From 1st January 2021, the freedom of people to move between the UK and EU countries will end and the UK will introduce a new immigration system that will treat all applicants equally, regardless of what country they come from (except Irish citizens who are exempt from immigration rules, due to the pre-existing Common Travel Area arrangements).
From this date, all non-British/Irish nationals will require a valid immigration status/visa to live, work, and study in the UK.
This will not apply to EEA (European Economic Area) or Swiss citizens you already employ, who live in the UK now, and who have applied and been accepted to the EU Settlement Scheme (EUSS). EEA citizens must apply to the EUSS by the 30th June 2021 to preserve their right to live and work in the UK from 2021.
The government have created an Employer Toolkit to help Employers support EU citizens to apply to stay in the UK.
In a survey by campaign group the3million, at the end of October 2020, only 14% of companies said they were clear on the new rules from 31st December 2020. So here we look at the details you need to know.
Please note: The government is continually refining the immigration system and rules. The information in this Guide is correct as of 1st February 2022.
You may also be interested in our article "Brexit: get your business ready" that covers other areas of your business that may require action.
From 1st January, employers will need a sponsor licence to employ anyone new they wish to recruit from outside the UK (excluding Irish citizens). All Job Seekers/workers from outside the UK (excluding Irish citizens) will need a valid visa before they can travel to the UK, if they intend to live, work, or study in the UK.
If an employer regularly hires EEA nationals but does not yet have a sponsor licence, they should apply for one now at gov.uk.
Employers will be subject to a Civil Penalty if they are found to be employing illegal workers within the previous three years. The starting point for the calculation of the civil penalty is £20,000 before reductions are applied.
In March 2021, the government published a guide for sponsors, about the documents they need to keep, which you can see here.
Details of the EU Settlement Schemes (EUSS)
Employers can view EU workers’ right to work in the UK status, issued under the EU Settlement Scheme, at gov.uk.
The government issued guidance on making late applications to the EU Settlement Scheme at the beginning of April 2021.
If, as an employer, you find out that one of your employees (who you employed before 30th June 2021) has not applied to the EUSS in time and therefore does not now have the right to work in the UK, what should you do?
The government guidance says that you should not dismiss them but tell them to apply to the EUSS, where they will be given a Certificate of Application to show to their employer. Employers can also talk to the Employer Checking Service to confirm if their employee has applied or not.
If the employee has applied they will receive a Positive Verification Notice which lasts for six months, and hopefully during this period they will receive a Settled Status outcome (if they do not receive an outcome during this six months they will need to apply for a further Positive Verification Notice so that the Employer can continue to employ them). Employers should keep all records relating to this so they have a valid ‘statutory excuse’ to avoid a civil penalty. The government guidance relating to this only lasts until 31st December 2021.
Pre-Settled Status for EEA nationals living in the UK before 31st December 2020
There are no fees to pay for EEA nationals to apply for this status now. This is valid for five years but will lapse if the individual is absent from the UK for two consecutive years,, and will lapse if the individual does not reapply for settled status after 5 years (which means individuals would lose their right to work, rent property or access services in the UK; and could face deportation).
However, in December 2022, the High Court ruled that the requirements of the EU 'pre-settled' status scheme, for individuals to re-apply to get 'settled' status after 5 years, is unlawful because it requires them to re-apply to upgrade their settlement status. The Government initially said they would appeal this decision, however, in February 2023 it decided not to and the guidance for the EUSS will need to be amended in line with this guidance, and it is expected to be updated by August 2023. It is estimated that there are now 2.4 million individuals with pre-settled status living in the UK.
There are no restrictions on work or study during pre-settled status.
This status could be an option for individuals who do not fall into any other immigration category, and who already spend significant periods of time in the UK (for work reasons perhaps), but do not live in the UK, and will continue to need to spend similar amounts of time in the UK in the years ahead.
