LIBOR transition: government proposes legislation to deal with 'tough legacy' contracts
Out-Law Guide | 11 Aug 2020 | 8:35 am | 18 min. read
The UK Home Office has introduced a variety of relaxations to cater for these challenges. However, as borders start to re-open and the number of infections decrease, the Home Office announced on 29 July that many of these concessions will shortly be coming to an end. Individuals will no longer be able to extend their visa automatically, and are expected to take all reasonable steps to leave the UK where it is possible to do so or to apply to regularise their stay in the UK.
The Home Office published guidance on immigration provisions for UK visa applicants and temporary UK residents. It has a coronavirus helpline: 0800 678 1767 or [email protected] Please note that the Home Office will only speak to an employer regarding an individual with that individual's written consent.
Some UK Visa and Citizenship Application Centres (UKVCAS) opened for existing customers on 1 June 2020 and further centres opened on 3 July. Customers can check online which UKVCAS centres are open.
Priority and super priority services have resumed at some overseas centres.
The Home Office has provided reassurance that those in the UK legally but whose visa is due to expire, or has already expired, and who cannot leave due to the coronavirus outbreak, will not be regarded as an 'overstayer', or suffer any detriment in the future.
Initially, the Home Office announced that those whose visas expired between 24 January and 31 May and could not leave the UK were eligible for a visa extension to 31 May 2020. That was subsequently extended to 31 July 2020. On 29 July, it confirmed that such visa holders will get an automatic further extension until 31 August 2020, to allow them to leave the UK or apply to remain in an appropriate route.
Our understanding is that those affected are no longer required to complete the CIT's online visa extension application form, which required a reason for why an extension is required. Additionally, they will not get written confirmation of being in this 'grace period' until 31 August. They will not be eligible for any further automatic visa extension beyond 31 August.
On 29 July, the Home Office confirmed that the conditions of a visa holder's stay in the UK between 1 and 31 August will be the same as the conditions of their leave, meaning they can continue to work, study or rent accommodation during August 2020 ahead of their departure.
If individuals intend to leave the UK but are not able to do so by 31 August 2020 they may request additional time to stay - known as 'exceptional assurance' - by contacting the Coronavirus Immigration Team (CIT). The CIT will provide further advice on what individuals need to do to request an assurance and the evidence that the individual must provide in order to show they are unable to leave by 31 August. This may include, for example, a confirmed flight ticket with a date after 31 August or confirmation of a positive coronavirus test result.
Right to work checks must be kept up to date and employers should verify with the Home Office the status of those with expiring leave who are still employed.
We understand that assurance requests will be made via a smart form. As yet, there are no specific evidential requirements but that may change depending on the nature of requests received over time.
It is not yet known what an individual's legal status will be during the period from 31 August until a decision is made on an assurance application and, therefore, the impact that may have on their rights - for example, to work - during this period. Applicants should carefully consider if an assurance application is the best course for them, as opposed to seeking to otherwise extend or switch.
New guidance issued by the Home Office on 31 March confirmed that NHS frontline workers (and their families) with visas expiring between 31 March and 1 October 2020 have an automatic extension for one year to enable them to focus on fighting coronavirus. Although the legal basis for this is unclear, it has been confirmed that this extension does not have to be requested - it will be automatically applied. Initially, this was said to cover doctors, nurses and paramedics employed by the NHS. On 1 May, the list of frontline workers was expanded to include biochemists, physiotherapists, therapists, social workers and many more. The update confirms that those eligible can be employed by the NHS or the independent sector.
This extension will apply to any relevant individual affected, so not just those on sponsored Tier 2 or 5 visas for example. The update also confirmed that frontline workers can work at any NHS hospital during the coronavirus outbreak if their sponsor can maintain their sponsorship duties, and that sponsors are not required to update the sponsorship management service (SMS) with the individual's new work location. Frontline workers can carry out supplementary work in any role at any skill level during the coronavirus outbreak, and there is no restriction on the number of hours they are able to work.
Finally, pre-registered overseas nurses who are currently required to sit their 'first skills' test within three months, and to pass the test within eight months, will now have this deadline extended to the end of the year. If they do not pass on the first attempt, they will have until 31 May 2021 to pass the exam.
The Home Office has confirmed that original visa terms and conditions will continue to apply where an individual is able to benefit from an extension, automatic or otherwise, due to the pandemic although the precise legal basis for this is not yet clear. Our advice therefore remains that anyone whose visa is about to expire and who is eligible to extend or switch to another category should do so as soon as possible.
