Following the UK’s exit from the EU, as of 1st January 2021, free movement of people within the EU will end and the UK will introduce a points-based immigration system, like the ones we have seen in New Zealand and Australia.
Consequently, this will have a major knock-on effect for many businesses around the UK who regularly hire labour from outside of the resident labour market.
The Home Office recently released some further guidance on this new system to help employers better understand what this might mean for them, which you can read here.
We’ve also broken down this document, highlighting the key takeaways for employers.
How will the points-based immigration system work?
The points-based system will be similar to ones used in countries like Canada and Australia for over 30 years. It seems to have worked well for them and the UK are hoping they can replicate that success and have more control over who can enter the country.
The aim of a points-based immigration system is to end free movement of people and attract only high-skilled workers that will contribute to the economy and community.
In order to achieve this, top priority will be given to those with high skill jobs, such as scientists, doctors, engineers and academics.
As a result, anyone coming into the UK to work will need to demonstrate that:
- They have a job offer from a Home Office approved sponsor
- The job offer is at the required skill level (A level and equivalent)
- They speak English
Furthermore, if they earn more than the required minimum salary then they are eligible to make an application, and if they earn less than the required minimum salary threshold of £25,600, but no less than £20,480, they may still be eligible if they can demonstrate that they have a job offer in specific shortage occupation or a PhD relevant to the job.
For each of the requirements met, the candidate will be awarded a certain number of points with a total of 70 points needed to be able to apply to work in the UK.
Anyone coming to work in the UK will need to be paid the higher of the specific salary threshold for their occupation – the ‘going rate’ – and the general minimum salary threshold. However, some applicants will be able to trade characteristics, such as their qualifications, against a lower salary.
The full break down of this list of characteristics and points system can be found here on the government website.
What skill level will be covered?
From January 2021, the current Global Talent route will open to EU citizens on the same basis as non-EU citizens. This means the most highly skilled, who can achieve the required level of points (70 points in total), will be able to enter the UK without a job offer if they are endorsed by the relevant competent body.
In the longer term, an non-sponsored route for highly skilled workers will be introduced. This would allow a small number of the most highly skilled workers to come to the UK without a job offer.
There will not be an immigration route specifically for those who do not meet the skills or salary threshold for the skilled worker route.
The new immigration system provides greater flexibility for employers with changes to salary and skills thresholds. Employers can also benefit from the youth mobility scheme. The UK has arrangements in place with eight countries and territories to enable around 20,000 young people to come to the UK each year.
Initiatives are also being brought forward for scientists, graduates and NHS workers, which will provide businesses with additional flexibility. A new Graduate Immigration Route will be available to international students who have completed a degree in the UK from summer 2021. This will enable international students to remain in the UK and work at any skill level for two years after they have completed their studies.
How will the points-based immigration system affect businesses?
The big question for employers is – how will this new points-based system affect my business, if at all?
If your business has employees that are EU citizens but live in the UK, then this new system will not affect their status. They will just need to apply to the EU Settlement Scheme by the 30th June 2021.
As a transition measure, employers can continue to accept the passports and national identity cards of EU citizens as evidence of their right to work up until 30th June 2021.
If your business typically hires, or relies on the recruitment of, skilled migrants, then you’ll need to understand how the system works and the role you play in making it work for your company because the new restrictions will impact who and how you hire.
What can employers do to prepare for the points-based immigration system?
If you feel as though your business will be looking to recruit skilled workers from outside of the UK, then you will need to start preparing for this points-based immigration system by getting on the Home Office approved sponsor list.
The application process for this is simple, with the standard processing time being around 8 weeks, so we suggest that you start this as soon as possible.
You will need to:
- Check that your business is eligible for approved status
You must not have unspent criminal convictions for immigration offences or crimes such as fraud or money-laundering.
- Choose the type of licence that you want to apply for
Tier 2 – which is for skilled workers with long-term job offers
Tier 5 – which is for skilled temporary workers
You can apply for either or both
- Decide who will manage sponsorship in your business
You need to appoint an authorising officer, key contact and level 1 user from within your business to manage the application process through the sponsorship management system (SMS). These roles can be filled by the same person.
- Apply online and pay a fee
The fees vary depending on business size and type of licence that you are applying for, but these start at £536
As always, to prepare for any change in laws and legislation, you should ensure that you are staying up to date with all the latest news and keeping yourself informed as and when things change.
As the consequences of Brexit unfold over the coming months, we are here to help support businesses with any changes to existing legislation, or new legislation, that comes into place. Our HR and Health and Safety Consultants stay up to date with all the latest news so they can ensure your business is always one step ahead.
If you have any questions or concerns about this points-based immigration system, then please call us on 0845 2626 260