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26th March 2020

Hiring workers from overseas – how will it look post-Brexit?.

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Following the UK’s official exit from the EU on 31st January 2020, we are currently in a transition period which will come to an end on 31st December 2020. Until then EU workers are free to live and work in the UK and it is “business as usual” for UK businesses. However, what is the position regarding EU workers who wish to come to the UK to work from 1st January 2021? From this date free movement will have ended and so how will businesses be able to recruit EU workers in the future?

On 19th February 2020 the Government announced its proposals as to the future immigration system which will take effect from 1st January 2021. As suspected, whilst there are some important changes, in essence the points-based systems which applies currently to non-EU workers will be extended to include EU workers. The new system will, therefore, treat EU and non-EU workers equally with the aim of attracting the “brightest and the best from around the globe”.

Points-based system

As with the current points-based system, the new system will require employers to have a sponsor license if they wish to employ workers from overseas. This will mean therefore that those employers that are not already a licensed sponsor shall need to apply for a sponsor licence if they wish to hire workers from outside the UK, and they will need to agree to be bound by a number of duties and responsibilities.

In any event, even if an employer has a sponsor licence this does not enable them to hire an overseas worker into any role that they wish. Under both the current and the new system, the role must meet certain criteria, for example, it must be of a certain skill level and attract a minimum salary.

It is hoped that the new system will encourage a wider range of skilled workers to the UK, in comparison to those working under the current system, to help fill the gap that had been previously filled by the free movement for EU workers. To help with this the following changes have been made to try and make the process simpler and more efficient:

  • The general salary threshold that must be met for a job to be eligible for sponsorship will be reduced from £30,000 to £25,600. Further it may be possible for a role to attract a salary as low as £20,480 if, for example, if it is a recognised shortage role or if the applicant has a PhD relevant to the role.
  • The skills threshold that is required for a role to be eligible is being reduced from RQF 6 (graduate) to RQF 3 (A Level) to include a wider pool of jobs;
  • The current cap on the number of skilled workers who can come to the UK will be suspended; and
  • The resident labour market test, which is a very prescriptive test that employers are required to go through under the current system will be removed.
  • Have a job offer from an approved sponsor (20 points)
  • Have a job offer at the required skill level (20 points)
  • Be able to speak English (10points)
  • Consider what the changes may mean for your current workforce and ability to recruit from outside the UK from 1st January 2021.
  • Bolster local recruitment in areas where business relies heavily on low skilled migration.
  • Audit current EU nationals and, where applicable, support them to gain settled/pre-settled status under the EU Settlement Scheme before new proposals come in.
  • If you are not already a sponsor licence holder but wish to take on skilled workers from outside the UK (whether EU or non-EU) from 2021, start making enquiries into applying to become a licensed sponsor. It is likely that as the implementation date gets closer there will be a large increase in the applications being made and so there may be a delay in the processing of applications. With this in mind, if you wish to become a licensed sponsor you should take action to do so sooner rather than later. Hewitsons can advise employers in relation to the duties of a licensed sponsor, the issues to consider, whether it is right for your business and the application process itself.
  • Review and improve your internal HR processes and procedures. Sponsors and those who apply to become sponsors must show that they have the necessary HR systems in place to meet the requirements that the UKVI impose in terms of record keeping and compliance. The UKVI may therefore undertake a compliance audit as part of, or following, a sponsor licence application being made and so you will need to ensure your HR systems are sufficient. Employers who already have a sponsor licence will also need to ensure that they maintain adequate compliance. Hewitsons lawyers can advise as to your obligations as a sponsor licence holder, including the record keeping and reporting duties required and how best to get your processes in line should a UKVI audit take place.

Under both the current system and the new system, the overseas worker is also required to obtain a number of points before they can be sponsored by an employer to work in the UK. Under the new points-based system, workers will need to score 70 points to qualify for a visa. To obtain these they must:

In addition to the mandatory criteria above, workers must score a further 20 points. This will be achieved if they either earn above the minimum salary threshold of £25,600 or earn at least £20,480 but the role in question is on the shortage occupation list or the worker has a PHD relevant to the job..

The shortage occupation list is a list of roles that are recognised as being in short supply in the UK labour market. The Migration Advisory Committee (MAC) produces the shortage occupation list and will be keeping it under review going forward.

Low-Skilled Workers

The points-based system, even with the skill criteria being lowered to RQF 3, will still only enable skilled workers to come and work in the UK.

With the desire to move away from “cheap labour”, the Government decided against introducing a low-skilled or temporary worker visa category instead stating that employers will “need to adapt and adjust”.

This is not welcome news for charities and sectors reliant on volunteers and low-paid staff, particularly social or residential care which account for almost half of EU workers within the charity sector and where demand for more social care is increasing.

Many roles in social or residential care are low skilled, are not classed as a shortage occupation and low paid so the salary threshold is an issue. Even if such roles would be deemed to be at the requisite skill level (which is doubtful) it is unlikely such workers would get the requisite points given the salary and shortage occupation issue. Add to that the current workforce shortages currently being experienced by social and residential care organisations as a result of chronic underfunding means that the new proposals are a cause of significant concern and could potentially be “catastrophic”, signalling the end of some essential social care services.

MAC have been asked to produce the shortage occupation list covering jobs within the skilled worker route and to keep it under review. It is therefore hoped that social care will be covered as a role on the shortage occupation list in the future.

The Government has suggested that some of the 3.2m EU workers who have applied under the Settlement Scheme can help meet labour demands of the future – we will just have to watch this space to see whether this will in fact be the case.

What should employers be doing to prepare

  • Consider what the changes may mean for your current workforce and ability to recruit from outside the UK from 1st January 2021.
  • Bolster local recruitment in areas where business relies heavily on low skilled migration.
  • Audit current EU nationals and, where applicable, support them to gain settled/pre-settled status under the EU Settlement Scheme before new proposals come in.
  • If you are not already a sponsor licence holder but wish to take on skilled workers from outside the UK (whether EU or non-EU) from 2021, start making enquiries into applying to become a licensed sponsor. It is likely that as the implementation date gets closer there will be a large increase in the applications being made and so there may be a delay in the processing of applications. With this in mind, if you wish to become a licensed sponsor you should take action to do so sooner rather than later. Hewitsons can advise employers in relation to the duties of a licensed sponsor, the issues to consider, whether it is right for your business and the application process itself.
  • Review and improve your internal HR processes and procedures. Sponsors and those who apply to become sponsors must show that they have the necessary HR systems in place to meet the requirements that the UKVI impose in terms of record keeping and compliance. The UKVI may therefore undertake a compliance audit as part of, or following, a sponsor licence application being made and so you will need to ensure your HR systems are sufficient. Employers who already have a sponsor licence will also need to ensure that they maintain adequate compliance. Hewitsons lawyers can advise as to your obligations as a sponsor licence holder, including the record keeping and reporting duties required and how best to get your processes in line should a UKVI audit take place.
For more information on any of the items raised in this article please contact either Lynne Adams on 01908 247025, or click here to email Lynne, or contact Gemma Hill on 01604 463309, or click here to email Gemma.