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End of transition period guidance: law firm preparation for the end of free movement

This paper forms part of a series.

The aim of this guidance is to highlight the changes to the UK immigration system that will occur at the end of the UK-EU transition period on 31 December, most recently outlined in a policy statement on 13 July 2020.

Based on this, changes outlined below will apply irrespective of whether the UK and EU have concluded an agreement by 31 December and lay out steps that can be taken now to mitigate effects.

The issues outlined include:

  • the EU settlement scheme
  • sponsorship licences
  • financial and strategic planning
  • cross-border workers

This note does not replace legal advice or a consultation on an individual basis with the relevant regulators.

We cannot accept any liability resulting from any action or lack thereof taken on the basis of the information contained in this note.

Points for solicitors to consider before the end of the transition period

EU Settlement Scheme

Employers should:

  • look to ensure all relevant employees have registered under the EU Settlement Scheme
    • any employees of European Economic Area (EEA)/Swiss nationality and their non-EU family members living in the UK before 31 December 2020 should apply for the EU Settlement Scheme
    • those who do not apply by 30 June 2021 will potentially become unlawfully present in the UK, meaning they will be unable to continue working here legally
    • none of the above applies to Irish nationals and Irish frontier workers, who are not required to apply under the scheme
  • try to ensure that any planned moves to the UK for EEA/Swiss residents are carried out before 31 December 2020, factoring in possible delays due to visa processing times for non-EEA/Swiss family members
  • prepare and train personnel for the right to work checks which will need to be carried out after 30 June 2021 on EEA/Swiss national employees
    • before 30 June 2021, a valid passport or ID card will be sufficient, and the government has indicated right to work checks will continue being done using an online platform, which permits remote checks
  • if necessary, familiarise themselves with sponsorship processes: EEA/Swiss nationals arriving in the UK from 1 January 2021 onwards will not have the automatic right to work, so they may require sponsorship

Sponsorship licences

Employers should:

  • review any existing sponsorship licences to ensure that:
    • the sponsor licence is up to date with all relevant overseas and UK offices (particularly those in the EU) being approved as linked entities or work sites on the sponsor licence – this is particularly important for intra-company transfer (ICT) migrants
    • there are enough certificates of sponsorship for the future, with a view to applying for more if needed
    • all relevant individuals who may need to be sponsored from 1 January 2021 are identified and the sponsor is aware of the requirements to meet for the individuals to be sponsored
    • relevant records and reporting duties are being maintained for existing sponsored employees and internal audit checks are occurring
  • apply for a sponsorship licence if the firm does not already have one, ensuring:
    • sponsors have human resource systems in place to comply with sponsor duties, including record keeping and monitoring of migrants
    • the organisation has individuals who are aware of the sponsorship process, sponsor responsibilities, and are able to take on ‘key personnel’ roles assigned to them under the sponsor licence
    • sponsors are committed to employing overseas migrants in line with the Home Office requirements, for example, guaranteeing to pay the migrant at a specific salary level
  • be aware of the impact of coming changes to the immigration system regarding sponsor licences:
    • sponsor licences for workers will be renamed ‘Skilled Worker licences’ and ‘Intra-Company Transfer licences’
    • existing Tier 2 sponsors to be automatically granted a new Skilled Worker licence or Intra-Company Transfer licence and receive an allocation of Certificates of Sponsorship
    • new checks will be made to ensure that sponsors are ‘genuine and solvent’, and sponsors will need to show that roles are credible and meet salary and skills requirements where applicable. Key personnel responsible for maintaining the sponsor’s status will undergo criminality and ‘other security checks’, which we are awaiting further information on

Financial and strategic planning

Employers should:

  • be aware of how the new ‘points-based system’ will work, including ‘tradeable’ points for skilled worker routes:
    • whichever is higher of the general salary threshold (£25,600) or the specified ‘going rate’ for an occupation must be met. Flexibility is provided based on whether the employee has an ‘academic’ PhD relevant to the role and/or whether the job is listed on the Shortage Occupation List
    • the new effective minimum salary to sponsor a Skilled Worker visa for solicitors will be £34,300 as the ‘going rate’ for the occupation. If the applicant is a ‘new entrant’, it will be £24,010. This will apply to all non-British or Irish nationals from 1 January 2021
  • plan for increased costs as of 1 January 2021, due to increased monitoring/support of EEA/Swiss nationals (right to work checks, Tier 2 sponsorship)
  • be aware of additional sponsorship related costs for each sponsored worker:
    • Immigration Health Surcharge will rise to £624 per year in October 2020
    • Immigration Skills Charge payments of £364/£1,000 per year (depending on business size)
  • factor in timing for the below:
    • an English language test may be required
    • be aware of the maintenance requirement – usually requires funds to be in applicant account for at least 90 days (unless sponsor certifies maintenance)
    • processing times vary depending on type of immigration permission
  • be aware of changes to the Immigration Rules from January 2021, which will affect routes under which individuals can work for you:
    • skilled work route – requires sponsorship, salary and skills thresholds
    • unsponsored work route – limited to highly skilled individuals, proposed two-year immigration permission, unlikely to be activated until 2022
    • graduate route – to be launched in summer 2021 for international students to look for work after they graduate – which will provide two to three years’ permission to live and work in the UK without a sponsor, depending on degree level
    • existing routes include:
      • Tier 5 (Youth Mobility Scheme) – two-year immigration permission for certain nationalities aged 18 to 30
      • visitor route – be aware of restricted ability to enter for work purposes
      • students – restrictions on ability to work although doctorate extension scheme has more flexibility
      • intra-company transfers
    • there will be no specific immigration route for many ‘low-skilled’ workers, so prepare for possible issues with recruitment
  • keep up to date with the rules that are in place when the employee starts here, regarding right to work checks, which remain unchanged until 30 June 2021. We’re awaiting further clarity from the government regarding the evidence required for right to work checks completed between 1 January and 30 June 2021
    • it appears that right to work checks will be utilised via an existing online system, which permits remote checks via video
  • ensure that visa costs for British citizens travelling within the EEA/Switzerland are identified when planning any travel from 1 January 2021 onwards

Cross-border workers

Employers should be aware:

  • the intra-company transfer (ICT) routes are to remain broadly as they currently are, but will also apply to EU/EEA nationals
  • however, currently a worker transferring under the ICT provisions must have either been working overseas for at least 12 months or have been paid a minimum (relatively high) salary. The government has not referred to the salary in the latest briefing except to say that applicants will be subject to a ‘different salary threshold than the main skilled worker route’
  • next year, applicants must be in roles skilled to RQF3 and meet the requirement of being employed by the business for a minimum period prior to the transfer (12 months for employee or three months for graduate trainees)
  • the existing ‘cooling off’ rules, which required a 12-month waiting period for those returning to the UK as skilled sponsored workers in many circumstances, will be removed. Instead, an overseas ICT transferee must not hold entry clearance or leave to enter/remain as an ICT transferee for more than five years in any six-year period, except where they qualify to be granted up to nine years on the basis of their salary

Employers should therefore:

  • ensure that employees of UK nationality who are exercising EEA free movement rights abroad apply for parallel residence schemes in their country of residence. The requirements may differ between countries, so it is important to ascertain exactly what residence requirements are needed for each employee working in the EEA/Switzerland
  • consider whether proposed moves outside of the UK could affect EEA/Swiss nationals’ eligibility to apply for or maintain EU settled status under the EU Settlement Scheme