05 February 2020 #Immigration
The UK left the EU without much of a bang, but this partly because we now enter the second stage of Brexit – the transition period. As we explained in our earlier blog, there will be little change to Immigration Law until the end of the transition period. However, the effects of this withdrawal can be seen in a reduction of EU migration to the UK. This trend is expected to continue for the next few years.
The most recent report of the Office of National Statistics (November 2019) confirmed that net migration from the EU had fallen to its lowest in over 17 years. This is despite freedom of movement still being available to EU citizens. We expect a sharper fall towards the end of 2020 and for this to continue in 2021, when the new immigration system rolls out.
The challenge for businesses
Businesses, and in particular certain sectors have faced the brunt of this sharp decline. Whilst there are several examples of sectors who are unable to plan their growth, an example is the hospitality sector. The sector aims to continue its growth and add hotel rooms. However, their growth ambition requires thousands of workers in the hospitality sector. As the sector relies heavily on EU workers (a recent report by KPMG states the figure to be between 12.3% to 27.3%), the fall in EU net-migration does not help.
The interim solution
Whilst we wait for the government to provide a better solution to deal with the growing shortage of workers in most sectors, the immediate solution for most is to continue reliance on the EU Settlement Scheme. This scheme continues to be open to all EU nationals who arrive and become resident in the UK before midnight 31 December 2020.
We expect most of these EU nationals to be granted Pre-Settled Status, a 5-year limited status, which then allows them to apply for Settled Status at the end of this period. Settled Status is a permanent status and allows holders to apply for British citizenship in due course.
Preparing for the long-term
The Migration Advisory Committee in their January 2020 report highlight the problems with the current Point-Based System, and whilst the recommend retaining the Tier 2 route, their report also advises on making several key changes.
One key recommendation is to reduce the minimum salary threshold from £30,000 to £25,600 for experienced workers (this figure is lower for ‘new entrants’). Crucially it also recommends lowering the minimum skill level to Regulated Qualification Framework (RQF) level 3 from the current RQF level 6. This means previously ineligible job roles, such as hotel managers, could be included in the Tier 2 regime.
We expect the government to adopt these changes, considering the brewing shortage of workers post-Brexit.
As such, for most businesses, the advice would be to obtain a Tier 2 Sponsorship Licence. This allows them to get ahead and prepare themselves in recruiting the vital workforce they will need for post-Brexit world.
As the government has steamed ahead with the revamp of the Tier 1 Exceptional Talent, and renamed it the Global Talent visa, we expect a ‘wait and see’ approach for migrants without a job offer. This means a return of the Tier 1 (General) route seems unlikely in the short-term.
However, the Post-Study Work visa (renamed the ‘Graduate Immigration Route’) is set to make a return next year, allowing international students to remain in the UK for 2-years. The re-opening of this route will add to the pool of available workforce for business.
The new immigration system
Further details of the Global Talent visa, perhaps the first ‘new’ route to be added to the new immigration system were released on 30 January 2020. The route officially opens on 20 February 2020.
We expect further changes in March 2020, including an immigration bill, which provide the much-needed information for the ‘unified’ immigration system.
2020 promises to be another year with several immigration changes. We hope that these changes aim to simplify and streamline the current immigration system, as recommend by the Law Commission.
We will continue to provide updates and commentary as these changes happen. In the meantime, if you have a question in respect of these changes, please do not hesitate to get in touch.