How the UK’s immigration system will change when free movement ends
Samar Shams considers the government’s plans for a points-based immigration system once the UK fully withdraws from the EU. Samar Shams is a partner in the immigration and global mobility team at Spencer West.
This article first appeared in the March issue of Employment Law Journal, published by Legalease.
The ending of freedom of movement is a historic event catalysing changes in the UK’s immigration landscape. The UK is now in the post-Brexit transitional period until 31 December 2020. Within that time, the government will develop its plans for a future immigration system, to be effective from 1 January 2021. Non-UK nationals, including EU nationals, wishing to travel to the UK after that date will be subject to the new system. This article outlines the likely components of this future immigration system. Some visa routes may only undergo slight modifications, but their effects will be significant.
Entrepreneurs
The routes for entrepreneurs are likely to undergo the most change, with good reason. Existing routes for entrepreneurial migrants to come to the UK without a job offer are extremely narrow. They include the Global Talent route and the Innovator route. The Migration Advisory Committee (MAC) has identified the Global Talent route as a candidate for the government’s points-based-system aspirations.
The Global Talent route currently requires endorsement by Tech Nation, Arts Council England or one of a few other bodies approved for particular industries. The MAC has assessed the Global Talent route (previously ‘Tier 1 Exceptional Talent’) as a failure, based on low uptake: only 600 of the 2,000 visas annually available are granted. This is mostly due to eligibility requirements for endorsement being extremely high. Nomination for an Academy Award is an example of a qualifying criterion for a migrant in the film industry.
If the Global Talent route is a failure, then the Innovator route is a washout. The Innovator route replaced the Tier 1 Entrepreneur route in March 2019 and in the first six months of its operation, only 12 applications were approved.
According to the MAC, a modified Global Talent route might operate as follows: individuals interested in applying would register their interest by completing a profile, thereby entering a pool of candidates. By allocating points to candidates based on characteristics such as age, qualifications, having studied in the UK and high-value skills, the UK would rank candidates and invite those with the highest points to apply for a visa. The MAC suggests that English language ability be a strict requirement rather than a characteristic that might be awarded points.
The proposed points-based visa could address the current lack of options for those wishing to set up in business in the UK, as the route would be likely to allow for self-employment as well as employed work.
Skilled workers with job offers
The current system of UK employers applying for sponsor licences and then assigning work authorisation to skilled migrant workers to whom they have offered jobs will be maintained, with some modifications. This visa category is called Tier 2, though the name is likely to change.
There remains some ambiguity as to what changes will be made. The government proposed to introduce a points analysis into the sponsored skilled worker visa routes but the MAC has advised it not to. The government usually implements the MAC’s recommendations, but is not obliged to do so. [Author’s note: Since this article went to print, the government has confirmed plans to introduce a points analysis into the sponsored skilled worker visa route, against the recommendations of the MAC. You can read more about the government’s confirmed policies in my HRZone blog on the topic.]
Tier 2 consists of two subcategories, one for new hires and one for employees transferring from overseas entities that are linked to the UK employer, for example through shared ownership. There are few changes proposed for the second, Intra Company Transfer subcategory. However, a number of elements of the first subcategory, Tier 2 General, will change in the future immigration system.
Firstly, the government will maintain minimum salary levels but they will be lower to accommodate the inclusion of medium-skilled roles in the sponsorship system. Currently, sponsors can only fill highly skilled roles (graduate level and above) through Tier 2 General. The proposal is to lower the skill level of eligible roles to the equivalent of A-level or above. The MAC suggests taking medium-skilled roles into account by setting new minimum salary levels at the 25th percentile of salaries for all roles that will be eligible for sponsorship. Based on 2019 figures, the effect would be to lower the Tier 2 General salary threshold from £30,000 to £25,600.
Sponsors would also still have to meet salary thresholds specific to the roles for which they are sponsoring skilled migrants. These job-specific thresholds might be higher than the proposed £25,600 general threshold for the category.