Migrants in the UK and looking to move to a long-term UK immigration category (e.g. moving from a Tier 2 Intra-Company Transfer to Tier 2 General) often cannot switch within the UK, they must leave and apply from their home country. The Home Office is exceptionally allowing those who intend to stay to switch in-country.
This ability to switch in-country is available for those whose leave to remain in the UK expires before 31 August 2020. The guidance was updated on 7 August to confirm that those with leave expiring after 1 September can also rely on this switching concession if their application is urgent. The examples provided of when this may be the case include where the individual needs to start a job or commence study. It is noted that this concession is being kept under review.
All other eligibility rules for the category the individual is switching into will continue to apply, including cooling off provisions.
The Home Office has confirmed that those switching in the UK can benefit from the terms of their leave remaining the same until their application is decided. If an individual is switching into work or study routes, they may be able to commence work or study whilst their application is under consideration.
On 2 July the Home Office announced that if a visa applicant has had their fingerprints taken as part of an application previously, the Home Office may reuse the fingerprints already given. Applicants will be emailed with instructions on how to send the Home Office an image of their face and supporting documents. This will be done via an identity verification (IDV) app, which will guide them through how to submit a photograph of themselves and their travel documents. We understand that all documents already uploaded through the online visa application will be attached to the application - these will not need to be uploaded again. Applicants will, however, be able to attach documents if they wish to do so.
This will mean a large number of those applying in the UK before 31 July will not need to attend a UKVCAS or an SSC service point appointment to provide biometric information. If applicants cannot send the information through the instructions given, they will be able to book an appointment.
For those submitting applications from within the UK, some application service centres are now re-opening. A list of centres which opened on 3 July has been published. More centres are opening later in July and early August. In addition some of the Service and Support Centres still run by the Home Office have also re-opened however appointment availability is more limited than usual.
On 20 April, the Home Office published guidance on temporary provisions for Tier 4 sponsors and those on student visas affected by Covid-19.
The guidance contains many welcome concessions which will be withdrawn "once the situation returns to normal". Where a concession applies to a student, a clear record of this must be retained on their file and noted in their Certificate of Acceptance for Studies (CAS) evidence or sponsor notes section.
Points to note include:
Commencing studies ahead of visa approval
English language requirements
Many sponsored workers are now working from home. Normally their sponsor would have to report such a change in place of work to the Home Office within 10 working days. The Home Office has confirmed that where such a change is due to the coronavirus pandemic no such report will be required. However, other changes will need reported in the usual way.
As with students, the Home Office's latest guidance confirms that it will not take enforcement action against sponsors who continue to sponsor employees absent due to coronavirus. Such absences do not need to be reported – that could be due to illness, self-isolation or inability to travel due to travel restrictions.
Further, sponsors do not need to withdraw sponsorship if an employee is absent from work without pay for more than four weeks. A clear record and paper trail should be kept in all circumstances.
Having robust absence reporting processes and records is key at the moment. If audited further down the line, sponsors should be able to evidence authorised absences related to coronavirus.
Employers will be relieved to hear that on 3 April, the Home Office finally published some guidance on the application of furlough to sponsored migrants in the UK. The guidance confirmed:
Frustratingly this guidance is silent on whether employers should report the changes to salary. Until guidance is published to the contrary we would recommend that employers err on the side of caution and that any changes to salary are reported against the relevant migrant's Certificate of Sponsorship, as usual, using the Sponsor Management System. It will be important to confirm the reason for the reduction in the 'free text' section of the report, and to keep a copy of the wording submitted as part of the report for compliance purposes.
Employers should also retain a copy of the company-wide policy that is being implemented to avoid redundancies so that employers are able to justify any salary decreases in a Home Office audit.
Looking ahead, we recommend that the date at which salary reductions are due to come to an end should be diarised so that employers remember to report the increase on within 10 working days of salary being increased.
The Home Office guidance confirms that if you have issued a CoS or CAS and the sponsored employee or student has not yet applied for a visa they will still be able to do so. Where the start date for the employment or course has changed, the Home Office will not automatically refuse such cases. The example provided in the guidance is that the Home Office may accept a CoS which has become invalid because the employee was unable to travel as a result of coronavirus.
Caution should be taken in respect of this update as the Home Office has caveated this guidance stating that "such situations will be considered on a case by case basis".
Employers wishing to use this concession are advised to keep full details of why an application has not been submitted. This could be a paper trail of the discussions that took place as well as evidence of the relevant visa application centre being closed within the timeframe the application was required to be submitted.
