Global mobility post-Brexit: what options for employers?

EU nationals coming to the UK to work after 31 December 2020 are now subject to the UK’s new points-based immigration system. For employers wishing to employ EU nationals, this is likely to mean sponsorship – but that’s not the only option, says Alice Williams - an employment lawyer at our sister company, Capital Law.

Sponsor licence for Skilled Workers

A sponsor licence will enable businesses to employ EU nationals who have arrived in the UK this year, and who do not have another available means of working lawfully in the UK, for example British citizenship. If businesses are considering sponsorship, there are various factors to bear in mind, especially those businesses used to unfettered access to the EU labour market:

The expense

The fee for a licence is £536 for a small or charitable sponsor or £1,476 for a medium or large sponsor. This fee must be paid when applying for the licence and every 4 years on renewal. A fee of £199 must also be paid for the Certificate of Sponsorship for each sponsored employee, in addition to an Immigration Skills Charge of up to £1,000 per year. Sponsors may also wish to assist their employees with individual visa fees (which can be up to £1,408 per sponsored employee), although this is not mandatory.

The obligations of a sponsor

Being a sponsor is a significant responsibility and one which the Home Office describes as a “privilege”. The sponsor is agreeing to accept certain duties for an individual over and above that of an ordinary employer and significant trust is placed on sponsors to comply with the relevant rules and guidance, which are lengthy and can be complex to interpret.

Management and administration time

Sponsors must have ‘Key Personnel’ to look after the licence and report to the Home Office. This can mean additional time and resources. There must always be Key Personnel in place which must be considered when succession planning.

Candidates meeting the eligibility criteria

Although there have been significant changes to the system in relation to Skilled Workers including a lowering of the minimum salary and skill level and the abolition of the Resident Labour Market Test requiring sponsors to advertise the role in a certain way for a specified time period, it is still quite restrictive, not least because it does not cover low-skilled roles. With sectors such as hospitality and agriculture heavily relying on EU workers historically, the end to free movement and lack of an available immigration route is likely to cause issues as the effects of the pandemic wear off.

Other options

There are other ways EU nationals can come to the UK that don’t involve sponsorship, including as ‘visitors’ or ‘frontier workers’ or using some of the less common visa options, such as the seasonal worker route or as an entrepreneur.

However, strict eligibility criteria apply, and some routes (such as the visitor route) only allow the individual to work in very limited circumstances.  As businesses adapt to the end of free movement, it is becoming clearer that certain situations just aren’t catered for under the new immigration system. For example, it will be increasingly difficult for businesses to rely on EU contractors to come to the UK for specific projects.  Employers will need to find inventive solutions to such issues including becoming sponsors or upskilling UK staff to plug the gap.

The effect of COVID-19

Due to the ongoing impact of the pandemic and the ensuing travel restrictions, the full consequences of the end to free movement and the new immigration system have not yet been realised. It has also been difficult to fully evaluate whether the skills shortages are due to the pandemic and where the real issues lie, with many of the sectors which would ordinarily heavily rely on EU workers, such as hospitality being shut down.

On the other hand, the pandemic has shone a light on remote working. Businesses have found that workers they have previously sponsored, or would have sponsored are able to work effectively from their home country.

However, businesses should take care before readily making this option available as there are other considerations which must be borne in mind such as tax, health and safety and data protection implications in addition to the day-to-day management of the individual.

Due to the pandemic, it is not yet clear what the true impact of the end of free movement has been on businesses, with recruitment being on hold and the economy struggling.

Businesses are unlikely to see the real effects until restrictions are lifted, with some of the hardest hit sectors being food processing, hospitality and agriculture which have ordinarily heavily relied on recruiting EU nationals.

Moving to the UK/EU

EU citizens who moved to the UK by 31 December 2020 can continue to live and work in the UK so long as they apply for the EU Settlement Scheme by 30 June 2021. Employers should be playing a key role in promoting the scheme to ensure that no employees are left without the right to work. Similarly, UK citizens who moved to the EU before the end of the year can continue to live and work there so long as they register as a resident in that country by 30 June 2021.

Similar to EU citizens in the UK, UK citizens travelling to the EU after the end of last year will not have an automatic right to be there and would need to comply with the country’s immigration rules.  Employers will need to make their employees aware of this to prevent last minute snags at the border.

This article was initially published on the website of our sister company, Capital Law.