In addition, the government has proposed abolishing the annual limit of 20,700 migrants in this category who earn less than £159,600 a year. The cap itself usually has little effect on limiting numbers of migrants. It has only been reached twice and both times the Home Office eventually relaxed the requirement rather than allowing it to continue to frustrate employers’ efforts to sponsor skilled workers from overseas. The more significant effects of the cap are the complicated and time-sensitive processes that employers must follow before assigning work authorisation to a skilled migrant. They have to request allocation of a work authorisation under the limit, after advertising and before the 5th of any given month, then wait until the 11th of the same month for a decision on their request. The change therefore represents significant streamlining of the Tier 2 General sponsorship process.
Another government proposal for streamlining Tier 2 General is to abolish the advertising requirement for most sponsored workers. Fulfilling the Resident Labour Market Test through advertising a role for 28 days is intended to force employers to recruit UK settled workers before sponsoring a skilled migrant to fill a role. In practice, it is another element that has little effect, other than to add time and complexity to the sponsorship process.
Other changes to Tier 2 relate to the ‘new entrant’ salary thresholds, which are lower than the regular thresholds. These new entrant rates can be used by students switching to a sponsored worker visa, applicants under 26 years old and those being sponsored for particular graduate roles. The MAC proposes reducing the salary threshold for new entrants from £20,800 to £17,920. Job-specific new entrant thresholds would still have to be met. The MAC also suggests that the new entrant rates apply for 5 years instead of only 3 as they do currently.
Work routes for graduates and young people
Overseas nationals graduating from UK degree programmes in 2021 or later may be eligible for a new Post-Study Work route that will be introduced that year. Under that route, they may be eligible to stay in the UK for two years after graduating, to work or look for work.
The current Youth Mobility Scheme is similarly a two-year route. It is only open to 18- to 30-year-olds from a handful of countries at the moment. The government has proposed expanding the route to include further nationalities.
Low-skilled workers
A gaping hole exists where a viable plan for low-skilled workers and the UK sectors that depend on them should be. The MAC recommends that the government consider a temporary work route for all skill levels to address the need for low-skilled workers. However, the government has indicated that it has abandoned its proposal for such a route. It had previously outlined the route in the Immigration White Paper published in December 2018.
The agriculture and food and drink industries rely on low-skilled work and have a relatively high proportion of EU nationals in their workforces. The MAC believes that the EU nationals currently in low-skilled work in the UK will remain and that their family members will join them, which will be sufficient to meet labour demands. However, available data indicates an increase in EU nationals’ emigration from the UK and a fall in EU net migration to the UK since 2016.
The government envisions a sector-based system whereby the MAC would advise on shortages in low-skilled roles and the government would implement sector-specific allowances accordingly. This plan is highly unlikely to be able to respond rapidly enough to employers’ needs for low-skilled workers. The National Farmers’ Union and other stakeholders in the agricultural sector reported labour shortages and requested a sector-specific scheme for several years before a Seasonal Agricultural Workers Scheme pilot was introduced in 2019. The government disputed the shortages and expected businesses to invest in technology to reduce their reliance on low-skilled workers. However, the required technology was in most cases unavailable or too expensive. Businesses are unlikely to be able to access the labour they need under the government’s plans for sector-based schemes.
What else?
The MAC has also suggested that the rules around settling in the UK be reviewed. Perhaps Tier 2 Intra Company Transfer migrants will be eligible for settlement again, as they once were. In the meantime, the MAC has advised the government to suspend minimum salary requirements that Tier 2 migrants must meet when they apply for settlement.
In addition to the gulf that exists between the government and the MAC over the points-based system, there is tension between the government and the Law Commission, which in January 2020 recommended simplifying the rules. The Law Commission recommended less prescriptive requirements for documents to support applications: caseworkers should consider a wider range of documents, it said, and decide whether the underlying requirement of the immigration rules is satisfied. The government has been moving steadily in the opposite direction, towards strict criteria and the automation that these make possible. However, a change in direction to allow for more discretion by caseworkers is possible. Indeed, anything is possible in the future immigration system.