Stephen Kerr, head of immigration and visa services for Deloitte in Scotland & Northern Ireland looks at the Sector Based Immigration scheme and the effects and results it has had in the six months since its introduction.

On 30 May 2003, the Government introduced new opportunities to work in the UK. In so doing, it recognised that over a number of years certain areas of the economy have struggled to recruit sufficient staff from the resident workforce. It is seeking to solve that problem through the introduction of the new Sector Based Scheme (SBS).

Prior to May, the main route into the UK labour market for overseas workers was via the work permit scheme. This was, and remains, aimed at skilled workers – individuals with either an academic qualification (university degree, college diploma, etc) relevant to the job in question or someone who has several years’ experience performing specialist skills acquired through doing the type of job for which the work permit is sought. Unless a UK employer demonstrates to the Home Office’s satisfaction that the position is skilled in this sense, a permit will be refused.

In a nutshell, the problem for employers in so-called ‘lower skilled’ industries has been this – in recent years, the resident workforce (people from the UK and, broadly speaking, western Europe) has not provided a sustainable source of labour. This is due to a number of factors, including the level of pay on offer and the working conditions. Put simply, people weren’t willing to do the job at the going rate. This meant employers had to look to immigrant workers. The main pool of immigrant labour – work permit holders – was, however, unavailable to them because the jobs were viewed as unskilled and did not qualify for work permit status. Given that the spectre of companies employing illegal immigrants began to rear its ugly head, you can quickly see why a new plan of action was needed.

Following consultation with industry, it was clear that the problems were most acute in the hospitality and food manufacturing industries. At present, the SBS will operate only in those sectors but it could be widened in the future so expect the Government to keep matters under review.

The scheme allows UK employers in those sectors to recruit people aged between 18 and 30 from outside the EEA (the European Union plus Norway Liechtenstein and Iceland) to undertake low skilled work. It is, in effect, a new branch of the work permit arrangements. The SBS is quota based with a certain number of permits being released every few months. The current quota is being released as follows:

Although there is an overall limit to the number of permits there is no limit to the number of applications that an employer can make.

The types of jobs that SBS permit holders are allowed to do in these sectors have been agreed by Work Permits (UK) – the Government agency responsible for administering the SBS – sector representatives, Jobcentre Plus, the TUC and the CBI. These jobs have been identified as ‘hard to fill’ and a list is available from the Work Permits (UK) website.

Employers must advertise the jobs prior to applying for an SBS permit for the overseas worker because only in this way can they properly demonstrate that they cannot recruit from the resident labour market. As a minimum, WP(UK) expect the jobs to be advertised through the Jobcentre Plus network and the European Employment Service (EURES).

The vacancy must have been advertised for a minimum of four weeks in the six months prior to making an application for an SBS permit. While employers are also encouraged to advertise through other appropriate media (newspapers, etc) if they bypass Jobcentre Plus/EURES they will need to provide a detailed explanation why other means of advertising were deemed to be more suitable. Employers will also have to show why any resident worker applications have been unsuccessful.

SBS is a temporary scheme in the sense that it only gives participants permission to work in the UK for up to 12 months and does not lead to permanent settlement. This has two consequences:

Almost six months in and initial indications are that take up in SBS permits has been good. Many employers have welcomed the new system and the quota appears to be working well. It is a step forward in the creation of a flexible system of immigration in the UK.