Business Immigration – A guide for employers

In this guide, we set out the key elements of the UK’s business immigration system and the routes available for employers who wish to recruit from overseas

29 April 2021

Introduction

The UK’s immigration system underwent significant change as a result of Brexit and the end of freedom of movement for European nationals on 31 December 2020. UK employers wanting to recruit migrant workers need to understand the new immigration regime and, in particular, how the changes affect the recruitment and employment of EU nationals. At present, there are two main business immigration routes enabling overseas nationals to work in the UK – the EU Settlement Scheme and the Points Based System. In this guide, we address the key issues for employers to consider under these routes.

The UK’s Immigration System

With effect from 1 January 2021, everyone (except for UK and Ireland nationals) requires immigration permission if they want to work in the UK. 

The majority of overseas nationals wanting to work in the UK will gain immigration permission through either:

  • the EU Settlement Scheme – available to nationals from the EEA and Switzerland (referred to as EU nationals in this guide) who were in the UK before 11pm on 31 December 2020 and certain of their family members; or
  • the Points Based System.

The EU Settlement Scheme (EUSS)

Following the end of freedom of movement between the UK and EU member states, any EU nationals who arrived in the UK before 11pm on 31 December 2020 will need to apply for settled status under the EUSS in order to retain the right to live and work in the UK. Applications must be made by 30 June 2021 otherwise the person will no longer have the right to work in the UK without obtaining alternative immigration permission.

Employers may be faced with challenging decisions if they employ any EU nationals who have failed to apply, or have made an unsuccessful application, to the EUSS before the 30 June 2021 deadline. You may want to take advice on the steps you can take now to minimise this risk, including how to encourage EU employees to apply under the scheme.

Family members of EU nationals living in the UK before the 31 December 2020 deadline may be able to apply under the EUSS. There are different rules for family members depending on their nationality, their relationship to the EU national and the date of entry into the UK.

EU nationals who were not in the UK before 11pm on 31 December 2020 are not eligible to apply under the EUSS and will be subject to the same rules as non-EU nationals under the PBS.

The Points Based System (PBS)

All nationals from outside the UK and Ireland looking to work and/or study in the UK who aren’t eligible to apply under the EUSS and don’t have an alternative route of entry will need to obtain a visa under the PBS.

The main routes include:

  • Skilled Worker – intended for skilled roles which are sponsored by a UK employer.
  • Intra-Company Transfer – intended for overseas employees moving to a linked UK entity.
  • Global Talent – intended for leading individuals in academia/research, the arts and digital technology who have been endorsed by an official body.
  • Start Up – a route for entrepreneurs who have been endorsed to set up a business in the UK.
  • Student – students are sponsored by an educational provider, but have the ability to work in the UK (subject to various restrictions).
  • Graduate – this route will be open from 1 July 2021 for individuals who are already in the UK under a student visa and who meet various eligibility criteria. The visa allows the graduate to stay in the UK for 2-3 years to look for, or undertake, work. There are no restrictions on the type of work that graduates can do under this type of visa.
  • Investor – available for high net worth individuals who provide financial investment in the UK.
  • Innovator – a route for individuals who are experienced in business and intend to run a business in the UK.

This guide focuses on the Skilled Worker and Intra-Company routes as these are the most common routes to employ overseas nationals in the UK.

Skilled Worker

This route is available to skilled migrants with a job offer from a UK employer which holds a sponsor licence (see below). Critically, employers must only sponsor migrant workers where there is a genuine vacancy and must keep documents to show that this is the case.

In order to qualify for sponsorship under the Skilled Worker route, the role must be:

  • in an eligible occupation (as set out in the ‘Appendix Skilled Occupations’ of the Immigration Rules)
  • offered at a minimum salary level (in most cases, this will be £25,600 or the 'going rate' for that particular job (whichever is higher))
  • sufficiently skilled (at or above “RQF Level 3”, which is A level qualifications or equivalent).

In addition, applicants must meet minimum English language requirements and, if they are applying from outside the UK, hold a prescribed level of funds in their bank accounts (although employers can underwrite this financial requirement).

There are significant costs associated with Skilled Worker visas and these costs (together with the processing times of obtaining visas) need to be factored into recruitment processes.

