No-deal Brexit: Should employers sponsor their new EU staff?

12 March 2019

The prospect of the UK leaving the EU without a deal has caused a great deal of uncertainty, not least among EU nationals who are considering a future move to the UK for work. How can UK employers provide reassurance to these prospective employees that their status will be secure?

The UK government has proposed that, in the event of no deal and no transitional period coming into force, a new temporary migration regime will be put in place for EU nationals arriving after 29 March 2019.  This regime will remain in place until 31 December 2020, when it is anticipated that a new comprehensive immigration regime will come into force for all those wishing to come to work in the UK. 

Under the no-deal scenario, EU nationals arriving after 29 March 2019 will be able to work, study and reside in the UK.  However, if they intend to remain in the UK beyond three months they will need to apply for a new European Temporary Leave to Remain (ETLR) status.  Once approved, ETLR will be valid for 36 months.                                   

However, the proposals provide very little certainty for both employers and their prospective EU employees looking to move to the UK for work after 29 March 2019. This is because the proposal specifically states that any time spent with an ETLR status in the UK will not count towards any form of settled or indefinite leave or permanent residence.  In addition, at the end of the 36 months with ETLR, the Government has indicated that EU nationals will need to apply to remain under whatever rules are in place from 1 January 2021. 

Understandably, prospective EU employees are asking what certainty their potential UK employers can provide to guarantee that they (and their families) will be able to stay in the UK long-term.  That sense of uncertainty, together with the overall political and economic uncertainty which is itself causing many EU nationals to leave the UK, means that often highly sought-after talent may be reluctant to move to the UK.

So what can employers do to persuade these highly talented individuals to come to the UK?                                                         

In the absence of any certainty and if the UK leaves with no deal, we are now recommending that employers should at least consider sponsoring EU employees under Tier 2 of the points based system.  There are clearly additional bureaucratic hurdles and cost issues which need to be taken into account.  Some employers may not hold a sponsor licence and may need to apply and set up immigration-compliant HR policies and systems. Vacancies will need to be advertised in accordance with UKVI requirements for undertaking the resident labour market test and the recruitment, shortlisting and selection process will need to be well documented to demonstrate clearly that there are no suitable alternative candidates. 

Employers will have to pay significant fees of up to £8,500 to cover visa fees, the immigration skills charge and immigration health surcharge for the employee for a five year visa. If the EU employee is bringing family, there will be additional fees. Finally, the Tier 2 system currently requires all those seeking entry on this basis to apply for a visa which would need to be applied for abroad.

Tier 2 does not provide a magic bullet for all cases.  Many EU nationals may not be sponsored if the roles they are undertaking fall below the current degree-level skills threshold of Tier 2.  The costs of sponsoring EU nationals and their families may well be prohibitive in many cases.  But for highly talented and valued individuals, particularly those who are high earners and exceed the £159,600 annual salary threshold (at which point the RLMT and advertising are not required), Tier 2 may be an option if employers are in a competitive market where employers are fighting each other to secure the best talent.

Is this a hammer to crack a nut? Possibly. But being open to this option may enable employers to positively answer a very simple question which many highly skilled and talented EU nationals are asking: “Can you guarantee I can stay to work in the UK if I arrive after the UK leaves with no deal?”          

This article was first published in PM Daily on 12 March 2019.                               

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