Fast-track or long haul? What ‘earned settlement’ could mean for employers and their staff

This blog was co-authored with Shannon Willett. 

On 20 November 2025, the government published a policy paper and launched a consultation on A Fairer Pathway to Settlement making it clear that it is serious about delivering on the promises set out in its White Paper earlier this year which aim to reduce the UK’s reliance on overseas labour and bring net migration down. Settlement (also referred to as “indefinite leave to remain”) is the current focus for the government in meeting these aims.

Eligibility for settlement

Under the proposals, settlement will no longer be granted automatically after a fixed period (which is currently five years in most cases). Instead, migrants will need to ‘earn’ settlement by demonstrating sustained suitability, contribution and integration requirements. The proposed baseline for settlement in the UK for all affected individuals will be 10 years and there would then be factors which may increase or decrease this period. 

It is also proposed that minimum mandatory requirements would apply to all applicants in order for them to be granted settlement, including: 

1. Suitability: meeting suitability requirements such as not having a criminal conviction, not having any current litigation and no NHS, tax or other government debt.

2. Integration: meeting an English language requirement and passing the ‘Life in the UK’ test.

3. Contribution: having contributed to the Exchequer by having annual earnings over £12,750 for a minimum of 3 to 5 years (this is currently subject to consultation), in line with the current thresholds for paying income tax and National Insurance Contributions, or an alternative amount of income.  

It is not currently proposed that the changes would apply to certain categories of individual, including those who have already been granted indefinite leave to remain, those with pre-settled or settled status under the EU Settlement Scheme, and migrants on the five-year Family route. 

The government has confirmed that these changes will be retrospective and, subject to certain exceptions (such as those set out above), will affect those who are currently in the UK on a pathway to settlement. However, this is subject to consultation. 

The qualifying period

The baseline qualifying period of 10 years may be reduced through positive indicators or extended on the basis of negative indicators. Under the proposals, negative indicators could potentially add an additional 20 years onto the qualifying period for some individuals. Sponsored workers who are in roles below a graduate skill level may be subject to a baseline qualifying period of 15 years.

Positive indicators may include having a higher English language proficiency, taking part in volunteering or community work, working in vital public services or being a higher rate tax payer. Under the proposals, applicants who have earned a taxable income of £125,140 in the three years immediately prior to applying for settlement may see the time period reduced down to three years only.

Negative indicators could include previously overstaying immigration permission, accessing public funds or arriving in the UK through ‘irregular’ means or as a visitor. 

Implementation 

An implementation date has not yet been set for these changes. However, the consultation closes on 12 February 2026, and it is anticipated that the government will seek to act quickly to put its proposals into force. We may therefore see these significant changes coming in as early as Spring next year.

Considerations for employers

The changes are likely to mean that employees who are or can be sponsored as Skilled Workers will need sponsoring for longer periods under a sponsor licence held by the employer. This will come with increased administration, responsibilities and cost for the employer (not least as the Immigration Skills Charge is paid upfront by the sponsoring employer for every year that a worker is sponsored and is set to increase to up to £1,320 per year on 16 December 2025). Employers should factor in these costs to budgeting forecasts and otherwise make sure that they have sufficient processes and policies in place to meet their sponsor duties. 

Actions that employers may want to consider now are:

1. Encouraging any eligible employees to apply for settlement sooner rather than later – it almost goes without saying that any employees who already qualify for settlement should apply as soon as possible and before the changes take effect.

2. Providing support for affected employees – it is understandable that these proposals will cause concern and uncertainty for those affected. As details unfold, employers will want to consider what support they can provide to their workforce to help their teams feel informed and able to consider the options available to them. 

3. Auditing impact on workforce – employers may want to consider what the impact could look like across their workforce, including where employees are sponsored and will require an extended period of sponsorship if the proposals come into force. Employers who rely on overseas workers may also want to consider contingency plans if the changes impact on the numbers or willingness of individuals to come to work in the UK. 

4. Responding to the government consultation – employers could consider responding to the consultation to set out the impact to their workforce. 

We advise many of the UK’s best-known employers, as well as overseas businesses, on the immigration and employment aspects of recruiting and employing overseas nationals in the UK. If you have any questions, please get in touch with our Business Immigration team.