A Skilled Worker visa can be issued for up to a five year period, but provided the individual continues to meet the eligibility requirements, they can apply to extend their visa as many times as they like. This route also allows the individual to apply for Indefinite Leave to Remain (i.e. the permanent right to live and work in the UK without restriction) after five years, provided various criteria have been met.

Intra-Company Transfer (ICT)

The ICT route is open to employers (who hold a sponsor’s licence) seeking to transfer an employee from an overseas entity to an entity in the UK that is directly linked by common ownership or control. As with the Skilled Worker route, the role must be sufficiently skilled (although in this case it must be at or above degree level - otherwise known as “RQF Level 6”) and must meet minimum salary requirements (usually £41,500 or above or the going rate for the role, whichever is higher). Importantly, there is no requirement for the employee to meet any English language requirements.

ICT staff can stay in the UK for a period of up to five years in any six year period (or nine years in any ten year period if they meet certain ‘higher earner’ requirements). This route does not lead to Indefinite Leave to Remain.

Sponsorship

Migrants who are working under the Skilled Worker or Intra-Company Transfer routes must be sponsored by a UK employer. In order to sponsor an employee, the employer must hold a sponsor licence, which involves making an application to the Home Office. It typically takes around eight weeks for the Home Office to process the application, although a priority processing service is available in some circumstances.

There are a number of requirements to become a sponsor and the Home Office may arrange a compliance visit to ensure that the sponsor licence is genuinely required and that the business understands and is able to comply with the duties that come with it (see below).

Sponsor duties

Employers with a sponsor licence must comply with a number of duties as a condition of their licence. These sponsor duties include:

  • reporting various matters to the Home Office within a prescribed time frame (such as absences or changes in the migrant’s or the employer’s circumstances)
  • record-keeping (including retaining copies of passports, contact details, adverts and recruitment documentation).

The Home Office monitor compliance on an ongoing basis and it may undertake an audit at any time to ensure the business is complying with its duties. Visits can be impromptu or pre-arranged. Sponsors will be required to show that they have systems in place to prevent illegal working and comply with their sponsor duties, and information about sponsored employees will need to be available for inspection by the Home Office.

Failure to comply with sponsor duties can lead to severe penalties, including revocation of the sponsor’s licence, which would result in all sponsored migrants having their leave curtailed to 60 days.

Preventing illegal working and right to work checks

All UK employers (whether sponsors or not) are required to prevent the employment of illegal workers by conducting a “right to work check” on all employees before the start of their employment. If an employer is found to have employed an illegal worker and has not conducted right to work checks, they risk a civil penalty of up to £20,000 per illegal worker and potentially criminal sanctions in certain circumstances.

There will be different considerations for right to work checks for employees who have made an application under the EUSS and the rules around these checks will change after 30 June 2021.

Employers will need to make sure that they have systems in place to conduct and record right to work checks in a legally compliant way, and that they avoid any discriminatory treatment of individuals in how these are carried out.

Other Routes

There are a wide range of other immigration routes available for overseas nationals outside the EUSS and the PBS, including:

Visitor visa

Individuals wishing to come to the UK for short periods not exceeding six months can apply for a visitor visa, which allows them to carry out certain specified permitted activities. Importantly visitors cannot undertake paid employment and should be aware that the “permitted activities” are fairly narrow.

Examples of permitted business activities for visitors include: attending meetings, conferences and interviews, gathering information for employment overseas or being briefed on the requirements of a UK based customer (provided that any work for the customer is performed outside of the UK).

Frontier Worker permits

EU nationals employed or self-employed in the UK, but not primarily resident here can apply for a Frontier Worker permit (if they meet certain requirements). This route will only be available to individuals who worked in the UK at least once in the 12 months prior to 31 December 2020. The deadline to apply for a Frontier Worker permit is 30 June 2021.

Representative of overseas business visa

Individuals can apply to come to the UK where they are the sole representative of an overseas business intending to set up a wholly owned subsidiary or register a UK branch for an overseas parent company.

We have been working with many employers to help them plan for these changes. If you have any questions about your workforce and/or the new points-based immigration system, please get in touch with Huw Cooke, a Senior Associate in our Employment team.

This guidance note gives general information only and is not intended to be an exhaustive statement of the law. Although we have taken care over the information, you should not rely on it as legal advice. We do not accept any liability to anyone who does rely on its content.

Key contact

Huw Cooke

Huw Cooke Senior Associate

  • Employment
  • Business Immigration Services
  • Data Protection

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