With Brexit looming, employers are now turning their minds to the new sponsorship system and rules, some of which start to take effect on 1 December. We’ve highlighted 5 things about the new system that employers need to know and the ramifications.
Let’s face it, the pandemic understandably distracted us for a while, but we can no longer afford to ignore the seismic shift that the ending of free movement of workers is going to bring to all employers.
From 1 January 2021 employers will have to grapple with a new immigration system and many employers are currently auditing their workforce to establish the extent of their reliance on EU nationals. EU nationals currently in the UK should be applying for pre-settled or settled status and it’s advisable for employers to support their EU employees in doing so. For any new non-UK employees who come to the UK next year, an employer may have to sponsor them (if they don’t have the right to work in the UK through other means – ancestry, spouse, etc.) and that may mean that some employers are considering applying for a licence now so that it’s in place ready. For those who have a licence already there are changes afoot and we have summarised the five main ones below:
1. No resident labour market test
Hooray! For those of you who have placed adverts only to realise that a start date was missing, or the salary wasn’t stated can breathe a sign of relief. Under the new system, there will be no need to test the local job market before hiring from overseas therefore, even if the best candidate is not from the UK or Ireland an employer is now able to sponsor and appoint that person. However, UKVI have said that an employer should retain evidence of adverts placed for sponsored workers’ positions. This would seem to be contrary to the removal of the requirement to advertise for the role but it’s likely to be in order to evidence that the role is a genuine vacancy and not simply created to give someone entry to the UK (the example given by UKVI was to avoid an employer creating a role for a family member just to get them into the UK). This is therefore likely to be a fairly straightforward hurdle to overcome.
This change may affect the way some employers decide to recruit. An employer can either cast their net wider to attract the best candidate from anywhere or for those who do not want to become sponsors they may decide to limit the sources in which they place adverts, whilst being mindful about the process and how they select candidates to avoid discrimination claims.
2. No skilled worker cap
Currently there is a limit on the number of restricted certificates of sponsorship (RCoS) that UKVI will issue each year (divided out over the 12 months). A RCoS is typically required for a role where someone is coming into the UK for the first time. An allocation meeting to determine which employers were granted their requested RCoS was held on the 5th of every month. If the limit for that month had been reached, just like the lottery, there would be a roll over to the next month. Under the new scheme there will be no RCoS and therefore, no 5th of the month allocation meetings. Instead, new entrants to the UK who are being sponsored will need a DCoS (Defined CoS) from their sponsoring employer. UKVI have said that an employer requesting a DCoS can expect a swift response to their request and have promised a one-day turnaround. Any RCoS that have been granted will automatically be converted into DCoS when the new system goes live on 1 December (see below). UKVI have said that a panel meeting will run after 30 November to allocate any RCoS which have already been applied for but as there won’t be a cap on DCoS, all those requested will be granted.
3. Reduced skill level
Any roles in which you want sponsor a migrant have to be at degree level but the new rules reduce that threshold to A-Level or above. This therefore opens up the possibility of sponsoring more individuals than under the current rules. By way of example, construction project managers, building contractors, builders, residential, day and domiciliary care managers and proprietors, warehouse, retail, hotel, or leisure centre managers, scientific, laboratory, avionics, electronics, IT support, engineering or civil engineering technicians, computer engineers, are all A-Level skilled roles which will fall under the sponsorship system.
4. Salary threshold reduced to £25,600
£30,000 (or the appropriate rate if higher) is the current minimum salary which must be paid to those who are being sponsored. However, as you may expect, as the skill level requirement has been reduced so has the corresponding salary. To claim 20* points towards the 70 points required the role has to be at the higher of £25,600 or the level set in the SOC Code for the job. *Salary is a tradeable criteria but it cannot drop below £20,480. The 20 points can also be obtained if the job is on the shortage occupation list or if the applicant has a PhD relevant to the job. Currently under the Tier 2 General scheme guaranteed bonuses can be included towards the salary levels but going forward only guaranteed basic gross salary can be included for the purposes of the salary threshold so no guaranteed bonuses will count. Employers will therefore need to structure remuneration packages accordingly, bearing in mind that an increased salary in lieu of bonus entails increased employer NICs, pension contributions and any other payments which are based on salary.
5. New forms
One to note if you or an applicant currently has an application form saved on the system. From 1 December 2020 a new form will need to be used for any applications. Any current forms will be deleted and applicants will have to complete the form again using the new version. Apparently, the new forms go live at 9am on Tuesday 1 December 2020 but UKVI suggest using any saved forms by 30 November 2020. It’s therefore advisable to get any applications in under the current scheme on or before 30 November 2020.