UK immigration reset removes lower-skilled roles from sponsorship

Employers need to prepare for skill level changes and salary updates affecting sponsored workers and urgently consider whether the roles they’re hiring for can still be sponsored going forward. That’s the message coming from immigration experts, following the government’s first formal statement of changes to the Immigration Rules. The reforms – set out in May’s White Paper – are being described as a ‘complete reset’ of the UK immigration system designed to reduce reliance on lower-skilled overseas workers and instead focus on developing the domestic workforce. We’ll ask an immigration expert how these changes impact recruitment and workforce planning.

There are three key areas of change for employers to get to grips with:

First, the skill level reset. From 22 July only RQF level 6 and above will qualify under the Skilled Worker route. That’s broadly equivalent to a UK bachelor’s degree, so roles must now require degree-level skills or responsibilities to meet the threshold. That shift in threshold means a sizeable number of roles will no longer qualify. The Home Office estimates that more than 100 occupations that previously met the old skill threshold will no longer be eligible. That includes many in hospitality, retail, admin, and junior IT, all of which will now fall outside the system unless they're regraded, redefined, or moved onto a new route.

The second key area of change is the introduction of a temporary shortage list. This is a limited concession for some sub-degree roles which the government considers critical to the UK’s industrial strategy or infrastructure. But there are tight restrictions – these workers can’t bring dependants, and they won’t benefit from salary discounts or reduced visa fees. It’s a short-term fix, not a long-term route.

Thirdly, there is the salary threshold rise. From 22 July, salary minimums are going up across the board. For new Skilled Worker applicants, the standard rate will jump from £38,700 to £41,700, and the discounted rate from £30,960 to £33,400. Even workers already in the system will be affected, depending on when their certificate of sponsorship was assigned – so employers need to check the detail carefully.

The Immigration Team here at Pinsent Masons is already talking to clients about these changes and earlier I caught up with Shara Pledger who heads up the team. First, the change to skill level – how significant is it?

Shara Pledger: “This change to the required skill level for sponsorship is really significant. In a way, it is just returning us to the position that we were previously in because if you looked at pre-Brexit immigration rules this indeed was the skill level that was needed for sponsorship, so it's not something that's never been experienced before. But of course it's been a long time, the best part of five years, since those rules were changed to downgrade that skill level and the impact that it now has in increasing that skill level back up to the equivalent of graduate level roles and it means about 180 sponsorship roles that as of right now are acceptable for sponsorship will not be acceptable for sponsorship from the 22 of July onwards. So, it's a big change and it means that for a lot of employers they just might not be able to recruit in roles that they were previously sponsoring in. For others, they may still have this sort of limited lifeline of being able to benefit from some new provisions, or some transitional provisions, to keep workers within those roles but it is going to become more difficult. So, this skill level change is really, really significant, and obviously is being employed as one of the methods that will be used to dramatically reduce the number of overall skilled workers in the UK.”

Joe Glavina: “The government is also bringing in a Temporary Shortage List. Tell me about that, Shara.”

Shara Pledger: “We're familiar with relying on certain roles that are classed as being very difficult to recruit for in the UK. So, we previously had the Shortage Occupation List, we're currently operating with the Immigration Salary List, and the Temporary Shortage List is effectively another iteration of that kind of approach but what's fundamentally different about the Temporary Shortage List is that focus on the word ‘temporary.’ The idea with roles that are included under this list is that they will not be sponsored for a significant period of time. It is for a temporary period to allow the UK labour market to make plans to recover, to adjust to the idea that sponsorship is not suitable for these roles. So, it means that for individuals that are going into new sponsorship as of 22 July on one of these codes included on that Temporary Shortage List, they will firstly receive less favourable visa conditions. So that means that means that they will not be able to benefit from salary discounts where they may previously have been able to do so, they will no longer be able to bring their dependents to the UK and anyone that's familiar with how immigration rules have changed for the adult social care sector will be familiar with the impact that that had on the number of applicants in those particular roles. But the real change in relation to this TSL is that it's also time limited. So, at the moment codes are only guaranteed to be on that list up to a maximum of 30 December 2026, and during that time more codes could go on, codes could come off. At the end of that period, the TSL could just completely change, be completely removed from the immigration rules, we just don't know. So, it does mean that for employers that are hoping to rely on that Temporary Shortage List, it is now much more uncertain about where that sort of labour will come from and how long they'll be able to support those people to remain with them in the UK”

Joe Glavina: “There’s also the salary threshold rise to consider, Shara. So from 22 July salary minimums are going up across the board. Thoughts on that.”

Shara Pledger: “Much like changes to change to skill level, we're absolutely not unfamiliar with changes to salary requirements. They are updated regularly, quite often on an annual basis in fairly modest increments, and it's not necessarily the case that the salary changes that are taking effect on 22 July are much, much more significant than ones that we've previously seen. It's not the kind of jump that we saw in April 2024 for example, when there was a huge increase in the minimum salary requirement for sponsorship. But what's quite different about this time is just the level of complexity that relates to it because we now have many, many different iterations of people who have been sponsored under different versions of the immigration rules and different salary requirements will now apply to them. So work that we're currently doing with a lot of our clients is to identify what roles do they currently sponsor in on a regular basis, or are they likely to need to be sponsoring it in future, and what will the salary requirements be for people in these different scenarios because it will likely be very different for them to re-sponsor a person that's already with them, compared to what it would be to sponsor somebody completely new to the UK. So, it's really trying to get a grip, I think, for organisations on how is this going to change for us? What does this do to our budgets, for example, and making sure that people are prepared for what's to come because while there is no need for immediate action - if you are already sponsoring somebody you don't suddenly have to uplift their salary because the rules are changing, that sort of thing wouldn't kick in until they're going to extend their status. But people need to know what's coming because what you don't want to do is get 6, 12, 18, whatever it happens to be, months down the line, and suddenly find out actually that cohort of workers is now going to cost us X amount more than what we were anticipating.”

Joe Glavina: “Finally, Shara, anything else for viewers to be aware of?”

Shara Pledger: “One thing that a lot of clients are asking us about at the moment is whether there is any update in relation to the Home Office suggestion that settlement periods will be increased from five years to 10 years. Now, unfortunately, at the moment there is no further update in relation to that but what is particularly interesting is that when this most recent set of changes to the immigration rules was announced there was nothing within it that would confirm when we could expect to see that change of the 5-year settlement to 10. That's quite different from some of the other changes that are anticipated. So that big cost increase to sponsorship for sponsors - the immigration skills charge - that's confirmed as likely to be taking effect before the end of the year. Contrast that with this settlement change, there is acknowledgement that there needs to be, probably, public consultation in relation to that and then no sort of long date as to when we can expect it. So for now, the only thing employers really can do is continue on the basis that there is a five-year settlement period and try and make decisions strategically based on that.”

This reset to the immigration system is just the start. The May White Paper sets out the government’s wider policy direction, but it’s the Statement of Changes that delivers the first wave of legal reforms, coming into force on 22 July. Further changes are expected later this year and, of course, we’ll keep you updated on that. Meanwhile, we’ve included a link to both the White Paper and the Statement of Changes in the transcript of this programme for you.

- Link to White Paper on immigration

- Link to Statement of Changes to the Immigration Rules