Regional race to secure sponsor licenses
For almost 70 years, British employers have had rich pickings from the European talent pool and foreign workers have made up vital proportion of the UK’s workforce, thanks to free movement among European Economic Area (EEA) states. As Britain’s time in the European Union comes to an end, as will the guarantee that new recruits from the EEA will be able to take up work in the UK, as a points-based immigration system is introduced for those who want to live, work or study in the country.
From 1 January 2021, prospective overseas workers will have to meet the 70-point threshold to be granted a Tier 2 visa to work in the UK and businesses will be required to hold a Home Office approved sponsor license to hire foreign talent. Businesses which fail to apply for sponsor licenses soon run the risk of missing out on the overseas workers they rely on, creating skills gaps in their workforces and limiting future growth.
Ensuring a reliable and steady stream of the right employees is essential for businesses in every sector and even more crucial for competitive industries with high staff turnover rates. Simply relying on homegrown talent is not enough and businesses must ensure they are prepared to legally continue to hire workers from abroad.
The coronavirus pandemic has already disrupted the international employee market as 765,000 foreign-born people of working age* have left the UK in the past year, with a bigger fall in EU citizens than the rest of the world. This mass exodus makes the talent pool shallower and this will only be exaggerated by the end of free movement in January.
The South East of England has always taken a disproportionate slice of the global employment pool. London is one of the world’s major financial cities – the high concentration of industry giants, huge amounts of international investment and the supporting infrastructure makes the capital the destination venue for skilled migrant workers coming to the UK. The focus on London creates recruitment barriers for businesses based outside of the area, forcing such organisations to work harder to make themselves attractive to those moving to the country from abroad.
Our recent survey on businesses in Yorkshire and Lincolnshire found that skills shortages is a medium to major concern for over 50 per cent of respondents. To minimise these concerns and secure skilled talent from outside of the UK, businesses in the Midlands and North must act quickly and be prepared. As the free movement deadline creeps ever closer, demand for sponsor licenses is expected to soar which could create administrative backlogs.
Finding the right talent can be a long and arduous process, and this will be even more so if a business is not legally approved to hire from abroad. To simplify processes come January and avoid a skills shortage, regional employers should initiate their sponsor license applications now.
This is what you need to know as a regional employer seeking to employ talent from the EU.
Without free movement from the EU, there is going to be a higher demand for sponsor licenses as more workers require sponsorship. We anticipate this process taking longer than usual, but if a business does not have an approved license by 1 January 2021, it will be illegal to hire talent from outside of the UK. Foreign workers will only be eligible to enter the UK for work purposes if they have a Tier 2 visa, which requires a job offer from a sponsor license holder. Holding a sponsor license and simplifying the visa process is a good way of attracting talent to live and work outside of London.
To qualify for the Tier 2 skilled workers visa route, prospective employees must speak English at the required level and be accepting a job offer at the required skill level that roughly equates to A Levels and pays a minimum salary of £25,600, as well as the offer being from an approved sponsor license holder.
Sponsors will be required to undergo checks before the license is approved. Businesses will have to prove they are genuine, solvent and the roles being recruited meet the salary and skill requirements. There will be criminality and security checks on senior personnel and key users of the sponsor license, with further checks for those recruiting for education and teaching children.
Sponsor license applications are made directly to the Home Office via the UK Visas and Immigration service† . We are recommending employers planning to recruit internationally apply for their license as soon as possible to avoid contending with admin delays. There is a license fee that applicants are required to pay, and businesses must pay a £624 immigration health surcharge to cover the cost of medical insurance for their employee’s time in the UK.
Employers with EU workers among their existing workforce will be required to hold a sponsor license unless their current employees are granted settled status in the UK. Any EU citizens in the country before 31 December 2020 are eligible under the EU Settlement Scheme, providing the application is completed by June 2021. If the employee has not been granted settled status by June 2021, their employer will need a sponsor licence to continue their employment and their legal status in the UK.
Businesses across the UK must be ready for the end of free movement to keep its effects to a minimum. This is even more strongly the case for regional employers attracting the talent they need to their businesses, so they should be preparing by understanding the points-based system, planning recruitment budgets and applying for sponsor licenses now.
*https://www.telegraph.co.uk/business/2020/11/10/covid-pushes-jobless-rate-highest-since-2016/
† https://www.gov.uk/guidance/recruiting-people-from-outside-the-uk-from-1-january-2021
Mini is a Partner and Head of Employment in York at Langleys Solicitors, having joined the firm in 2016. She has over 20 years experience in the field of employment law having trained initially as a Barrister, going on to qualify in 1996. Mini advises on all areas of employment law but she has a particular specialism in discrimination cases, executive terminations, restructures and TUPE issues.