Sponsors should note that the Home Office sponsor priority service, which aims to fast track certain administrative applications within five working days for a £200 fee, is temporarily closed and it is unclear when this will reopen. Sponsors should therefore be mindful that any updates submitted (such as change of Authorising Officer) will be subject to the 18 week service standard. It is extremely important for sponsors to ensure they are on top of their sponsor administrative duties at this time.
The Home Office has now released guidance allowing sponsors to have employees start work before their visa application has been decided if the following conditions are met:
It appears that this would apply to sponsors in a range of useful scenarios at present including that of migrants waiting for the decision on Tier 2 Change of Employment applications. The guidance is ambiguous as to whether this only applies to those whose visas expired by 31 July 2020 (or 31 August if subject to the grace period). Our view is that this should not be restricted according to visa expiry given that migrants will often change employment other than by reason of visa expiry.
Employers should be mindful that sponsors' reporting responsibilities start from the date of the individual's employment, not from the date that their application is granted. Employers should refer to the Right to Work Check section below to ensure they are complying with current regulations.
If an employee commences work on the basis of an assigned CoS and their visa application is subsequently refused, sponsors must terminate their employment and should keep full written records of their prompt action taken following a refusal for compliance and future audit purposes.
Most UK visa application centres overseas have reopened, but local restrictions may apply in some cases. Some English language testing facilities are also resuming services. Alongside travel restrictions, any persisting closures will naturally delay the ability to bring people from other countries to the UK. The situation in a particular country should be checked on a case by case basis. A practical issue to bear in mind for this group is that if such affected individuals are sponsored, their certificate of sponsorship must be used to apply for a visa within three months or it expires.
We understand the Home Office will review such applications on a case by case basis and exercise discretion.
Similarly, those whose passports are with closed visa application centres may be prevented from travelling until it is returned to them. A practical consideration for employers is that sponsored migrants are generally given a 30-day entry clearance vignette to come to the UK. Such issues and travel restrictions may prevent individuals from being able to travel within that 30-day period. The Home Office has now confirmed that those affected can request a replacement vignette, with revised validity dates, free of charge until the end of 2020. The replacement will be valid for 90 days.
This can be requested by emailing [email protected] or arranging the return of the individual's passport to the nearest visa application centre, if open, in line with local processes. Emails should include the individual's name, nationality, date of birth, GWF reference number and "REPLACEMENT 30 DAY VISA" in the subject line. The replacement visa itself can be obtained when visa application centres reopen. This does not apply to visit visas.
These individuals will not be penalised for having been unable to collect their biometric residence permit (BRP) during the Covid-19 period.
British nationals overseas can apply for British passports online. If required to book an appointment, they will need to check if their nearest application centre is open.
Those who need a new passport for urgent travel will have to contact the Foreign and Commonwealth Office to discuss their options, which may include applying for an emergency travel document.
The Home Office has made temporary changes to the employer process for conducting right to work checks in response to the coronavirus pandemic.
As of 30 March 2020, the following temporary changes apply:
Checks continue to be necessary, and employers must continue to check the prescribed documents listed in the government's right to work checks guidance. It remains an offence to knowingly employ anyone who does not have the right to work in the UK.
The new temporary process for conducting right to work checks is:
If a job applicant or existing worker cannot show their documents then employers must contact the Home Office Employer Checking Service. If the person has a right to work, the Employer Checking Service will send employers a 'Positive Verification Notice'. This provides them with a statutory excuse for six months from the date in the notice.
This guidance was issued on 30 March and is not stated to be retrospective. Given some employers may have taken a commercial view and followed this approach prior to the guidance being issued, where this was due to the current coronavirus pandemic, we suggest such records note that it was an "adjusted check undertaken due to Covid-19" as referenced above to address any potential future challenges as to the rationale for the format of check undertaken. Follow up checks should be completed as referenced below.
The Home Office has stressed that this is a temporary measure. It will release further guidance in advance of the concessions ending to give employers sufficient time to revert back to the previous right to work check process.
Employers should keep a record of all individuals checked using this new process, as they will be asked to carry out retrospective checks on existing employees who:
Employers should mark the retrospective check: "The individual's contract commenced on [insert date]. The prescribed right to work check was undertaken on [insert date] due to Covid-19".
The retrospective check must be carried out within eight weeks of the Covid-19 temporary measures ending, and both checks should be kept for the employer's records. The employer must end the employment if it finds the employee does not have permission to be in the UK when the retrospective check is completed.
11 May 2020
LIBOR transition: government proposes legislation to deal with 'tough legacy' contracts