Settled Status for EEA nationals living in the UK before 31st December 2020
There are no fees to pay for EEA nationals to apply for this status now. This is available if people spend a continuous period of five years in the UK (with no more than six months absence in any 12 month period; there are a few exceptions where longer absences are allowed).
EU nationals who have the right to reside in the UK can claim means-tested benefits
In December 2020 the Court of Appeal confirmed that EU nationals who hold the right to reside in the UK cannot be excluded from claiming means-tested benefits. The case was brought by the Child Poverty Action Group (CPAG) on behalf of two Romanian nationals who had been granted ‘pre-settled’ status under the EU Settlement Scheme.
One man was severely disabled, the other was his carer, and they had been refused Universal Credit. This decision was found to be discrimination the grounds of nationality. The Department for Work and Pensions intends to appeal against the ruling by the Court of Appeal and does not have to implement the judgement until 26th February 2021.
How do employers get a sponsor licence?
Step one: You need to check your business is eligible
To get a licence, you cannot have unspent criminal convictions for immigration offences or certain other crimes, such as fraud or money laundering.
Step two: Choose the type of licence you want to apply for
The most common licences are Tier 2 or Tier 5 - you can apply for a licence covering either tier or both.
Tier 2 is for skilled workers who you want to employ long-term or permanently. It’s split into:
- General - the role must meet the job suitability requirements (there’s a suitable rate of pay and skill level)
- Intra-Company Transfer - for multinational companies which need to transfer employees to the UK
- Minister of Religion - for people coming to work for a religious organisation (for up to three years)
- Sportsperson - for elite sportspeople and coaches who will be based in the UK, see updates below**
Tier 5 is for skilled workers you want to employ on a temporary basis. It’s split into:
- Creative and Sporting - to work as a sportsperson (up to one year), entertainer or artist (up to two years), see updates below**
- Charity Worker - for unpaid workers (up to one year)
- Religious Worker - for those preaching, or performing pastoral and non-pastoral work (two years)
- Government Authorised Exchange - work experience (one year), research projects or training, for example practical medical or scientific training (two years) to enable a short-term exchange of knowledge
- International Agreement - where the worker is coming to do a job which is covered by international law, for example employees of overseas governments
**The UK launched an International Sportsperson Visa on 11th October 2021, for professional athletes coming to work in the UK “who can make a significant contribution to the development of their sport at its highest level in the UK”. This new Visa replaces the Tier 2 and Tier 5 Sporting visas above.
Step three: Decide who will manage the sponsorship within your business, and who will use the sponsorship management system (SMS).
Step four: Apply and pay a sponsorship fee
UK Visa and Immigration may need to visit your business before your application is confirmed.
Fees are between £536 and £1,476 depending on the type and size of your business. In July 2023 the Government announced large increases for work and visit visa fees and sponsorship certificates; date of the new fees tbc.
It’s estimated that sponsoring an individual skilled worker (without dependents) for five years can cost between £6-8k (including fees for the licence, sponsorship certificate, visa application, immigration skills charge [Employers must pay £1,000 per skilled worker for the first 12 months], the immigration health charge [for visas over six months], and any legal advice you need to take).
Step five: What happens after you apply
You’ll be given a licence rating if your application is successful. You’ll get an A-rated licence if your application is approved which lets you start assigning certificates of sponsorship to job seekers.
It can take up to eight weeks to receive a Sponsor Licence.
Your A-rated licence may be downgraded to a B-rating at a later stage if you do not continue to meet your sponsor duties.
If this happens, you will not be able to issue new certificates of sponsorship until you’ve made improvements and upgraded back to an A-rating. You’ll still be able to issue certificates to workers you already employ who want to extend, or who are switching from a Work Permit.
You must assign a certificate of sponsorship to each foreign worker you employ, which will cost you £199 per employee. This is an electronic record, not a physical document. Each certificate has its own number, which a worker can use to apply for a visa.
Your licence will be valid for four years.
