Immigration after Brexit

Skilled workers

The new system for skilled workers will go live from 9.00 am on 1 December 2020. The Tier 2 (General) route will be closed to new applications from 1 December 2020. Where an EEA national makes an application for entry clearance under the skilled worker route before 11pm on 31 December 2020, any entry clearance granted will take effect from 1 January 2021. An application for leave to remain would be invalid and would be rejected and not considered.

Employers that are not currently approved by the Home Office to sponsor migrants should consider obtaining that approval now if they think that they will want to sponsor skilled migrants from 2021. The process for employers to sponsor migrants is to be made simpler and quicker. The government refers to a reduction in time of up to eight weeks, which will be welcome news for employers.

Migrants will need to obtain a visa, with the exception of Irish citizens, who can rely on the Common Travel Area, and short-term visitors and short-term students who are EU citizens or non-visa nationals. The immigration skills surcharge and immigration health surcharge will be levied on the same basis as now. Applications from EU citizens will be made online using smart phone self-enrolment and most EU citizens will be issued with an e-visa. Non-EU citizens will still need to visit a visa application centre. There will be a firmer approach to criminality across the system when considering applications.

In order to obtain a visa, applicants must:

• Be 18 years of age, rather than the current 16 years.
• Meet a specific set of requirements for which they must score a total of 70 points.

Mandatory characteristics

The mandatory characteristics are non-tradeable and will add up to a total of 50 points. They are to:

• Have a job offer from an approved sponsor (20 points).
• Have a job offer at the required skill level (20 points). The skills threshold is being brought down from the current graduate level to include those educated to the equivalent of A-levels or Scottish Highers. Workers do not need to hold a formal qualification; it is the skill level of the job that the migrant will be doing which is important.
• Speak English at the required level, which is equivalent to AS-level or intermediate (ten points).

Tradeable characteristics

Applicants must obtain a further 20 points from tradeable characteristics; that is, a combination of points for salary, a job in a shortage occupation or a relevant PhD. Applicants can only score from one entry from salary and one from other characteristics.

Salary

In terms of salary, the applicant must, in most cases, earn more than the general salary threshold of £25,600 (lowered from the existing £30,000) and at least the "going rate" for the profession (20 points). The going rate for a civil engineer is, for example, £35,000. An applicant with a salary of less than £25,600 but at least £23,040 and at least 90% of the going rate for the profession scores 10 points. Lastly, if a migrant earns above the minimum floor of £20,480 and at least 80% of the going rate for the profession he or she will score 0 points for salary (but can still score 20 tradeable points for other characteristics to be eligible for a visa).

The going rate salary threshold for new entrants, for example, migrants who are switching from a student or graduate route, under the age of 26 on the date of application, working towards a professional qualification or moving directly into postdoctoral positions, will be 30% lower than the going rate for experienced workers in any occupation, though the minimum floor of £20,480 must always be met. In addition, the general salary threshold will be reduced by 20% for new entrants.

A small number of occupations in the health and education sectors will have a going rate salary threshold based on published pay scales and need to pay at least the minimum floor of £20,480.

Other tradeable characteristics

These are:

• A PhD in a subject relevant to the job (10 points).
• A PhD in a science, technology, engineering or mathematics (STEM) subject relevant to the job (20 points).
• A job in a specific shortage occupation as designated by the Migration Advisory Committee (MAC) (20 points). MAC has recommended that the specific shortage occupations are expanded to cover 70 new roles, although the government, controversially, has not yet implemented this recommendation as it wishes to first assess how the UK labour market develops post-Covid 19 and in response to the introduction of the new Points-Based Immigration System.
• The applicant is a new entrant to the labour market as designated by MAC (20 points).

The government retains the ability to widen the number of tradeable attributes that will score tradeable points to enable it to meet the needs of the economy.

Possible advantages

The overall cap on the number of skilled workers who can come into the UK under the skilled worker route will be suspended and the resident labour market test will be abolished. The role will, of course, still need to be genuine and the system cannot be used merely to facilitate the immigration of a specific migrant to the UK. There will be no cooling-off period so the visa holder will not have to leave the UK for 12 months before applying for a new visa. Also, the six-year maximum stay for most migrants under the current system will be removed so applicants can be granted permission to stay for up to a maximum of five years at a time, with unlimited extensions. Many applicants will also be able to switch to this type of visa while remaining in the UK, which is a welcome change.

Under the intra-company transfer visa, transferees will be permitted to switch into the skilled worker route, if eligible. Employers will benefit from a relaxation of the cooling-off period provisions which will allow more flexibility and short-term assignments.

In view of all these changes, it could be argued that the UK’s points-based immigration system will be more user friendly, and provide greater flexibility and benefits for employers in the UK to employ migrants from overseas compared to what is provided currently through Tier 2 of the points-based system (see feature article "Immigration law: the points-based system in practice", www.practicallaw.com/9-640-9106).

Potential drawbacks

Significant concerns remain about whether the system will create a skills shortage in the UK and it goes without saying that it is much more restrictive than EU free movement rights. The sponsorship system is obligation heavy and very expensive, and the cost will increase further with the increase in the immigration health surcharge.

