The new immigration system for skilled workers

From 1 January 2021, freedom of movement for nationals of the European Economic Area (EEA) and Switzerland will come to an end. This will mean that, from this date onwards, all non-UK nationals (except those from Ireland) wishing to come to the UK to work will require a visa for all but short-term visits.

What is the current position?

As free movement of people will continue until 31 December 2020, EEA and Swiss nationals (plus certain family members) can travel to the UK without any need for a visa.  Those resident in the UK by the end of the year can apply for status under the Settlement Scheme. 

There are currently two main routes available to non-EEA migrant workers: Tier 2 (General) for highly skilled workers and Tier 2 (Intra-Company Transfer) for highly skilled workers who are being transferred to a UK branch from an overseas employer.

What are the key changes?

From 1 January 2021, the Tier 2 (General) visa will be abolished and replaced with the “Skilled Worker” visa. The Skilled Worker visa will be broadly similar current Tier 2 (General) visa, save for the following key differences:

• It will apply to more people. The system will apply to both EEA and non-EEA individuals who intend to travel to the UK from 1 January 2021 onwards. It will not be restricted to non-EEA nationals like the current system.
• The skill level threshold will be lower. Currently, only roles that would typically require a Degree or Masters qualification (RQF Level 6 roles) are eligible for sponsorship. The new Skilled Worker visa will be available to individuals filling lower-skilled roles at RQF Level 3 and this will see a greater number of roles be capable of sponsorship.
• The baseline minimum salary requirement will also be lower. In line with the reduction in the skill level threshold, the baseline minimum salary requirements will also be lower. An employer will need to pay a minimum salary of £25,600 or the “going rate” for the job (whichever is the higher), subject to a few limited exceptions - such as where the role is on the Shortage Occupation List or if the employee is a new entrant to the labour market.
• The Resident Labour Market Test will be a thing of the past. An element of the current system that is often a cause for frustration is the requirement for employers to advertise vacancies for 28 days to give UK/EEA nationals a chance to apply for the role first. If a UK/EEA candidate can perform the essential requirements of a role, then sponsorship is prohibited under the current rules. The removal of this clunky and time consuming advertising period has been almost universally welcomed.
• There is no cap on the number of applicants. The current Tier 2 (General) system limits the number of new entrants to the UK, but this will not be a feature of the Skilled Worker rules.
• The new system will be more flexible. The Tier 2 (General) system is very rigid and offers little flexibility. Under the Skilled Worker rules, applicants will be allowed to “trade” various characteristics in order to obtain the requisite number of points to successfully apply for the visa. A job offer from an approved sponsor, a job at an appropriate skill level and acceptable English language skills are mandatory and will attract 50 points. In order to secure the additional 20 points required, applicants can trade characteristics to meet the threshold. For example; a candidate may be able to enter with a salary below £25,600 or the “going rate” if they intend to work in a Shortage Occupation.

What is not changing?

As is currently the case, any employer that wishes to sponsor a migrant worker must be a Licenced Sponsor with the Home Office. Employers who currently hold a Tier 2 (General) Sponsor Licence will automatically be granted a Skilled Worker Licence for the remainder of their Licence term.  However, it is likely that a number of businesses who have traditionally relied on EEA labour will need to make Sponsor Licence applications for the first time in order to maintain their access to a wide talent pool.

The Tier 2 (ICT) route is to remain largely unchanged. However; given that a number of practical barriers will be removed in the Skilled Worker route, it remains to be seen whether the ICT route will remain as relevant as it is now.

What about low skilled workers?

The new immigration system will not permit low-skilled workers to obtain a work visa. Employers wishing to recruit low-skilled workers will likely therefore need to focus on recruiting from within the UK – for example, by employing UK workers or non-UK workers who already have alternative immigration permission to work in the UK (such as those with status under the Settlement Scheme).

Are there any non-sponsored routes?

The Government intends to create an unsponsored route within the new points based system in order to attract the most highly skilled workers to come to the UK without a job offer. This route will not be open on 1 January 2021, but will be considered over the coming year with details to be confirmed in due course.

What should employers be doing now?

Employers who do not already have a Sponsor Licence should consider as soon as possible whether such a Licence will be required to ensure that they can continue to recruit non-UK nationals from the end of the year, particularly if they are currently reliant on EEA workers.  Applications under the Skilled Worker route will open in December 2020 for travel in 2021.

Current or prospective sponsors should review their HR processes to ensure that the Home Office’s strict compliance requirements are being/can be met.  HR teams should ensure familiarity with Sponsor Licence management and the requirements of the new system.

This publication is intended for general guidance and represents our understanding of the relevant law and practice as at November 2020. Specific advice should be sought for specific cases. For more information see our terms & conditions