UK work immigration changes that employers should be aware of

UK work immigration changes that employers should be aware of

29th March 2023

The latest Spring Statement of Changes of Immigration Rules has set out important developments that employers should be on top of, as have Budget day Treasury announcements and a new addition to the rules around Scale-up visas just published.

Hike to minimum wages for sponsored migrants

From 12 April 2023, UK employers sponsoring overseas staff will have to pay higher minimum salary levels after UK Visas and Immigration (UKVI) uprated these in the Spring Statement of Changes. This hike is to ensure that migrant worker salaries keep pace with wages in the UK labour market and do not undercut them.

Minimum salary levels for Certificates of Sponsorship on the following sponsored employment immigration routes will rise. If a Certificate of Sponsorship is issued before 12 April, the current salary thresholds will apply, but if it is issued from 12 April the new rates are as follows:

  • Skilled Worker visas minimum salary rises from £25,600 to £26,200 for most applicants unless they fall within one of the options below:
    - Skilled Workers with a relevant PHD from £23,040 to £23,580
    - Skilled Workers with a relevant PHD in STEM, on the Shortage Occupation List, new entrant to the labour market and health or education sectors - from £20,480 up to £20,960
  • Global Business Mobility Senior and Specialist Workers visas and UK Expansion Worker visas from £42,400 to £45,800
  • Global Business Mobility Graduate Trainee visas from £23,100 to £24,220
  • Scale-up visas rising from £33,000 to £34,600
  • Seasonal Worker visas for poultry workers (occupation codes 5431 or 5433) from £25,600 to £26,200

The hike in minimum salaries for sponsored staff may seem a bit steep, but the Migration Advisory Committee (MAC) has been reminding UKVI that they hadn't uprated wages consistently for a few years now. 

When sponsoring immigrant workers, the salary must meet the relevant minimum wage thresholds for the visa type above or the going rate of pay, whichever is highest. The going rates for the various occupational classification codes for different jobs have been updated according to the latest Annual Survey of Hours and Earnings data, and from 12 April these rates are to be worked out on 37.5 hours a week, rather than the current 39 hours to reflect a more common working pattern.

Minimum hourly rates for employees sponsored on Skilled Worker and Seasonal Worker visas are also going up. Skilled Workers hourly rates increase from £10.10 per hour to £10.75 and Seasonal Workers from £10.10 to £10.42 as of 12 April 2023.

The Home Office can refuse an application under most sponsored work and temporary work routes if they have reasonable grounds for believing the job does not comply with the National Minimum Wage Regulations (NMWR) or the Working Time Regulations (WTR). National Minimum Wage rates are rising from 1 April 2023. Employers should ensure they comply with the new National Minimum Wage requirements for all of their workers, and that Certificates of Sponsorship assigned from 1 April 2023 comply with both the prevailing hourly rates set out in the Immigration Rules, as well as NMWR.

Employers should also ensure that where a sponsored worker opts out of the average 48 working hour maximum provided for under the WTR, evidence of this is retained on their HR file.

The Statement of Changes also includes instructions for how to calculate salary thresholds for sponsored migrant employees with different shift patterns.

Sponsoring workers on the Shortage Occupation List

The Shortage Occupation List is a list of jobs deemed to be in short supply in the UK. Employers can hire and sponsor overseas workers in such roles under more favourable criteria than for roles not on the list. The Government’s Migration Advisory Committee (MAC) identifies which jobs would benefit from going on the list.

With current labour shortages in many sectors, employers and others are invited to respond to the Migration Advisory Committee’s Call for Evidence for its review of the Shortage Occupation List (SOL), which closes on May 26th. The MAC is due to update the list in the autumn and has asked for stakeholders to provide well-evidenced submissions.

The MAC previously advised the Government to abolish the 20% discount to the going rate for shortage occupations. However, this recommendation has so far been ignored, so for now, shortage occupations continue to benefit from both a lower base threshold and a 20% reduction on the going rate.

This month, the MAC published an urgent interim report on 26 skilled worker occupation codes where going rates of pay may be low in the construction and hospitality industries - both sectors which have suffered worker shortages well above average for the labour market. It reminded employers to submit more robust evidence if they want more occupations added to the SOL.

The MAC refused to add any of the hospitality occupations to the list. It had been expected that chefs would be classed as shortage occupations, but the committee suggested that the hospitality industry improve pay and conditions to encourage and retain chefs from the domestic labour market.

Construction occupations recommended by the MAC for the SOL are bricklayers and masons; roofers, roof tilers and slaters; carpenters and joiners; plasterers – including dryliners now; as well as construction and building trades undertaking a variety of tasks in the construction, alteration, maintenance and repair of buildings, steeples, industrial chimneys and other tall structures, and of underwater structures, such as acoustician, builder, building contractor, fencer, maintenance manager (buildings and other structures); property developer (building construction). These urgent additions to the list will take effect this summer.