There is no provision for visas for roles that do not have a corresponding Standard Occupational Classification (SOC) code which meets the relevant skill and salary thresholds. If the job for which a sponsored worker is required is a closer match to one of the SOC codes below the required skill level or if the salary to be paid is too low, then a sponsor would not be able to employ a sponsored worker in the role.

The general salary thresholds cannot be pro-rated for part-time workers as they are viewed as a measure of the economic contribution that an applicant will make to the UK. Going rates can, however, be pro-rated for different work patterns. In addition, only base salary is used to determine if the salary threshold is met; cash allowances and pension contributions are discounted. There are no regional salary thresholds and, to put that in context, the typical full-time annual salary in Scotland is around £24,500 so it might be more difficult for companies to sponsor workers in some regions of the UK because salaries are on average lower than in the South East. The requirement to speak English may also pose an issue for some migrants.

Highly skilled workers

The UK’s Tier 1 (exceptional talent) route was rebranded to Tier 1 (global talent) route on 30 January 2020. This route has no cap in numbers. This route was recently expanded to be more accessible for those from STEM backgrounds. From January 2021, the government proposes to extend the current global talent route to EU nationals on the same basis as non-EU citizens, so these migrants will be able to come to the UK without a job offer if they are endorsed by a relevant body.

UK employers should also note the introduction of the unsponsored graduate immigration route for two years after the award of a degree, as well as the doctorate extension scheme.

In the future, in line with the recommendations by MAC, the UK will also create a broader unsponsored route within the points-based system to run alongside the employer-led system. This will allow a smaller number of the most highly skilled workers to enter without a job offer. This route would be capped and take longer to implement; it is expected to open in 2022.

There will, however, be no dedicated route for self-employed people. These individuals may benefit from the global talent, innovator or start-up routes or, potentially, under the proposed unsponsored route. The UK’s new system may provide employers in the UK with a greater potential pool of highly skilled labour. However, it is not certain whether it will be able to plug the skills shortage that may arise after the end of free movement of people. This is particularly due to: the delayed implementation of any unsponsored route for highly skilled migrants without a job offer; the endorsement process required for the global talent, start-up and innovator categories; and the limited number of migrants that the global talent route is aimed at (only the most talented people from around the world).

Low-skilled workers

The government's decision not to introduce a general low-skilled or temporary work route has received a great deal of press attention. The government’s view is that UK employers should move their focus away from cheap labour from Europe. Employers must adjust, invest in technology and automation, and meet their requirements for low-skilled workers by relying on the retention of the existing workforce through the EU settlement scheme as well as on dependents of points-based system migrants.

One area where the government has permitted low-skilled temporary workers is in agriculture, where the number of places available for seasonal workers has been quadrupled to 10,000.

The government also points to the availability of youth mobility arrangements which allow 20,000 young people to come to the UK each year. It intends to conclude further youth mobility arrangements with other countries and territories in the future.

The decision not to implement a route for lower skilled workers will cause concern for certain sectors in the UK that are heavily reliant on lower skilled EU migration, such as the food and drink, manufacturing, warehousing, accommodation and hospitality, construction and retail sectors. Many UK companies are asking whether there will be enough low-skilled labour in the UK. It is unlikely that the removal of the migration cap, and the lowering of the salary and skills thresholds will ease this for employers to the extent which may be required. The government’s view is that the gap can be plugged by training the 8.5 million people who are currently categorised as economically inactive.

Employment costs may also rise as companies are forced to increase the wages of lower skilled roles to attract local, settled workers for roles that were previously filled by EEA nationals who were more willing to accept a lower wage. This could increase the risk of illegal working and unscrupulous working practices, particularly among smaller employers as they struggle to meet demand and cannot afford to increase wages, increasing their reliance on a vulnerable and unstable workforce.

It remains to be seen whether the new immigration measures will provide UK companies with easy access to migrant workers, both in terms of numbers and skill levels once free movement of people ends and, in turn, what impact this will have on the UK’s economy.

Future impact

It remains to be seen whether the new immigration measures will provide UK companies with easy access to migrant workers, both in terms of numbers and skill levels once free movement of people ends and, in turn, what impact this will have on the UK’s economy.

Migration patterns

Figures from the Office for National Statistics reveal that, notwithstanding the government’s stated intention to reduce net migration to below 100,000 per annum, in the year ending March 2020, long-term international migration continued to add to the UK population by 313,000. Since 2016, overall migration levels have remained broadly similar; the recent increase is explained by an increase in non-EU student arrivals, mainly from China and India.

However, the migration pattern is different for EU and non-EU citizens. EU net migration had been previously falling following peak levels of 200,000 per annum in 2015 and 2016. More recently, EU net migration has stabilised and stands at 58,000 in the year ending March 2020. Non-EU net migration, on the other hand, has been gradually increasing since 2013 and, as at the year ending March 2020, is at some of the highest levels seen since records began for this group in 1975. An estimated 316,000 more non-EU citizens moved to the UK than left in the year ending March 2020.

Lauren Pullen-Stanley is counsel in the employment team at Norton Rose Fulbright LLP.

This article first appeared in the December 2020 issue of PLC Magazine: http://uk.practicallaw.com/resources/uk-publications/plc-magazine.