More information on Skilled workers
From 1 January 2021, anyone you recruit from outside the UK for the Skilled Worker route will need to demonstrate that:
- they have a job offer from a Home Office licensed sponsor who have a ‘genuine vacancy’
- they speak English at the required level (B1, lower intermediate level) and may need to prove their competency by taking a test
- the job offer is at the required skill level of RQF3 or above (equivalent to A level)
- they’ll be paid at least £25,600 (which increases to £26,200 from 12th April 2023) or the ‘going rate’ for the job offer, whichever is higher (this rate was reduced in October 2020 from £35,800).
A ‘genuine vacancy’ - the Home Office will expect to be shown how the Employer/Sponsor came to identify the migrant worker it is wanting to sponsor. This may be through a formal recruitment exercise or it may be because the migrant is already working for the Employer under a different immigration category. The Home Office has guidance on what evidence to keep of how you recruited the migrant.
If the job will pay less than this – but no less than £20,480 (increasing to £20,960 from 12th April 2023)– the applicant may still be able to apply by ‘trading’ points on specific characteristics against their salary. For example, if they have a job offer in a shortage occupation or have a PhD relevant to the job.
A total of 70 points is needed to be able to apply to work in the UK – details are available at gov.uk.
These rates are based on gross basic salary only (you cannot include allowances and bonuses, benefits in kind, visa/relocation costs, or pension contributions). There are no regional salary thresholds.
Further information on which occupations are at the required skill level and the salaries for these occupations can be found in Annex E of the “UK points-based immigration system: further details” statement.
There will not be a general route for employers to recruit from outside the UK for jobs offering a salary below £20,480 (increasing to £20,960 from 12th April 2023) or jobs at a skill level below RQF3.
The Government made changes to the Skilled Workers Route on 6th April 2021, including changes to the Shortage Occupation list, the Eligible Occupations and Salary calculation rules, which you can see here.
The Home Office announced in December 2021, that from 15th February 2022, care workers, care assistants, carers and home care workers would be added to the shortage occupation list. They will need to be employed on a 12 month ‘health and care visa’ earning a minimum of £20,480 (increasing to £20,960 from 12th April 2023) to be able to work in the UK.
And in July 2023 the Home Office announced that Bricklayers, Plasterers, Roofers, Carpenters, Joiners and other Construction Worker jobs would be added to the "shortage occupation list" immediately.
How much are visas and the immigration health charge?
A Tier 2 Skilled worker visa will cost from £1,800 for a 12 month visa for a small sponsor company. Immigration health charges are £624 per year of visa from 27th October 2020(the Government announced, in July 2023, that this fee would increase to £1,035 per year; but date of implementation to be confirmed). If the visa is for up to 6 months then £312 will need to be paid for that period. If a visa is over 6 months then £624 will need to be paid.
Skilled workers who apply for a Health & Care visa, under Tier 2, in eligible health occupations with a job offer from the NHS, social care sector, or employers and organisations which provide services to the NHS will benefit from:
- fast-track entry
- reduced application fees
- dedicated application support
- an exemption from the immigration health surcharge.
Policy guidance for Tier 2 visa applications (updated October 2020) is available through gov.uk.
More information on Intra-company transfers
If you want to transfer a worker from a part of your business overseas to work for you in the UK, they can apply for the Intra-Company Transfer route. Applicants will need to be existing workers who will undertake roles that meet the skills and salary thresholds.
From 1 January 2021, workers transferring to the UK will need to:
- be sponsored as an Intra-Company Transfer by a Home Office licensed sponsor
- have 12 months’ experience working for a business overseas linked by ownership to the UK business they will work for
- be undertaking a role at the required skill level of RQF6 or above (graduate level equivalent), which is on the Standard Occupational Code (SOC) job list
- be paid at least £41,500 or the ‘going rate’ for the job, whichever is higher.
