What the Government’s new migration rules will mean for employers?

A new plan to cut legal immigration has been announced by the Government, the repercussions of which are likely to be felt by employers in every sector.  We examine the details of the latest Home Office announcement and what the new immigration system could mean for employers.

Skilled Worker Route

The Skilled Worker route is the most popular route used by employers to recruit talent from Europe and the rest of the world, with over 130,000 visas granted in 2022. The Home Secretary has announced plans for the current salary threshold of £26,200 for a Skilled Worker visa to be increased to £38,700.

This would, in effect, prevent employers from being able to recruit for a large number of their roles that pay below this level. The new threshold is more than twice the current national living wage and higher than the current median salary in the UK. According to estimates, only 6% of jobs that qualify for a Skilled Worker visa have a salary above the new threshold.

Employers may experience longer durations in filling vacancies as they search the local market for recruits. There were an estimated 987,000 vacancies in the UK as of the end of August 2023. We are likely to see this number increase, and competition for recruits drive up the salaries demanded by employees to fill those vacancies. The effects of this on the wider economy and inflation is predicted to pose another threat to employers in the long run.

The details around this announcement are changing rapidly, with almost daily updates from the Government regarding what sectors may be exempt from needing to meet the threshold. Employers and employer groups such as UK Hospitality, have already begun lobbying the UK Government for exemptions for their industry.

Shortage Occupation List

The Shortage Occupation List, a list of roles to which a 20% discount is applied to the minimum salary thresholds, will be scrapped from April 2024. A new Immigration Salary List will replace the Shortage Occupation List. It has been reported that roles on the new Immigration Salary List will have a general discount applied to the salary threshold, but what that discount is, and more importantly, what roles will be covered by it, has not yet been revealed.

In the past three years, the Shortage Occupation List has been used to respond to sector needs. It includes jobs like truck drivers, caregivers, fruit pickers, and bricklayers. It is unclear whether the new Immigration Salary List will be equally as reactive in meeting the needs of the market.

Health and Social Care

The Home Secretary announced that employers in the care sector must be regulated by the Care Quality Commission to qualify for a sponsor licence going forward.

Workers on a Health and Care visa will also be barred from applying for visas for their dependants, known as Spouse or Family visas, effectively preventing those employees from bringing their families with them when accepting roles in the UK.

Statistics in June 2023 stated almost 6 in 10 (58%) of all visas granted to foreign workers were in the social care sector. The new restrictions may act as a significant deterrent for recruits from abroad if these roles meet the new, higher salary thresholds at all.

Next Steps for Employers

In the immediate term, employers should consider accelerating their recruitment drives to fill any vacant roles before April 2024.

In the medium and long term, employers should review their workforce, starting with collating a list of roles they currently have filled by sponsored workers or workers that may require sponsorship in the near future. The roles should be re-evaluated to ensure the salaries paid from April 2024 will exceed any relevant thresholds.

If employers cannot, or decide not to pay above the relevant salary threshold, then they should consider alternative options for filling such roles from April 2024. These options include:

•            Recruiting internally within the organisation;

•            Restructuring the team entirely;

•            Commencing recruitment from the wider UK market;

•            Outsourcing certain roles and functions within their organisation;

•            Use of agency staff.

The changes are likely to be a source of anxiety and stress for employees who will now be looking at whether their role meets the relevant threshold and indeed whether they will be able to remain in the UK at all from April 2024. Employers are reminded of their duty of care towards their employees; adequate support should be made available to employees who need it. For employers that have access to support services as an employee benefit, it may be useful to remind employees of the availability of such services.

Employers should consider approaching the next few months transparently and holding an open dialogue with their workforce to address any concerns. In the event an employer considers that it is unlikely they will be able to continue sponsoring an employee, they should communicate this decision as early as possible, as well as their reason for doing so.

The Geldards’ Business Immigration Team is available to assist with any queries arising from the latest immigration rules changes. The Team can be contacted here