Businesses in the UK who employ foreign workers have in recent years felt the impact of increasingly protectionist UK immigration policy changes. The introduction of the Immigration Skills Charge; closure of multiple visa routes; increases in the minimum salary requirement for Tier 2 skilled workers. Raising the cost, eligibility criteria and narrowing options for migrant workers to the come the UK has been part of the Government’s wider mandate to reduce net migration.
The 2017 Conservative manifesto took on immigration with renewed vigour, reducing its immigration target from 100,000 to the “tens of thousands”. While the make up of the new Government may make new policies more difficult to pass, immigration policy was high on the Conservative agenda, and in light of Brexit negotiations, decisions will have to be made on immigration policy. What UK immigration policy changes should UK businesses expect to see?
- Align the visa system with Britain’s modern industrial strategy
The latest ONS figures show 11% of the UK labour market in 2016 were non-UK nationals. A significant proportion, demanding a framework that manages and supports migration effectively and in line with the economy’s need. Current immigration rules however come under great criticism from employers for being too rigid and inflexible to meet real-world business need. The Government has pledged to seek independent consultation to improve the current visa system and its alignment with UK business. In time, this may result in changes to existing entry routes or the emergence of new types of visa route that support specific needs (such as the Tier 1 Exceptional Talent visa). Although the most recent Government industrial strategy, focused on the UK digital sector, failed to address immigration and the role of foreign talent in moving the sector forward.
- Immigration Skills Charge
The Conservative manifesto pledges to double the recently-introduced Immigration Skills Charge on employers of skilled, non-EU workers who earn more than £30,000.This will raise the charge to £2,000 per worker per year. Funds are intended to be used to invest in education and training development in the UK, to improve and align resident labour to UK business needs. While this additional cost may be tolerable for larger multinationals – start-ups and SMEs may become out-priced from the global market. There are concerns this could impact UK industries’ ability to remain competitive in instances where resident labour is still not meeting skills requirements.
- EU immigration
The Conservatives have stated their intention to end freedom of movement through Brexit negotiations. Should this be an outcome of the Brexit deal, it will require change in UK immigration policy to include a new system for EEA nationals. There has been much speculation but little definitive vision about what this new system would look like. For example, if this would be an extension of the current Points Based System. Whatever the proposed new system, employers should expect additional costs and administration around hiring EU nationals following removal of freedom of movement. The Government is under time pressure to address this cohort since Article 50 has been triggered, certainly before the Brexit deadline of March 2019. Many are pressing for confirmation as a priority to remove the current uncertainty facing this cohort.
- Student visas & graduates
Policy changes are expected requiring international students to return to their home country after graduating. For employers, this is likely to impact graduate and entry-level talent programmes. Recruitment strategies will need to be reconsidered accordingly, for example to explore alternative options to remain.
Time for certainty and sustainability
Since the referendum on Brexit was announced in 2016, UK business has operated under substantial uncertainty. The ability for organisations to plan, strategise and act has come with acute risk without clarity on future immigration policy. But with Brexit negotiations live and a new government mandate, businesses should expect to see changes ahead to immigration policy impacting their employment of migrant workers, and make preparations accordingly. We can only hope for these decisions to come sooner rather than later to enable businesses to move ahead with confidence and clarity.