Permission for workers transferred to the UK on the Intra-Company Transfer route is temporary. Workers can be assigned to the UK multiple times, but they cannot stay in the UK for more than five years in any six-year period.
However, workers paid over £73,900 do not need to have worked overseas for 12 months and can stay for up to nine years in any ten-year period.There is no English language requirement for intra-company transfer visas.
In the March 2021 Budget, a new immigration category was announced which will be called the Global Business Mobility visa, which will launch by Spring 2022. This follows a review of the intra-company routes and whether to expand the representative of overseas business route to allow teams to come to the United Kingdom to set up a UK entity or branch.
Low Skilled Workers
There will be no visa route for low skilled roles, i.e. these below the RQF3 skill level (A level equivalent), which are usually roles in agriculture, retail, manufacturing, and haulage, for example.
The government had proposed a temporary transitional visa for industries that rely on lower skilled EEA workers, but this is not currently being implemented.
There will be sector specific seasonal visa programmes such as the Seasonal Agricultural Workers programme (which will give time limited visas within a quota system).
The Seasonal Workers Pilot for agriculture ran until the end of 2020. The government announced in December 2020 that the scheme would be extended to allow 30,000 seasonal workers to enter the UK in 2021 to pick and pack fruit and vegetables. The scheme allows workers from EU and non-EU countries to come to the UK to work. The Home Office announced in December 2021, that this scheme would continue until the end of 2024, with 30,000 visas available (that could potentially increase to 40,000).
At the end of September 2021, the Government announced a temporary U-turn on visas for lorry drivers and poultry workers - they would issue up to 10,500 temporary work visas to lorry drivers and poultry workers to ease chronic staff shortages that hit fuel supplies and other industries. This later increased to 11,000 work visas - 4,700 for HGV food drivers, 5,500 for poultry workers and 800 visas for pork butchers.
Employers must hold a Temporary Worker - Seasonal Worker sponsor licence to employ a HGV driver with a temporary visa. There has not been a large volume of applications to these schemes.
If you're an EU, EEA or Swiss Citizen who is employed or self-employed in the UK, but you are not primarily resident in the UK, then you are a Frontier Worker. 'Not primarily resident' means that you have been in the UK for less than 180 days in the 12 months prior to making an application for frontier worker status, or that you've returned to your country of residence at least once in the last six months, or twice in the last 12 months before making an application (unless there are exceptional reasons).
On 10th December 2020, the government launched the Frontier Worker Permit Scheme. Individuals who are employed or self-employed in the UK as a frontier worker before the end of December 2020 may be eligible for a frontier worker permit which will enable them to continue to do this. If you’re a frontier worker, you’ll need a permit to enter the UK to work from 1st July 2021, alongside your passport or national identity card. Before 1st July 2021, you can just use your passport or national identity card to enter the UK.
You can use your permit to enter the UK as a frontier worker and show your right to work, rent and access benefits and services, including NHS healthcare, if you meet the relevant eligibility requirements.
There is no fee to apply for the permit, and you do not have to pay the immigration health surcharge. The permit will last for five years if you are an employed worker, and for two years if you are self-employed. The permit will not provide leave to enter or remain in the UK.People who start working in the UK for the first time after 1st January 2021 will not be eligible for a Frontier Worker permit, and you'll need to apply to work in the UK under the new points-based immigration system.
The government guidance is available at GOV.UK.
Other immigration routes into the UK
A full list of worker routes can be read in the points-based system introduction for employers document.
Visiting the UK after 1st January 2021 for non British/Irish nationals
Visitors are able to come to the UK for 180 days at any one time to attend meetings, interviews, conferences, gather information for their work, give and receive training, holiday, and do some short-term studies. The rules are changing from 1st December 2020 and you can see the new visitor rules at gov.uk.
