Out-Law / Your Daily Need-To-Know

UK immigration from 2021: employer sponsor licences

Out-Law Analysis | 09 Apr 2020 | 12:35 pm | 2 min. read

Employers will require a sponsor licence before they can employ nationals from the European Economic Area (EEA) in the post-Brexit immigration system, which is scheduled to come into effect on 1 January 2021.

Although most businesses will currently be very busy dealing with the repercussions of the Covid-19 pandemic, the new immigration system is still on track to be introduced from the start of next year. It is therefore important that businesses wishing to continue to employ EEA nationals get their plans in order now.

At present, UK employers wishing to employ skilled workers from outside the EU must first apply to UK Visas and Immigration (UKVI) for a Tier 2 sponsor licence. Under the proposed new system, they will also be required to obtain a sponsor licence to employ EEA nationals.

Why apply for a sponsor licence?

We are urging businesses to consider applying for a sponsor licence now, if they haven't already done so, to prepare for the new immigration system. This will ensure that businesses which are heavily reliant on recruitment from the EEA will be able to continue recruiting talent and avoid skill shortages in 2021, subject to EEA workers meeting the relevant skill and salary requirements.

We expect there to be a surge in licence applications in the coming months, in anticipation of the end of free movement of workers from the EEA. This will naturally impact on sponsor licence application processing times.

We expect there to be a surge in licence applications in the coming months, in anticipation of the end of free movement of workers from the EEA. This will naturally impact on sponsor licence application processing times.

Some welcome changes are planned for the current points-based system (PBS) from 2021, which new and existing sponsor licence holders will benefit from:

  • the skill level required for a sponsored visa will be lowered from Regulated Qualifications Framework (RQF) level 6 to RQF level 3, or from degree level to A-level qualification standard - allowing employers with sponsor licences to recruit from a wider pool of talent;
  • salary requirements will be reduced, meaning workers on salaries from £25,600 per annum (currently £30,000 per annum) may now be eligible for sponsorship;
  • individual migrants may be able to 'trade' certain characteristics against the salary that they would otherwise be required to earn for the occupation in question;
  • the cap on the number of migrants sponsors can bring to the UK per year will be abolished;
  • visa applications will be streamlined – the 'resident labour market test', which requires employers to advertise a position in the UK before they can recruit a Tier 2 (General) migrant will be abolished.

How do I apply for a licence?

Employers that are interested in applying for a sponsor licence should review their current workforce and assess if they will be able to offer genuine employment skilled to level RQF3 or above to an employee. The process then involves completion of an application form and provision of certain corporate documents to the UKVI.

The UKVI will be accepting applications under the new system from autumn 2020 and is encouraging employers to apply early, even if not currently in a position to sponsor migrants under the existing system or sure if or when they will need sponsored migrants under the new system.

What if I already have a sponsor licence?

For those employers which are already licensed, reliance on that sponsor licence is likely to increase from 2021 given the broader pool of migrants which will be subject to the PBS.

Licensed sponsors are subject to extensive compliance obligations. Now is the time to conduct an audit and 'health check' to ensure all is in order, that practices and procedures are sufficiently robust and teams are appropriately trained on applicable requirements.

Existing sponsors may also wish to think about reviewing whether their key personnel are accurate and ensuring their registered branches or work sites are updated to facilitate intra-company transfers from an increased number of locations overseas, as well as auditing the nationality of their current workforce in order to plan for Certificate of Sponsorship allocation requests.