Empowering the Freelance Economy

New immigration rules take effect in December – how will they impact international contractors?

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The UK government has finally released the details of the proposed new Immigration Rules – some of which come into effect from 1 December. Those relating to EU nationals come into effect from 1 January 2021. Osborne Clarke’s Employment and Pensions specialists outline the latest on worker immigration laws and how they could impact highly skilled contractors, staff agencies and clients with inter-company transfers.

Important changes

The “immigration cap” will be suspended, not deleted or removed entirely.  Although the cap was largely irrelevant given the number of exemptions, the suspension is a significant political step and will result in there being no theoretical limit on the numbers of skilled workers who can come to the UK.

Tier 2 is replaced by the new Skilled Worker route. As expected, there will be no requirement for employers to advertise roles (undertake a Resident Labour Market Test (RLMT)). This will remove at least four weeks from the end-to-end process for sponsoring skilled workers and save the internal management time spent posting advertisements and filtering applicants.

Although the formal advertising requirement is to be removed, the UK government still expects sponsors must still be seeking to fill a genuine vacancy – roles cannot be created solely to facilitate immigration of a specific migrant to the UK. For that reason, some employers may prefer to carry on advertising roles in accordance with their own practice which will be a lot easier to manage than the specific criteria needed for a formal RLMT process.

Skill thresholds

From December 2020, the skill threshold to qualify for a work visa is reduced from Regulated Qualifications Framework (RQF) Level 6 (degree level) to RQF3 or above (equivalent to A level). The minimum salary requirement is however not reduced significantly to compensate. The general salary threshold will be £25,600 or the going rate for the role, whichever is higher.

However, there is a formula for lower salaries – but no less than £20,480.  The new rules will allow for a trade-off.  Higher academic achievement, being under 26  or employment in a Shortage Occupation List role can be off-set against salary requirements.

Intra-company Transfer

The current Intra-company Transfer route will remain open for employees with more than 12-months service overseas. The current concession to reduce this qualifying period for those earning £73,900 or more remains. Given the removal of the advertising requirement, this route becomes less attractive especially as the minimum salary will normally be £41,500. The route will still not provide an avenue to settlement. However, it will be possible to switch into the Skilled Worker route while still in the UK.

From 1 December, the ability to change visa status in-country is to be expanded to cover the majority of economic visa categories (for example, Youth Mobility to Skilled Worker) but not from Visitors.

Cooling off period

Other interesting highlights are the removal of the “cooling off” period for Tier 2 Migrants and only requiring applicants to prove English language ability and maintenance once – rather than on initial application and extension.

In the meantime, Osborne Clarke’s general advice remains that if you are an international business and/or currently employ non-UK nationals, the new rules will have an impact on how you recruit and staff your business.

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