Visitors should not undertake any work or long-term study using this route as only limited business or work activities are allowed (as above). Therefore, this visitor route cannot be used for work placements or internships.The visitor rules from 1st December 2020 will now:
- permit study of up to six months under the standard visit route. All study must be undertaken at an accredited institution, except recreational courses undertaken for leisure that last no longer than 30 days
- allow drivers on international routes to collect as well as deliver goods and passengers in and out of the UK.
Visitors from certain countries – e.g. China, India, South Africa – need to get a ‘visitor visa’ before they arrive in the UK.From 1st January 2021, EEA nationals will not need a visitor visa (the same as nationals from e.g. the USA, Canada and Australia now).
In May 2021, the Home Office confirmed that EU nationals can visit the UK to attend a job interview - but should make sure they bring evidence with them of the interview to gain entry to the UK. If they are successful at getting the job they must re-enter the UK to work under a valid visa.
UK ancestry applies to Commonwealth citizens with a grandparent born in the UK who intend to come to the UK to work.
Students must be sponsored by a Higher Education Institute or School who hold a sponsor licence to study in the UK under Tier 4 licence arrangements. EEA nationals will be included in this category if they arrive in the UK from 1st January 2021.
The Graduate Visa will be available to international students who have completed a degree in the UK from 1st July 2021. This will enable international students to remain in the UK and work at any skill level for two years after they have completed their studies. It will be an un-sponsored route.
International students who complete a PhD from summer 2021 can stay in the UK for three years after study to live and work. This will make it easier for some of the best young international graduates to secure skilled jobs in the UK.
The government has temporarily modified the requirement that a student visa holder must undertake their studies in the UK to qualify for immigration permission under the graduate route because of the Covid pandemic.
Investors (the ‘Golden Visa’)
Those individuals with at least £2 million who can transfer these funds to the UK and invest in qualifying assets will be able to continue to apply for visas under the Tier 1 (Investor) category.
If the investment is maintained for a five year period, the individual would qualify eventually to settle in the UK. Settlement is available in three years if they invest £5million, or two years if they invest £10million.
On 17th February 2022 this Visa was cancelled, to crackdown on 'corrupt elites who threaten our national security', as relations with Russia were strained prior to Russia’s invasion of Ukraine. Future investors will be encouraged to apply for an "innovator" visa if they can demonstrate "an investment strategy that can show genuine job creation and other tangible economic impacts"; this is likely to be available from Autumn 2022. Since the Golden Visa was launched in 2008 approximately 12,000 such Visas have been granted.
United Kingdom and Switzerland Services Mobility Agreement (SMA)
This agreement came into effect on 1st January 2021, and in December 2022 was extended until 31st December 2025. This allows British and Swish professionals to work in each other's countries (accounting, legal, advertising etc). British professionals can work in Switzerland for up to 90 days in a calendar year without a Swiss work permit. Swiss professionals can work in the UK for up to 12 months in any 24 month period under the Global Business Mobility services supplier visa, where they have a UK Employer who is a sponsor licensed for this route.
Visas that allow the holder to work in the UK without a sponsor
The Global Talent route (which has replaced the Tier 1 system) is designed to attract recognised global leaders and promising individuals in science, humanities, engineering, the arts and digital technology.This will be extended to EEA nationals from 1st January 2021. Individuals will be granted permission to work without restriction if they’re endorsed by a specialist endorsing body and have adequate English language skills. An employer will not need to be a Home Office licensed visa sponsor to employ a migrant under the Global Talent route.
As of July 2020, the current list of approved endorsing bodies is as follows:
- The Royal Society, for science and medicine
- The Royal Academy of Engineering, for engineering
- The British Academy, for humanities
- UK Research and Innovation, for science and research
- Tech Nation, for digital technology
- Arts Council England, for arts and culture.
In the March 2021 Budget, it was announced that the Global talent visa would be reformed.
Youth Mobility Scheme
The Youth Mobility Scheme will enable around 20,000 young people (aged 18 to 30 years old) to come to the UK to work and travel each year. At the moment young people from Australia, Canada, Hong Kong, New Zealand and other countries use this scheme which allows unrestricted work. This will apply to EEA nationals on a reciprocal basis with their individual EU country after January 2021.