More firms can apply for Scale-up sponsor licences

Unlike other sponsored visas, the Scale-up visa has no Immigration Skills Charge – which is payable on every year a staff member is sponsored. It offers an initial two years’ permission to stay, of which employers only need to be responsible for sponsoring workers for the first six months. Scale-up sponsor licences are also cheaper than many other categories, as well as entailing less work for employers who qualify.

The only way to qualify up to now was to show annualised growth in either turnover or staffing of at least 20% for the previous three-year period beginning with a minimum of 10 employees at the start.

Changes announced this month add a new route for scale-ups to apply for a Scale-up sponsor licence if they are too young to qualify under the standard route with three years’ growth. This will be available from 13 April 2023 and involve applying for an endorsement from an endorsing body. There is no information yet on who that may include, but there will be a fee for the endorsing letter of £1,500. This is presumably in addition to the sponsor licence application fee.

Innovator Founder replaces separate Start-up and Innovator visas

From 13 April 2023, changes will be made to the Innovator visa category making the Start-up route obsolete.

Like the old Start-up visa, the new Innovator Founder immigration route will involve having a business plan endorsed and there will be no requirement to show £50,000 to invest in the business as in current Innovator visas. Unlike the Start-up visa, the Innovator Founder visa will be a route to settlement in the UK and those on it can work for other employers in the UK to earn an income while getting their business up and running.

Endorsement remains an onerous requirement, but this is good news for the UK’s tech innovation sector. The sector is still waiting to find out which body will be endorsing Global Talent visas for digitech leaders after Tech Nation shuts down at the end of this month, following the removal of Government funding.

Expansion of permissible activities for business visitors to the UK

According to the Treasury, there will be an autumn expansion of permitted activities on a visit visa or by visitors from non-visa countries such as the USA and EU. Business visitors of multinational companies, performers and global businesspeople will have more scope for commercial activities in the UK of up to six months. We are told to expect more bilateral agreements for cross-border business visas to come out of the UK’s post-Brexit trade deals too.

The UK launches online Electronic Travel Authorisation (ETA) for visitors

Firms using the current Creative Worker route for productions, or with clients visiting and/or international staff attending business meetings in the UK should be aware that the UK is set to adopt a digital travel authorisation system, much like the USA’s ESTA. The EU is also set to bring in its similar ETIAS scheme, so without an EU nationality, Brits will have to go online to fill out the form and pay the small charge to visit the EU.

The UK’s ETA will allow people two years to visit the UK as many times as they want for up to six months, or for up to three months on a Creative Worker visa concession. It will be rolled out first for visitors from Qatar this autumn, followed by Jordan, Bahrain, Kuwait, Oman, Saudi Arabia and United Arab Emirates next February. Over the course of 2024, this online security vetting form will become a requirement for all visitors who do not currently need a visa for short stays. British and Irish nationals will not need an ETA to travel to the UK, nor will anyone with a visa to enter the UK or permission to live, work or study in the UK.

Other changes to be aware of

Sponsoring employers should be aware that being called to court as a witness or jury have both been added to permitted absences for continuity of employment assessments.

Skilled Worker visa sponsorship now applies to employees working in UK waters and the UK territorial sea, which extends 12 nautical miles from the coast.

Other immigration changes are emerging from the UK’s bilateral trade deals. When the UK - Australia Free Trade Agreement comes into force, Expansion Workers who are Australian citizens or permanent residents will no longer need to demonstrate that they have worked for an employer for the past year in order to be sponsored to set up a UK branch of a business on the Global Business Mobility Expansion Worker visa.

The Youth Mobility Scheme is a handy reciprocal cultural exchange for those aged 18-30 from eligible nations to try life and work in the UK for up to two years (and vice versa). Australia has been given an additional 5,000 places making it a total 35,000 Australian nationals that can come to the UK on this basis in 2023 with the same opportunity for young Brits heading to Australia.

The UK’s bilateral youth mobility arrangement with New Zealand was also enhanced in these latest changes, expanding the age range of those benefitting from the scheme from 18-30 to 18-35 and the length of stay from two to three years. We had expected the same enhancements with the agreement between the UK and Australia; we are not sure why these have not been made in the latest Spring Immigration Rules changes announced by the Home Office. Other countries’ quotas remain the same, apart from Canada whose allocation goes up from 2,000 to 8,000. A new Young Professionals Scheme two-year visa for Indian graduates aged 18-30 was launched earlier this month, with just 3,000 places and a ballot. There were 2400 places in the last ballot leaving 600 places for the next allot expected in the summer.

To discuss any of these UK immigration developments, or for any related advice or help formulating company policies please contact [email protected].