UK News

Imminent changes to UK Immigration system require immediate action

September 2008

This Alert is essential reading for organisations that employ non EU nationals in their UK workforce.  From the end of November the current UK work permit scheme will be replaced with a new points-based qualifying system.  From the end of November employers who wish to employ non-resident workers in the UK will require a license to issue "certificates of sponsorship" to candidates.

Background

The Home Office is part way through a total overhaul of the UK immigration system.  The old regime with almost three dozen immigration categories, each with their own qualifying criteria, is being simplified to a 5 tier "points-based" system.

The first phase of the re-organisation took place at the end of June, when the Highly Skilled Migrant Programme, already a points-based system, was replaced by "Tier 1", covering highly skilled workers, as well as investors, entrepreneurs and certain students who wish to remain in the UK after completing their studies.

End of the current work permit scheme – employers require a "license to sponsor"

The change with the biggest impact for employers is the closure of the current work permit scheme with effect from the end of November 2008.  (Current work permits will continue to be valid until their expiry date).

From the end of November UK employers who wish to hire non-resident workers and who do not qualify for Tier 1 status must hold a license to sponsor "Tier 2" workers and issue a certificate of sponsorship to each applicant whom they wish to employ.

Tier 2 workers include skilled workers with a job offer in the UK or intra-company transfers (basically, transfers between companies in the same group).  The difference between a highly skilled worker covered by Tier 1 and a skilled worker covered by Tier 2 is essentially one of points required to qualify.  (See further below for skilled workers).

Applying for a license to sponsor

Employers may apply for a license to sponsor now and should do so before 1 October if they want to be ready to hire non-resident workers as soon as the new system goes live from the end of November.

The application must be completed on-line (http://www.ukba.homeoffice.gov.uk/employers/points) and original supporting documents establishing the bona fides of the UK employer must be submitted within the following 10 working days.  The application consists of a number of questions about the employer organisation, the number of certificates of sponsorship it is likely to issue each year and the persons in the organisation who will be responsible for administering the system.  Although third party advisers can assist in the preparation of the application, it must be submitted by a permanent member of the employer's staff.

The fee for a license to sponsor is £1,000 (£300 for organisations that qualify as small companies under the Companies Act 2006).  The license is renewable every four years.

New obligations on the employer - penalties for non-compliance

The new licensing system places obligations on the sponsoring employer to help ensure that there are no abuses of the immigration system.  In particular, the sponsoring organisation will have to keep records of the individuals sponsored, including contact details, and inform the Border and Immigration Agency (BIA) if they either do not turn up for work or are absent without permission for a significant period of time.  The BIA will have the right to make spot checks to ensure compliance and if it has concerns about an employer it may either downgrade or revoke its sponsor status. (Civil and criminal penalties may also apply if the employer is found either negligently or deliberately to have employed an illegal worker).

Employer must nominate responsible individuals

The sponsoring organisation must nominate one or more individuals to the following roles:

Key Contact – the main point of contact with the BIA, responsible for dealing with queries on the license application.

Authorising Officer – responsible for the license application and compliance with all duties to the PBS.  This role must be held by a permanent member of staff based in the UK.

Level 1 User – responsible for day-to-day operation of the Sponsor Management System, in particular for assigning certificates of sponsorship, and for updating the sponsor's information held by the BIA.  The Level 1 user must be based in the UK.  An external representative such as a lawyer may act as Level 1 User but may not act as Authorising Officer.

Employing a non-EU resident skilled worker or intra-company transferee from 1 November 2008

Once licensed, an organisation must issue "certificates of sponsorship" to non-resident workers whom it wishes to employ.  (For these purposes a "non-resident worker" is someone who is neither a citizen of an EEA country or otherwise legally entitled to work in the UK).

Each sponsor organisation is granted a quota of certificates of sponsorship, based on information given in the sponsor license application.  Employers should be careful to specify whether they require the right to issue certificates of sponsorship for skilled workers, intra-company transfers, or both.

The certificate of sponsorship is not a physical document, but a unique reference number that is generated by going on-line in the Sponsor Management System.  Once the number is issued by the BIA, it is used to make the application for Tier 2 status.  The certificate of sponsorship is valid for 3 months and if the worker does not use it to make an application, for example because they accept a job with another employer, the sponsoring employer is still required to pay a fee of £170.

