Frontline - Immigration update - Edition 6 2019

By Sam Rayner, Alison Dixon, Tom Mintern, Jonathan Goldsworthy, Yuichi Sekine


The ongoing election of the new leader of the Conservative Party has brought Brexit related immigration issues back into the spotlight and we expect immigration to continue to dominate in the months leading up to the UK's planned EU exit on 31 October 2019. There have already been some significant developments over recent weeks which are covered below, although not all of the proposed changes directly relate to Brexit.

Frontier Workers

The Home Office has released new guidance on how frontier workers, which are EU, EEA and Swiss citizens who work in the UK but live elsewhere, will be affected post-Brexit.

Regardless of whether the UK leaves with or without a deal, up until 31 December 2020, frontier workers will be able to continue working in the UK without having to do anything to protect their right. In short, nothing changes until 31 December 2020.

Thereafter, assuming a frontier worker began working in the UK before 31 December 2020, their frontier worker rights will continue provided they apply for and receive a frontier worker permit (in a deal scenario) or frontier worker status (in a no deal scenario). Irish citizens will not need to apply for a frontier worker permit or status.

Further details on how to apply for a frontier worker permit or for frontier worker status, whichever is relevant, will be released by the Home Office in due course.

Shortage Occupation List

The Shortage Occupation List (SOL) is a list of jobs in respect of which employers do not have to conduct the "resident labour market test" (the test for whether a "settled worker" is available to perform a role, before such a role can be offered to a non-EU worker). The list is composed of roles where there are not enough resident workers in the UK to fill vacancies and currently makes up just 1% of the UK labour market.

On 29 May 2019, the Migration Advisory Committee (MAC) published its latest review on the SOL which put forward a variety of recommendations. The most significant, however, is a substantial increase to the SOL. The MAC is now recommending that c.9% of the UK labour market should be covered, with a variety of new professions added to the list and a number of currently listed occupations significantly expanded upon. One example is the expansion of digital occupations to include programme, software and development professionals. The health, engineering and educational sectors also received significant job additions to the recommended SOL.

The MAC recommendations remain some way off becoming a reality at present. They are dependent on the retention of free movement of workers in any Brexit arrangement and preservation of the resident labour market test (which the Home Office has indicated might be eliminated from January 2021). Nevertheless, a significant expansion of the SOL is a very real possibility in the future. Such a change would clearly have major positive implications for employers as it opens up a much wider pool of talent for applicable vacancies that employers hold.

Post-Brexit Salary Thresholds

Concern has been raised amongst employers about the potential for a £30,000 minimum salary requirement (which is currently imposed on non-EU migrants) being imposed on EU migrants post-Brexit, as was put forward in the Home Office's White Paper on Immigration last year. Although some categories of workers are exempt from this requirement, small businesses remain anxious about the impact this could have on filling low-skilled job vacancies. As a result, the Home Office confirmed on 24 June 2019 that they have commissioned the MAC to engage with businesses, employers and other stakeholders over the course of 12 months to determine where precisely the thresholds should be set. More specifically, the MAC will be considering:

  • the mechanism for calculating future salary thresholds;
  • the impact of salary threshold levels;
  • regional salary thresholds; and
  • exceptions to salary thresholds.

Small business owners, businesses which rely on low skilled workers and businesses in regional areas with lower salaries will be keen to emphasise the adverse impact of having a salary threshold which is too high and not sufficiently caveated.

Immigration Skills Charge: A new way to lose your sponsor licence

Since its introduction in April 2017, the Immigration Skills Charge ("ISC") has added significant cost pressure to employers seeking to sponsor skilled workers from outside of the EU. The ISC is generally payable when an employer sponsors an employee on a Tier 2 visa for more than six months, subject to limited exemptions. The ISC amount is charged at £1,000 per year for a large company, with a reduced ISC fee for small companies.

Whilst the Home Office policy guidance is clear that ISC must not be passed on to applicants applying for a Tier 2 visa, some sponsors may be tempted to transfer the cost of the ISC to their employees. Specifically, employers may seek to use clawback provisions, obligating former employees to pay back the ISC charge in the event they leave the company during a prescribed period.

To combat this practice, the Home Office has revised its guidance to include a new discretionary ground for the revocation of a sponsor licence where a company obliges (or seeks to oblige) a migrant to account for an ISC. The specific guidance can be found here.

Whilst a minor breach alone may not lead to the immediate revocation of a sponsor licence, it is likely that many employers will be unaware of this new Home Office power. Coupled with other compliance breaches, this new ground gives the Home Office an additional tool to revoke an employer's licence in a situation where non-compliance could easily be overlooked.

Stay tuned to Frontline for further information on changes to the UK's immigration system which effect employers.