What does the immigration White Paper mean for recruiters and the UK's labour market? - Quick reads - Gateley
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What does the immigration White Paper mean for recruiters and the UK's labour market?

Gateley Legal

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On 19 December 2018, the Home Secretary published its long-awaited White Paper entitled ‘the UK’s future skills-based immigration system’. Following the recent findings of the Migration Advisory Committee (MAC) who were commissioned by the Home Office to report on the anticipated impact of Brexit on the UK labour market, the White Paper proposes the government’s key principles for the UK's immigration system once the UK has left the EU.

Below we have outlined the key proposals of the White Paper, with some significant consequences on the recruitment sector. 

Summary of key changes for workers:

  • Once the UK has left the EU, following an implementation period, EU nationals will no longer be able to travel to the UK for work without a visa.
  • There will be no preferential treatment for EU nationals and so EU and non-EU nationals will be subject to the same visa regulations.
  • The new worker immigration system will be phased in before the end of the implementation period, which is expected to end on 31 December 2020. In the event of a no-deal, it is not likely that the new system will be introduced immediately.
  • The “pre-settled” and “settled” status schemes for EU nationals living in the UK prior to the UK leaving the EU will continue to be rolled out with a view to it being open to all applicants by 29 March 2019. Negotiations are currently ongoing to introduce similar arrangements for Iceland, Lichtenstein, Norway and Switzerland.
  • The UK will expand existing youth mobility arrangements currently open to limited numbers of migrants aged 18-30 from Australia, Canada, New Zealand, Monaco, Japan and Taiwan to select EU member states. Tier 5 (Youth Mobility) allows for a 2-year visa in the UK with no restrictions on work.
  • The UK will at the same time expand on the World Trade Organisation ”GATS Mode 4” commitments with regards the movement of member-state citizens to provide business services.
  • There is intended to be visa-free travel between the EU and UK for visits. Visitors from the EU will be able to apply for pre-security clearance similar to the US Visa Waiver Scheme and use electronic gates at the UK border.
  • All non-UK (and non-Irish) workers travelling to the UK to work will require sponsorship. On the advice of the MAC, there will be no cap on the number of people being sponsored. 
  • There will also be no more Resident Labour Market Test (RLMT). The Immigration Skills Charge is seen as an appropriate method of protection against migrant labour putting downward pressure on wages.
  • The new sponsorship system will be as 'light touch' and 'straightforward' as possible. The 'administrative burdens' of sponsorship will be reviewed to ensure that they are 'proportionate to the objective of minimising immigration abuse'. Therefore, we can expect changes to the current duties imposed by the Home Office on Tier 2 and 5 sponsors.
  • Nationals of the “lowest-risk” countries will be able to apply for work visas in the UK as opposed to returning to their country of nationality or residence to make an entry clearance application. It is not specified which countries would qualify as being “low-risk” but would logically relate to nationals from countries that rarely feature in immigration enforcement action data or those countries that do not feature on the ‘visa national’ list within the visit visa rules that determine which nationalities need prior clearance before visiting the UK.
  • The new worker route will be based on skill level of RQF3 and above, as opposed to RQF6 and above as currently exists for Tier 2. This still excludes a lot of lower skilled occupations which are currently performed by EU nationals. The view of the Home Office is that it is for employers who have become reliant on EU labour to take this opportunity “to drive business change” and ensure that they are at “the forefront of innovation going forward" in order to become less reliant on EU labour.
  • The Home Office will introduce a transitional 12-month short-term visa route with a 12 month cooling off period with no sponsorship requirement to provide a period of cover whilst the above employers address issues with not being able to recruit from outside the UK for low-skilled work. This will also only be for nationals of “low risk” countries. This route is to be reviewed in 2025 with a view to it being closed at that point.

Our view:

The current proposals to end free movement for EU nationals in place of a system whereby employers are required to sponsor workers at a skill level of RQF3 or above has very significant ramifications on the supply of low-skilled labour from outside the UK.

First, RQF3 excludes most occupations within the construction, retail, tourism, social care, warehousing, transportation, restaurant and cafe sectors, and administrative positions in all companies. Only senior managers in these sectors would be seen as qualifying for a work visa.
Second, the rules for employers currently prohibit sponsoring a worker who is then outsourced to another company regardless of who is employing the migrant. There cannot be an employer with an ‘umbrella’ licence who sponsors workers on behalf of other companies unless the companies have the same ownership.

While there is mention of a short-term 12 month route for low-skilled workers, it is yet to be established which countries would be considered ‘low-risk’ although the language of the paper does suggest it would be countries such as Australia, Canada, the US, Singapore, New Zealand, South Korea and other developed countries who currently qualify for visa-free travel to the UK. It remains to be seen if the UK will intend to offer preferential treatment to certain EU countries over others. 

The UK government wants employers who traditionally rely on low-skilled labour to drive alternative means of recruiting from the local labour market, which many companies will see as in contrast to the evidence that they have offered the Home Office of the general inability to be able to recruit UK nationals for certain roles.  

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