Government confirms changes to the UK immigration system from 1 January next year

19 February 2020

As anticipated in our blog last week, the government has today set out the initial details of the new UK immigration system policy which will apply from 1 January 2021.  These changes are important as they will affect the way in which you recruit EU citizens from next year.

Timing of implementation

The changes announced today are phase 1 of the government’s plans from 1 January next year.  The government has stated that it intends to open new key routes from as early as this Autumn, in order that employers have time to prepare for the changes taking effect from the start of next year. Phase 2 of the changes, particularly in relation to the Global Talent category, will be announced next year.

Changes to recruitment of skilled workers under Tier 2 – from 1 January next year

For EU citizens resident in the UK before the end of this year, they can continue to register under the EU Settlement Scheme before the 30 June 2021 deadline.  
For EU citizens arriving in the UK after the start of next year, they will need to apply for prior permission to work in the UK.  Tier 2 (or an equivalent new category) for skilled workers will broadly stay the same as has been in place since its introduction in 2008 for non-EU citizens.  As previously stated by the government and the Migration Advisory Committee (MAC), the government will make the following important changes to Tier 2:
  • The same system will apply to both EU and non-EU citizens. 
  • The skills threshold for Tier 2 will be reduced to include ‘medium skilled’ occupations known as Regulated Qualifications Framework (RQF) level 3 (equivalent to A-level), down from level 6 (equivalent to degree level).
  • The resident labour market test (RLMT) advertisement process will be abolished.
  • The numerical cap on the number of Tier 2 (General) applications will be suspended.

Points scoring

The new Tier 2 (or equivalent) category will require applicants to achieve 70 points, much the same as is currently the case for non-EU citizens.  All applicants must achieve 50 points in the following compulsory criteria:

  • The job must be at an appropriately skilled level (RQF level 3).
  • The job must have been offered by an employer with a sponsor licence.
  • The applicant must be able to speak a good level of English.
  • The salary must be at least £20,480 (and above the ‘going rate’ for the type of job).

In order to score the remaining 20 points, many applicants will achieve that by:

  • Having a salary of £25,600 or above (and above the ‘going rate’ for the type of job).

Where the individual will be paid less than £25,600, they can achieve the remaining 20 points in one or a combination of the following ways:

  • 10 points: salary of £23,040 – £25,599 (and above the ‘going rate’ for the type of job).
  • 10 points: PhD in a subject relevant to the job.
  • 20 points: PhD in a science, technology, engineering or mathematics (STEM) subject relevant to the job.
  • 20 points: job in a shortage occupation (the list is to be confirmed by the MAC via a new government commission).

The policy paper states that lower skilled/income roles which do not meet the points scoring criteria will not qualify and that “UK businesses will need to adapt and adjust to the end of free movement.”

Other changes to salary requirements

The government has also confirmed the following on salary levels:

  • As has been the case under Tier 2, applicants must be paid the higher of the Tier 2 category minimum threshold and the ‘going rate’ for the type of job.  If the applicant has a relevant PhD in a non-STEM subject the ‘going rate’ can be 10% lower, or if they have a relevant PhD in a STEM subject or the job is in a MAC designated shortage occupation it can be 20% lower.
  • Only the basic salary amount will count towards the points criteria, not allowances.
  • As is currently the case under Tier 2, there will be a lower salary threshold for those considered to be new entrants (based on their age or for example because they are switching into Tier 2 after completion of a degree in the UK).  The policy paper states the new entrant salary rates will be 30% lower than those for experienced hires.
  • There will no regional variation in the salary thresholds.

Important practical implications

You should bear in mind the following key practical implications of these changes:

  • You should review your current relocation packages for your Tier 2 (ICT) staff who are planning to transfer on or after 1 January 2021 to ensure their basic salary meets the minimum level required without including allowances.
  • Given the need for EU citizens to apply for visas to work, there will be an increase in costs from the Home Office visa fees.  The Immigration Skills Charge (up to £1,000 per year of the visa) and Immigration Health Surcharge (currently £400 per year for each applicant and their family members) will apply to EU and non-EU citizens.
  • Consideration will need to be given to the time it will take for EU citizens to apply for visas before being able to work in the UK.
  • EU citizens will be able to visit the UK for up to 6 months, much the same as is currently the case for non-EU citizens.  Visitors are not permitted to work in the UK.
  • On right to work checks, the policy paper confirms you can continue to accept EU passports and national ID cards until 30 June 2021.
  • Non-EU citizen visa applicants will continue to provide their biometrics (including a digital photo and fingerprints) at visa application centres in their country of application.  EU citizens will be able to upload a photo of their face (a ‘selfie’) using their smartphone and will not need to attend a biometrics appointment as part of their application.  That will hopefully streamline the application process for EU citizen applicants.
  • As you will be required to sponsor EU citizens under your existing sponsor licence, the need for full compliance to avoid the licence being revoked and sponsored workers’ employment being terminated has never been more important.  For employers without a sponsor licence, they should apply as soon as possible as the Home Office is likely to receive a surge in applications throughout the rest of the year.

The policy paper raises a number of questions about how these changes will be implemented in practice.  We will be working with UKVI to provide feedback and suggestions on various areas of the new policy.  If you have any queries on these changes or any other immigration related matter, please do not hesitate to contact a member of the immigration team.  We will continue to keep you updated on immigration changes affecting your business.

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