A new immigration regime is being introduced before the 1st of January 2021.

If you currently employ or are looking to employ any European nationals or engage in business in the EU, this is particularly important.

We outline the strategies below to prepare your business for the changes ahead.

Brexit: The current situation

The UK left the EU under the terms of the Withdrawal Agreement on the 31st of January 2020.

This deal included a transition period, during which freedom of movement between the UK and the EU continues to operate.

This transition period will end on the 31st of December 2020, after which freedom of movement will no longer operate, and a new immigration system will be introduced to the UK.

This new immigration system will be implemented by the 1st of January 2021, but the exact date is yet to be confirmed.

The current UK immigration system

European nationals in the UK 

European nationals who are working in the UK until the 31st of December 2020 will need to make an application under the EU Settlement Scheme.

This ensures that their right to work in the UK is protected under the Withdrawal Agreement.

From the 1st of January 2021, European nationals entering the UK will need to apply for a work visa under the new immigration system to work in the UK.

This will be more time-consuming and expensive. Therefore, it is beneficial for businesses to employ European nationals before the introduction of the new immigration system where possible.

UK nationals in the EU

From the 1st of January 2021, business travellers between the UK and the EU will be treated as third-country nationals.

This means that they must understand whether immigration permission is required and ensure that their activities are permitted under the Business visitor rules.

Rules may differ between EU countries, so business travellers will need to consider these issues in relation to the specific country they are travelling to.

For example, the Schengen Area covers 26 European countries where UK business travellers may only spend 90 days in any 180-day period without a visa.

It is important to note that UK citizens in Ireland and Irish citizens in the UK will not be affected.

EU Settlement Scheme 

The deadline for applications to the EU Settlement Scheme is the 30th of June 2021.

It is essential that European nationals working or planning to work in the UK meet this application deadline so they are covered by the Scheme and can stay in the UK.

The earlier they apply under the Scheme the better, as this will avoid any delays in processing close to the deadline.

The legal position of EU nationals who do meet the deadline is not clear.

However, it is likely that they will need to show evidence of their application for future work and potentially even to rent a property or access NHS care.

Under the EU Settlement Scheme, individuals will either be awarded Pre-Settled Status or Settled Status.

Pre-Settled Status

Pre-Settled Status allows individuals to stay in the UK for up to 5 years.

After 5 years, they can transfer to Settled Status, which is equivalent to permanent residence.

This means that they can remain in the UK indefinitely.

Settled Status

Settled Status will be awarded to any individual who has already been in the UK for 5 years.

The application process for the EU Settlement Scheme is fairly straightforward, and applications are made using an EU passport.

It involves downloading an app, taking a selfie and scanning the passport.

The individual is then required to complete a simple online form, which requires their NI number to view their records for HMRC, to establish how long they have been in the UK.

If an individual does not have tax records for 5 years or longer, they can provide further documentation to show how long they have been in the UK.

For example, a letter from their employer or council tax.

There are many ways that employers can support employees through this application process.

An effective strategy is a reminder service to ensure that employees are aware of the need to make an application.

Employers can also direct employees to the government website and provide guidance on the application process.

UK immigration from 2021

Current UK immigration system

Currently, any EU National, National of the EEA or a Swiss National can be employed in the UK without requiring any kind of visa.

Whereas non-European nationals need to be sponsored under the tier two immigration scheme to work in the UK. This Scheme consists of two main divisions:

  1. Tier 2 General
    • These individuals are usually new hires and require sponsorship from their employer to work in the UK.
    • They must satisfy the Resident Labour Market Test (‘Suitable Worker’ test), to show that the role could not be filled by a UK national and they must meet an English language requirement.
  2. Tier 2 Intra-Company Transfer (ICT)
    • These individuals usually have at least one year’s experience with a Group Company overseas and are employed at graduate level or above. There is a higher salary threshold for ICT than Tier 2 General.

New UK immigration system

Under the new UK immigration system, European nationals that entered the UK before 2021 will be able to remain.

The new system will cover all types of migration. Therefore, European nationals and non-European nationals will be treated the same. Irish nationals are exempt.

The tier two system for non-European nationals will be largely carried over and will be applied to European nationals.

However, it will be simplified as some aspects of the old system are being dropped.