‘Non-sponsored’ points based system
The government intends to introduce a ‘non-sponsored’ points based system where visas are granted based on academic qualifications, age, earnings potential etc. without the need of a job offer. This will be implemented after 1st January 2021.
High Potential Individual Visa
On 30th May 2022 this new visa route opened. This is for graduates of certain top overseas universities (Harvard, MIT, Kyoto University for example), who want to work or look for work in the UK after completion of their degree. Applicants for the visa must have completed a bachelor’s degree or PHD from a recognised university in the last 5 years. The individual needs to make their own visa application, an Employer will not need to sponsor the individual. Those individuals with a bachelor’s degree will get a 2 year visa; those with a PhD will get a 3 year visa. At the end of the 2 or 3 years individuals can apply for another vis to continue their employment in the UK.
Announced in the March 2021 budget, a new 'elite' points-based visa will be available, from March 2022, to attract and retain the most highly skilled, globally mobile talent to the UK. The government is particularly keen to attract highly skilled professions in academia, science, research and technology. Within this visa there will be a ’scale up’ stream, enabling those with a job offer from a recognised UK scale-up to qualify for a fast-track visa.
Checking new employees right to work
You’ll still need to check that all new employees have a right to work in the UK before they start work (as you should do now).
EEA and Swiss citizens (excluding Irish Nationals) can use their passport or national identity card to prove they can work in the UK until 30 June 2021. Until this date, employers cannot require these citizens to prove their immigration status under the EU Settlement Scheme. Home Office guidance says you will not need to make retrospective checks for employees who worked for you prior to 31st December 2020, who are from the EEA, from July 2020.
After 1st July 2021, employers must ask new EEA employees for proof of their immigration status – which will either be under the EU Settlement Scheme or via the new immigration system.
The government updated their Right to Work Checks, an Employers Guide on 18th June 2021, and it now includes information on checking the right to work of EEA nationals after 1st July 2021.
EEA nationals who have applied for their immigration status under the EU Settlement Scheme (EUSS) will not have a physical document to prove their status. Their status will need to be verified online by the employer.
Non-EEA nationals will continue to have evidence of their immigration status in either their passport and/or a Biometric Residence permit. Biometric Residence Permits were introduced in 2008 and are the only evidence of lawful residence currently issued by the Home Office to most non-EEA nationals and their dependants.
If an employee has a time limited right to work in the UK, Employers must carry out a further check around the time of the expiry of the employees current visa. If an employee needs to extend their working visa and has made an application to extend this, they will continue to have the right to work in the UK until a decision on their application is made - but Employers should ask to see a copy of their application etc.
More about the EU Settlement Scheme
If an employee has been outside the UK for more than six months in a 12 month period, their continuity of residence will normally have been broken - however there are exceptions where single periods of absence of up to one year are allowed if there was an important reason.
Examples of an 'important reason' include pregnancy, child birth, serious illness, study, vocational training, overseas posting or compulsory military training.
The government recently confirmed that being quarantined to protect public health would be accepted as an important reason and they have published guidance for EUSS applicants who have been affected by illness or travel restrictions due to COVID-19.
Freelancers from outside the UK, including those from the EU that have not obtained pre-settled or settled status, will be unable to offer freelance services personally in the UK, unless they have a relevant work permit and an employer to sponsor them. They can continue to work for UK companies of course, but only if they do not physically do the work in the UK.
Our Crunch advisors are only able to answer accountancy related questions. If you have an employment question, please either leave a comment below or phone the Acas Helpline on 0300 123 110.
If you are an employer and need ongoing professional help with any staff/freelance issues, talk to Lesley at The HR Kiosk - a Human Resources Consultancy for small businesses. Our fees are low to reflect the pressures on small businesses and you can hire us for as much time as you need.