Digital technology businesses continue to play a key role in the growth of the UK economy. In order to sustain that growth, recruiting highly skilled talent is a must.
The UK digital sector has a strong reliance on the work of non-UK nationals, with a higher proportion of non-UK nationals working in the sector compared to the UK average. With Brexit now a reality and changes to the UK’s immigration system in 2021 actively being considered, we consider how digital businesses can continue to access highly skilled talent from Europe and beyond.
Although the UK left the EU on 31 January 2020, there will be no immediate change in free movement rules. A transition period will be implemented until 31 December 2020 during which the EU rules on free movement of people will continue to apply.
EU/EEA/Swiss nationals (and certain family members) resident in the UK by 31 December 2020 will be eligible to make an application for a UK immigration status via the EU Settlement Scheme. There will also be a process for certain family members not resident by the deadline to come to the UK at a later date. The application process is designed to be user friendly and will involve residence, identity and criminal record checks. Depending on an individual’s period of residence in the UK, they can either be granted “settled status” (permanent residence) or “pre-settled status” (time-limited residence that can be potentially converted to permanent residence at a later date) Applications can be made and documents submitted via a mobile app (which after some initial teething problems, is now available on both Android and Apple devices). EU/EEA/Swiss nationals arriving from 2021 onwards will be subject to more stringent rules, considered below.
The change in immigration rules could negatively impact future staff supply, as migration to the UK will be more difficult after the end of the transition period. Existing employees granted status under the Settlement Scheme will not face the same restrictions as those governed by the new immigration rules that will apply from 2021. As such, ensuring eligible staff make a Scheme application should be a priority during 2020.
The current Tier 2 (General) process for sponsoring non-EU/EEA/Swiss nationals is subject to strict rules and many have argued that it is overly burdensome on licenced sponsors.
Typically, a mandatory period of adverting to the UK-resident workforce is required before sponsorship of a non-EU/EEA/Swiss national is permitted. This, in practice, often significantly reduces the prospect of successful sponsorship.
However, roles listed on the Shortage Occupation List - where the UK Government is satisfied that there is a recognised shortage of skills in the existing UK workforce – are exempt from this mandatory advertising. This has the potential to make successful sponsorship of a non-EU/EEA/Swiss migrant worker into these roles much more likely and less administratively burdensome.
In the most recent update to the Shortage Occupation List, a variety of common digital sector roles were added to this list – including business analysts, systems designers, software developers and web designers.
Previously, restrictive “qualifying company” criteria were placed on sponsorship of Shortage Occupations in the digital sector. This broadly meant that only independent UK SMEs could benefit from the Shortage Occupation rules, whilst organisations with less than 20 staff also had to meet additional criteria.
Thankfully, these qualifying company rules were abolished in late 2019; meaning that significantly more businesses in the digital sector can benefit from the attractive Shortage Occupation rules.
Licenced sponsors are considered to be in a position of trust by the Home Office. As such, they must fulfil certain duties - including a duty to keep records relating to sponsored migrants and reporting certain information on sponsored migrants to the Home Office within specified timeframes. This is an area where we often see licenced sponsors be lax with their procedures, but it is crucial that these obligations are complied with. The Home Office can audit licenced sponsors at any time and non-compliance could result in Licence revocation – which would likely have a substantial adverse impact on the business.
The position from 2021 onwards has yet to be definitively confirmed. The 2019 Conservative General Election manifesto made it clear that an “Australian-style” points based system would be introduced; but in its recently published Report, the Migration Advisory Committee advised against replacing the current rules with such a system. Instead; it recommended that the existing Tier 2 (General) framework be retained in an amended form, with the intention that it will apply to both EU/EEA/Swiss and non-EU/EEA/Swiss nationals. The MAC Report is non-binding and simply advisory to the Government, so there is no guarantee that its recommendations will be followed. Governmental proposals are eagerly awaited.
In the meantime, it would be wise for employers to monitor developments in this area and keep existing recruitment strategies under review. It is possible that Sponsor Licences may be required to hire EU workers not covered by Settlement Scheme rules from 2021 onwards, although this should hopefully become clearer in due course.
Contributor: Fraser Vandal
This publication is intended for general guidance and represents our understanding of the relevant law and practice as at February 2020. Specific advice should be sought for specific cases. For more information see our terms & conditions.