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26 February 2024

The latest UK immigration changes – What employers need to know

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Posted by: HRi

The UK has experienced an unprecedented influx of immigrants since the pandemic’s onset. The most recent estimates, up to June 2023, reveal a surge in net migration, reaching 672,000—marking a significant uptick from pre-pandemic levels. In December 2023, the UK government announced the Legal Migration and Border Strategy. It’s five-point plan aimed at curbing net migration.

In these uncertain times, businesses find themselves at a crucial juncture. Not only to stay informed but to actively understand and navigate the imminent changes. This holds especially true for those currently employing or planning to recruit talent from beyond the UK borders.


What are the key changes in UK Immigration Law?

Skilled Worker minimum salary increase

The salary threshold for skilled worker visa applications is set to increase by almost 50%, catapulting from £26,200 to £38,700. Sponsors of Skilled Worker visas must align with the going rate for the job, ensuring compliance with the new minimum threshold. Although the purpose of this change is to maintain wage parity, it presents challenges for businesses. This is particularly the case for businesses that are reliant on sponsoring low-paid skilled workers. This change, however, will not affect health and care workers including doctors, nurses, care workers. It also does not affect those on national pay scales such as teachers.

The 30% lower minimum salary requirement continues to apply for individuals aged 26 and under, along with post-doctoral researchers. Recent updates have provided clarity assuring that the £38,700 salary threshold will not impact those already holding a Skilled Worker visa or those who have applied for one before this change comes into effect.

This change comes into effect on 4 April 2024.


Increase in UK Immigration Health Surcharge fees

Established in 2015, the Immigration Health Surcharge (IHS) ensures migrants have access to healthcare in the UK through the NHS for the duration of their visa. These fees have seen a substantial increase of 66%:

  • For adults, the IHS fee for each year a visa is held has surged from £624 to £1,035.
  • Students, student dependants, or those seeking leave to remain under the Youth Mobility Scheme, as well as children under the age of 18, now face a IHS fee escalation from £470 to £776 for each year a visa is held.

The IHS fee for UK healthcare is part of the immigration application and although the HIS is an annual expense, the complete amount is required to be paid upfront as a lump sum. Th alongside other visa application fees . This could make it difficult for individuals to pay if their employer is not picking up the cost. It is worth noting, these fees do not apply to health and care workers.

The fees increased on 6 February 2024.


The Shortage Occupation List will be replaced

The Shortage Occupation List represents roles recognised by the UK Government as being in short of supply within the resident labour market. Currently, qualifying roles can benefit from a 20% salary discount compared to the going rate for the particular job. However, this list and the associated discount will discontinue from 4 April 2024. The Shortage Occupation List will be replaced with the Immigration Salary List. There will be a significant reduction in the number of qualifying roles in the Immigration Salary List. Therefore, employers who rely on the 20% discounts currently offered may encounter an increase in costs.

The Migration Advisory Committee will provide guidance on the job roles that will continue to benefit from a lower salary threshold. Employers could encounter difficulties in recruiting talent for specific positions. Affected employers will need to re-evaluate their workplace planning and recruitment strategies in light of the updated list.


Right to work penalties surge

Performing thorough checks has been a long-standing requirement, but the consequences have escalated. Penalties for employing an illegal worker have tripled since February 13, 2024, with the maximum civil penalty soaring from £20,000 to £60,000. The starting point for the first breach has also increased from £15,000 to £45,000. Employers must ensure they are familiar with the code of practice for preventing illegal working to ensure compliance and mitigate risks effectively.


Increased minimum income requirement for family applications

Family applications are set to undergo a substantial shift, marked by an increased minimum income requirement. The current threshold of £18,600 will increase to £38,700, introducing a phased implementation. Starting with a rise to £29,000 on April 11, 2024, followed by an increment to £34,500 later this year, and ultimately reaching £38,700 in early 2025. Existing family visa holders in the UK won’t be subject to these new thresholds, providing a degree of relief. However, the gradual progression poses financial challenges for employees aiming to bring family members to the UK. Employers should be mindful of these personal difficulties and recognise potential impacts on employee well-being and work performance.


Youth Mobility Scheme (YMS)

The Youth Mobility Scheme (YMS) offers young adults aged 18 and above from participating countries the opportunity to explore life in the UK for a limited period. Andorra and Uruguay joined the scheme on 31 January 2024, complementing existing participating countries. These include Australia, Canada, Iceland, India, Japan, New Zealand, Taiwan, South Korea, Hong Kong, and Monaco. The age limit for citizens of Australia, Canada, and South Korea applying under this scheme will be raised from 30 to 35 years. This brings it in line with the age limit for nationals of New Zealand.

Employers may leverage this expansion since individuals under the Youth Mobility Scheme have unrestricted work conditions. Nonetheless, it is important to note they are prohibited from working as a professional sportsperson or engage in certain forms of self-employment. Unlike skilled workers, they do not require a visa sponsorship.


Key Steps for Employers

When adapting to these changes, employers should prepare for increased costs, potential challenges in recruitment, and the need for flexibility in adapting to the revised immigration policies. Understanding how these changes might affect employee demographics and preferences can be essential for long-term talent management strategies.

Employers also need to ensure they have a consistent approach to what visa costs the business will cover on behalf of workers. Employers’ mays consider establishing arrangements for employees to repay the IHS over a defined period, allowing the business to recover sponsorship costs throughout the employee’s tenure. This may also involve clawback arrangements to recover costs in the event of the employee’s leaving early.

The substantial increases in right to work civil penalties call for employers to ensure they have robust systems and processes in place.

Employers should be cognizant of the personal and professional challenges that may arise for employees due to the increased minimum salary thresholds for family visas. Increased financial stress and challenges in family reunification could affect employee morale and productivity. Employers should be attuned to the well-being of their workforce. To help maintain a positive workforce employers should consider implementing supportive measures.

Overall, employers need to ensure they have robust systems. They should conduct regular internal audits of their right-to-work records, and assess HR procedures and systems related to right-to-work checks. These steps will help mitigate risks that can be financially crippling for many SME employers.

If your business requires support or assistance in reviewing policies or ensuring you have a robust system and procedures in place, we can help you source an HRi accredited HR and People consultant to work with your business.