In particular, the skill level will be reduced from graduate level to A level/school leaver level, and there will be no ‘Suitable Worker’ test.

  1. Skilled Worker
    • The Tier 2 General category will be replaced by a “Skilled Worker” category and this will be the most common type of visa for European nationals. To qualify, two tests will be applied using a points system.
    • For Test 1, 50 mandatory points are required. These are broken down into 20 points for being employed by an approved sponsor, 10 points for being employed in a skilled job and 10 points for satisfying the English language requirement.
    • For Test 2, 20 tradable points are required. Points are awarded in relation to salary, having a PhD, being employed in a shortage occupation and being a new entrant.
  2. Intra Company Transfer
    • The ICT category will remain largely the same. However, it is likely that this category will no longer be useful, with the removal of the ‘Suitable Worker’ test for the Skilled Worker category and the fact that this route will never lead to permanent residence. This is something that the Migration Advisory Committee have been requested to consider.

It is important to note that the new system will be inherently more complicated than freedom of movement and will involve substantial costs and limits on who can stay permanently.

Also, there is no low-skilled visa category, which may cause problems for employers who employ European nationals into lower-skilled and lower-paid work.

UK Sponsor Licence 

In order to obtain a work visa, individuals need to be employed by a sponsored employer and receive a sponsorship certificate confirming their job role and salary.

Employers who already have a UK Sponsor Licence will retain their licence under the new system.

Employers who do not currently hold a licence but employ or are planning to employ European nationals will need to apply for one.

The application process involves submitting an online form and filing supporting documents to the UKVI to consider.

The more complex aspect of sponsor licencing is the record-keeping and reporting obligations that come along with it.

Employers with a UK Sponsor Licence must keep on file specific documentation for sponsored migrants and comply with their reporting duties to the Home Office.

Right to work checks 

The law surrounding right to work checks once the transition period ends on the 31st of December 2020 is yet to be confirmed, but government guidance suggests the following:

European nationals who arrive in the UK before the 31st of December 2020 will be subject to the usual right to work checks through checking their EU passport or conducting an online check.

They will then need to apply under the EU Settlement Scheme for pre-settled or settled status.

Once the transition period ends, employers will not need to repeat checks for any existing employees.

The new right to work checks for European nationals will be introduced from the 30th of June 2021, the exact details of which are yet to be confirmed.

It remains unclear how right to work checks must be conducted for European nationals entering the UK from the 1st of January 2021. 

The main issue is that checking their EU passport will not automatically prove their right to work in the UK.

However, requiring to see their Status under the EU Settlement Scheme or the new immigration regime could amount to discrimination or a breach of GDPR.

Employers will likely have a statutory defence to illegal working by checking a European national’s EU passport.

However, there is a risk that later it will transpire that the employee does not have the right to work in the UK, causing considerable disruption.

An advisable approach would therefore be to gently encourage individuals to disclose their Status under the EU Settlement Scheme.

It is essential to phrase this in a way that you want to help them achieve the Status they are entitled to and protect their right to work in the UK.

Preparing for these changes 

Protecting staff

To support your current employees, it is important to communicate and make information available to them.

This includes encouraging European employees to make applications under the EU Settlement Scheme, which enables them to protect their right to live and work in the UK.

As the end of the transition period and freedom of movement approaches, it is essential to make employees aware of the requirements of the new immigration system and provide support with applications where possible.

Managing business

It is important that management understand the policies and that recruiters are aware of the rules and their implications for the business.

We advise that businesses conduct workforce planning to prepare for the new immigration system.

This involves assessing the potential risks and costs involved in hiring European nationals and considering whether your current hiring processes will comply with the new immigration regime.

Another effective strategy is headcount planning. For example, moving individuals to the UK earlier to take advantage of the freedom of movement while it is available.

You could also account for the additional time and cost involved in obtaining visas under the new immigration system when budgeting for 2021.

Finally, it is important for businesses to review their policies, particularly any mobility or onboarding policies, to check whether they need amending to accommodate the new immigration regime.

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About the author 

James Rowland

James is the Commercial Director at Neathouse Partners and regularly writes articles surrounding issues in HR & Employment Law. Outside of the office, James is a keen Cricketer, playing in the Cheshire League for Nantwich CC. He also loves going to watch his football team, Crewe Alexandra. Feel free to connect with James on LinkedIn.

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