When the government launched the UK points-based immigration system in 2021 it promised the scheme would open the UK to recruitment of the ‘brightest and the best from around the world’. As UK employers continue to struggle to fill vacancies our business immigration solicitors look at what employers need to know about the UK points-based immigration system to successfully sponsor staff from overseas on skilled worker visas.
Key points on the UK points-based immigration system
The key points on the UK points-based immigration system are:
- Since 31 December 2020 EU and non-EU citizens are treated the same under the UK immigration rules unless the EU national moved to the UK before 31 December 2020 and applied for pre-settled status or settled status under the EU Settlement Scheme
- The end of free movement for EU nationals has seen a rise in sponsor licence applications by UK business owners as UK employers can no longer recruit EU workers to meet their recruitment needs unless the EU national either has settled status or the appropriate visa. As existing EU workers age and retire, or EU staff seek alternative employment or return to their home countries, the need for sponsor licences will increase unless the UK skills gap is successfully addressed through training
- There is no low-skilled work visa route to replace EU nationals who exercised free movement to come to the UK to take up lower-skilled jobs. With some UK visas, those subject to immigration control can be employed in lower-skilled roles, such as part-time employment on a student visa or employment on the graduate visa
- To obtain UK entry clearance a skilled worker visa applicant needs to score 70 points under the points system. Some of the points are compulsory and others are tradeable
- There is no annual cap or limit on the number of skilled migrant workers who can apply for sponsorship under the skilled worker visa or routes under the global business mobility visa
- The skill threshold for sponsoring a worker on the skilled worker visa is RQF Level 3 (equivalent to an A-Level). The skill threshold for the old work visa, the Tier 2 (General) visa, was RQF Level 6 (equivalent to degree level)
- The immigration skills charge is payable by employers for each sponsored employee. As the number of sponsored employees has increased with the end of free movement for EU workers the charge has increased the cost of recruitment for UK employers. The government has produced a guide to the immigration skills charge
- A graduate visa has been introduced for international students in the UK wanting to stay in the UK after their graduation. To qualify for the graduate visa an applicant does not need a job offer from a UK employer and there is no minimum job skill level or minimum salary threshold. The graduate visa offers greater flexibility to UK employers and eligible international students in comparison to the skilled worker visa. However, unlike the skilled worker visa, the graduate visa does not lead to UK settlement
The introduction of the UK points-based immigration system has had significant legal, financial, and practical consequences for all UK employers, large or small, and whether or not the business already employed a workforce comprising of EU or non-EEA employees.
How the points-based immigration system works
Those who want to enter the UK for work need a points-based work visa and need to score a minimum of 70 points to secure a visa.
The points-based immigration system is more complicated than simply adding up and reaching 70 as some elements of the points system are compulsory. That means however skilled your overseas-based recruit is, or whatever salary you are proposing to offer, your sponsored worker may not meet the points-based immigration system eligibility criteria.
The simplest way to look at how the new points-based immigration system works is to look at it in tabular form:
|Points award||The number of points awarded||Are the points tradable?|
|Job offer by an employer with a sponsor licence||20||No|
|Job offer at an appropriate skill level (at least A level qualification)||20||No|
|Visa applicant speaks English to the required standard set by the Home Office||10||No|
|Salary is £25,600 gross or over per year||20||Yes|
|Salary is £23,040 to £25,999 gross per year||10||Yes|
|Salary is from the minimum of £20,480 to £23,039 gross per year||0||Yes|
|Job is on the Shortage Occupation List produced and updated by the Migration Advisory Committee||20||Yes|
|The applicant has a PhD in a subject that is relevant to the job offer||10||Yes|
|The applicant has a PhD in a STEM subject that is relevant to the job offer||20||Yes|
Once an employer has studied the table and added up the points it should be straightforward to see if a work visa applicant will have sufficient points to qualify for a skilled worker visa. However, as the non-tradable points are the compulsory points the new points-based immigration system is producing some unexpected results.
For example, a scientist wanting to come to the UK secures a job offer with a sponsor licence holder at a starting salary of £100,000 a year. The applicant has a STEM PhD qualification. Their points should total 80 but the scientist isn’t eligible for a skilled worker visa as they don’t meet the compulsory and non-tradable English language speaking requirement. That is the case even if the recruit’s ability to speak the English language isn’t a significant consideration for an employer, who is more interested in the job applicant’s scientific qualification and level of expertise. In this scenario, the job applicant may be eligible to apply for a global talent visa as there is no English language set criteria under that route.
The minimum salary thresholds and the skilled worker visa
The minimum salary thresholds are recommended by the Migration Advisory Committee (MAC) and finalised by the UK government. Disappointingly for some UK regions, there is no regional minimum salary threshold or London weighting. A veterinary surgeon or scientist has to be paid the same minimum salary threshold or going rate for the job whether or not the job is based in Sheffield, London or the home counties.
There are additional complexities to the minimum salary rules because UK employers have to pay skilled worker visa holders the higher of the:
- Going rate for the job that they want to sponsor. The going rate is determined by the Home Office by reference to the standard occupational classification code of the sponsored job
- The minimum salary threshold, unless the work visa applicant can secure the 70 points by the award of points for a PhD which is relevant to the job offer, a PhD in a STEM subject which is relevant to the job offer, or the job, is on the shortage occupation list or the job applicant qualifies as a ‘new entrant’.