Points system

Issue of a certificate of sponsorship does not guarantee that an individual's application for permission to work in the UK will be granted, which will be dependent on the individual meeting the points criteria.  Before issuing a certificate of sponsorship the employer would do best to check that the individual will score enough points to obtain permission to work in the UK (see below).

Intra-company transfers

Intra-company transferees must score a total of 60 points as follows:

Criteria

What can be counted

Points

Sponsorship (30 pts max)

The job is an intra-company transfer

30

Qualifications (15 pts max)

S/NVQ level 3

Bachelor’s or master’s degree

PhD

5

10

15

Prospective earnings (20 pts max)

£17,000 - £19,999

£20,000 - £21,999

£22,000 - £23,999

£24,000 +

5

10

15

20

Maintenance (mandatory)

£800 +£533 for each dependant

10

English language skills (mandatory if individual wishes to stay in the UK for longer than 3 years)

National of a majority English-speaking country; OR individual has passed an English language test; OR has a degree taught in English

10

Skilled workers (not intra-company transfers)

Skilled workers who are not coming to the UK on an intra-company transfer must meet a tougher test, scoring a minimum of 70 points including 10 points for maintenance (funds available to support themselves) and 10 points for English language skills.

Shortage occupations and the resident labour market test

Unless they have been selected for a job on the shortage occupations list maintained by the BIA they must also meet the resident labour market test.  The shortage occupations list is due to be updated in time for November but the current list is limited to certain jobs in engineering, healthcare and education.

The resident labour market test is intended to demonstrate that there is no suitably qualified worker already settled in the UK who could do the job.  Employers are required to advertise posts in compliance with criteria laid down by the BIA.  The BIA intends to publish codes of practice that will specify the advertising requirements for specific jobs and market sectors but in the absence of an applicable code the job must be advertised using Jobcentre plus, the government labour agency.

In addition to any requirements specified in the codes of practice, all advertisements must include details of job title;  duties;  location;  salary package and terms;  skills qualifications and experience required;  and a closing date for applications (unless there is a rolling recruitment programme in place).  If the salary for the job is £40,000 or under it must be advertised for a minimum of 2 weeks;  if the salary is over £40,000 it must be advertised for at least one week.  Any certificate of sponsorship that relies on the advertisement as proof of compliance with the resident labour market test must be issued within 6 months of the placement of the advertisement.

Skilled workers must score 70 points as follows:

Criteria What can be counted Points

Sponsorship (max 50 points)

Jobs on the shortage occupations list

Job meets the resident labour market test

50

30

Qualifications (15 pts max)

S/NVQ level 3

Bachelor’s or master’s degree

PhD

5

10

15

Prospective earnings (max 20 points)

£17,000 - £19,999

£20,000 - £21,999

£22,000 - £23,000

£24,000

5

10

15

20

Maintenance (10 points – mandatory)

£800 plus £533 for each dependent

10

English language skills (10 points – mandatory)

National of a majority English-speaking country; OR individual has passed an English language test; OR has a degree taught in English

10

Recommended Actions

The replacement of the work permit system introduces profound changes.  Employers who find it difficult to recruit within the local labour market or use intra-company transfers to effect knowledge transfer may face delays in filling vacancies if they are not prepared for the new regime.

Steps which you should consider taking now include:

  • Apply now for a license to be a sponsoring employer.
  • Ensure that managers responsible for recruitment understand the new points-based system.
  • Identify whether vacant posts are on the shortage occupations list or whether advertisements will need to be prepared for new hires who are not EEA residents.

For further information, please contact Colina Greenway (colina.greenway@abbisscadres.com) or Guy Abbiss (guy.abbiss@abbisscadres.com) on +44 (0) 203 051 5711.

Click here for a link to Colina's profile.

Disclaimer

Content is for general information purposes only.  The information provided is not intended to be comprehensive and it does not constitute or contain legal or other advice.  If you require assistance in relation to any issue, please seek specific advice relevant to your particular circumstances.