work visa and the work visa needs to be issued by the company you’ll be providing services to – which means that you can’t use Tier 2 visas in the temp recruitment sector.


If, as a company, you think that without a steady stream of available EU candidates you might need access to such a visa system, now would be a great time to get registered as a sponsor. While it doesn’t take long, it’s likely there’ll be a panic to register later in the year and you don’t want to hold up your future hiring needs through lack of administrative attention now.  You can find out more about registering as a sponsor on this Government website, although note it hasn’t yet been updated to reflect the Government’s predicted changes to immigration:


So accepting that the new visas for EU nationals are likely to look very like the current Tier 2, let’s now look at how Tier 2 will be changing.

Firstly, the general salary threshold will be reducing from £30,000 to £25,600 or if the role is on the Shortage Occupation List (SOL) or the candidate has a relevant PhD, (especially if that PhD is in a STEM subject) then the salary threshold will in fact be £20,480.  (Please note that this doesn’t change the basic principle that a specific job role, like an IT project manager, might have a job specific salary threshold that is higher than that).  There will also be a different pay scale for certain job roles, such as nursing, where the salary threshold will be set by reference to a published pay scale (and so could, theoretically, be lower still).

Looking at skills, where previously a graduate level qualification would be needed (so-called RQF 6), this has now been reduced to an A-level equivalent qualification (RQF 3).  This does of course mean that there is no visa option for workers with qualifications below this level.

One of the major complaints that employers make of the current system is the Resident Labour Market Test (RLMT) where they have to show that they couldn’t find a qualified candidate in the UK before advertising the role abroad.  This is being abolished.  This, in turn has an impact on the Shortage Occupation List (SOL) which has historically presented employers with a “get out of jail free card” – if the job role you were recruiting for was on the SOL, then no RLMT was needed.  But the SOL is not without purpose – it continues to regulate which job types will be eligible for the lowest general salary threshold of £20,480.  It’s also worth stating that when the SOL was substantially extended in 2019, the Migration Advisory Committee strongly hinted that a further extension would be required ahead of the 1 January 2021 deadline, so it looks like that lowest salary threshold may have wider use than the title “Shortage Occupation List” might suggest.

And side by side by that, the current £20,700 cap on Tier 2 visas has been suspended. So, from 1 January 2021, there will be no limit on how many Tier 2 visas can be issued (although note it’s been suspended, not abolished, so it’s an open door for the Government to attempt to reduce net migration again at some later point).

As had been widely touted in advance, English language skills will be a requirement of the updated Tier 2 visa model – but that’s a bit of a moot point, because 15 years of working in the industry later – I’ve never seen a job role for work in the UK that didn’t require English language skills.  However, in strict legal terms this is a change because the current Tier 2 ICT route doesn’t require specific language skills.

Other than the obvious problem that Tier 2 visas aren’t open for temp recruitment and having to complete a visa process does slow down the hiring process, by all accounts, this is a much more open playing field for immigration than last year’s press coverage might have led you to believe.  Although it’s also worth stating that the last election was won by the Tories on the back of a “controlled” immigration policy.  ‘Control’ indicates visibility. It doesn’t necessarily mean reduction. But I think a reduction is still expected.

Firstly of course because administration is a pain and everyone would prefer not to do it.  If you’ve got to pay a fee to get a licence, then check the candidate is eligible for the licence and then have a process for ongoing checks to ensure the candidate remains eligible with the requirements, some clients are going to start banging on the door of their training teams and asking if there’s a better way of reaching the same outcome.

Then there are the fees.  Putting aside for the moment the fees that have to be paid to get a sponsorship licence in the first place, once an employer hires a candidate via a Tier 2 visa they’ll then need, in most cases, to pay the Immigration Skills Charge, which is £1000 per annum for every year of the visa, plus the Immigration Health Surcharge of £400 per annum.

On the positive side, there’s a strong hint in the policy document that something like the old Tier 1 (General) visa might be re-introduced as an option for highly skilled workers.  Clients and agencies would both cheer if this happens, because that type of visa not only allowed the worker to come to the UK without a job offer, but it was the worker that bore the cost and admin of applying for it. As a result, for clients and agencies alike, the worker is an immediately available and valuable resource, able fill both temporary and permanent positions.  Now, while the Government has said they’re not looking to introduce a route specifically for self-employed people, realistically, this was the demographic that used the Tier 1 (General) route extensively – so such a plan may not be “designed” for them but it will certainly be of benefit to them if it comes.

So for now, it’s back to analysing data and planning.  Where are your skills shortages?  Are those roles on the Shortage Occupation List?  Do you have a sponsorship licence?  Do you need to apply for one?  There are still many questions to answer, but at least the direction of travel is now mapped out.