It isn’t sufficient for HR staff to add up the 70 points. They, or their business immigration solicitor, also need to have a thorough understanding of how the UK points-based immigration system works. For example, only basic salary counts towards the minimum salary threshold and not allowances or employer pension contributions.
When it comes to ‘new entrants’ the salary requirements are set at 30% less than the rate for an experienced worker in the same job. That means that the minimum salary threshold of £20,480 is reduced for a new entrant unless a higher ‘going rate’ applies to the specific job.
Does the global talent visa give employers more flexibility?
HR staff need to be aware of the potential for highly skilled workers to apply for a global talent visa, rather than the job applicant being sponsored to come to the UK on a skilled worker visa. There are significant advantages to both employer and employee of the visa applicant entering the UK on a global talent visa, namely:
- No need for a job offer before making the visa application
- No need for a sponsor licence - the employer does need a sponsor licence to employ someone who has secured a global talent visa
- No need to meet the English language requirement as a global talent visa applicant does not have to meet the English language eligibility criteria
- The global talent visa applicant has greater flexibility over work options and the potential to secure accelerated settlement in the UK, provided the applicant can secure an endorsement from an endorsing body by proving they have talent or promise in their chosen specified field or area of expertise
The main point for employers is that under the UK points-based immigration system there is no immigration route for lower-skilled workers unless, for example, they meet the eligibility criteria to secure a visa under the seasonal agricultural worker scheme.
Tips for UK employers on how to work with the points-based immigration system
Our business immigration solicitor has provided tips on how employers, from SMEs to multi-nationals, should best work with the UK points-based immigration system:
- Take a careful look at the makeup of your current workforce. What percentage of your workforce are low-skilled workers? What percentage of your workers are currently from the EU and what is their age range and skill set? Of those workers who are from EU countries do you know how many have secured pre-settled status or settled status under the EU Settlement Scheme? What percentage of your workforce are from non-EEA countries?
- Do you have a business plan in place? Do you have ambitious expansion plans? Consider how those plans may be affected if your suppliers of materials or parts have to increase their prices because their overheads go up as a result of the reduction in the availability of low-skilled EU workers. Can you reduce your exposure to a likely increase in supplier costs by changing suppliers, for example, purchasing from overseas or fixing your prices?
- Are you heavily reliant on a current workforce of low-skilled workers from the EU? If they have not already done so, encourage your existing EU workers to apply for pre-settled status or settled status. Although applications to the scheme stopped on the 30 June 2021 the Home Office still allows late applications where there was a reason for the delay in applying for settled status.
- Have you thought about how to retain your staff? The government has said that a low-skilled or temporary work route into the UK for non-EEA or EU workers won't be introduced to ease the recruitment crisis in some sectors of the UK industry, employers need to look at how they can encourage their existing workforce to stay in their employment. Does your business already have staff retention schemes in place, such as rewards for long service or bonus incentives?
- In an age of low unemployment within the UK, how can you attract UK low-skilled workers to your business? Can you offer flexible working or apprentice schemes or offer work experience packages through forming links with schools and colleges? Will you need to resort to golden hello packages to attract recruits?
- Can you counteract increased competition for low-skilled workers by increasing productivity? If you are concerned about the prospects of recruiting sufficient numbers of low-skilled workers because of the end of free movement and the increased competition to recruit UK low-skilled workers, are there elements of your working practices that could be automated or could productivity be increased through the use of AI?
- Apply for a sponsor licence now. If you know you will need to recruit overseas workers in future then apply for a sponsor licence now. It takes time to secure a sponsor licence because so many more UK companies now need a sponsor licence as EU nationals, as well as non-EEA nationals, are required to have a sponsoring employer if they are subject to immigration controls and require a skilled worker visa.
- Comply with your sponsor licence duties. If you already have a sponsor licence then make sure that you comply with your sponsor licence duties as the consequences for your business of having your sponsor licence suspended or revoked have increased with the introduction of the new points-based immigration system
- Do you need to invest in more HR staff? You may need more personnel to manage your sponsor licence because new EU employees arriving in the UK now need to be sponsored under a skilled worker visa. Alternatively, do you need to invest in a sponsor licence management service or training seminars for your HR staff and sponsor licence key users?
- Plan for a potential increase in recruitment costs. It is now harder for UK employers to recruit low-skilled workers in some sectors of the UK economy without the use of specialist recruitment agencies. Furthermore, if you need to recruit skilled workers from overseas then EU job applicants need a work visa and sponsorship. That means you are likely to be incurring extra business overheads in securing and maintaining a sponsor licence as well as having to pay the immigration skills charge for sponsored skilled migrant workers.
- Think outside the box. If you are struggling to recruit overseas workers because of the constraints of the skilled worker visa then the global talent visa or the graduate visa may be alternate routes to recruitment as both visas, in their different ways, offer greater flexibility to UK employers.
- Keep up to date with future points-based immigration system changes. It may be trite to say to keep up with the new immigration landscape and changes, but it is true. Recruitment of the workers that businesses need is becoming harder and your business and so the HR team need to be one step ahead of the competition, whether your company is a SME or a large multinational organisation. With ongoing careful planning and advice, your business can try and stay ahead of its competitors in the race to recruitment in the post-points-based immigration system era.
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