Get your head around the Points Based System, sponsoring a non-EEA national and prepare for further future changes with this guide.
The UK Points Based System (PBS) forms a major element in the most comprehensive overhaul of UK immigration legislation in the last 30 years. In November 2008, Tier 2 of PBS replaced the Work Permit Scheme and other employment related schemes. Any employer wishing to sponsor a non-EEA national, or extend the permission of current non-EEA employees to work must first obtain an appropriate licence through the sponsorship licensing system.
The introduction of PBS and particularly the replacement of the work permit scheme by Tier 2 affects all UK employers who:-
- transfer group employees from overseas; or
- need to look beyond the borders of the EEA to recruit in order to address skill shortages for example; or
- who currently employ work permit holders.
Employers who have previously worked with the work permit scheme will find some of the themes in Tier 2 familiar, particularly the need, where the individual is being newly recruited into the employer group, to test the resident market by advertising in prescribed ways. Tier 2 does, however, differ from the Work Permit Scheme in that two new criteria have been introduced: English language ability and a maintenance test.
The process under PBS from an employer’s perspective has changed in three significant ways:-
- As mentioned above, a UK employer wishing to sponsor a non-EEA national must first be registered on the Government Sponsorship Register
- Once registered, the employer is then able to issue Certificates of Sponsorship (CoS) itself, via access to an online system called the Sponsor Management System rather than make an application to the UK government. This process is self policing at issuing stage as it is the employer’s responsibility to ensure that the appropriate criteria have been met prior to issuing a CoS. The UKBA will carry out periodic post issue checks. If a CoS is found to have been issued incorrectly, the employee in question may be asked to leave the UK and the employer may be downgraded or removed from the register
- Thirdly, under the old work permit scheme, the application process was two fold; a work permit application and then a visa/residence permit application made by the employee. There is now one visa/residence permit application only. This has two main consequences. Firstly the visa/residence permit application is critical as it is the only application made by the individual. Secondly, as the vast majority of applications will be submitted to British Diplomatic Posts overseas much more local support is required by the candidate.
PBS has always been heralded by the Government as one which is flexible and can be adapted to suit the needs of the UK at any time. This ability to flex has been demonstrated recently. In August, the UK Border Agency (UKBA) issued new guidance for sponsors, which incorporates a number of significant changes with immediate effect. Further changes were announced in September which will take effect next year. The September announcement accepts the recommendations of the Migration Advisory Committee (MAC) in relation to Tier 2 of the Points Based System. Both the revised guidance and the acceptance of the MAC recommendations represent a greater obligation on businesses to employ resident workers in these tough economic times where unemployment figures are still high.
The main changes in relation to Tier 2 from the August changes include:
- A new exemption to the requirement for positions to be advertised via JobCentre Plus has been introduced, where the job is in the role of director, chief executive or legal partner, and the salary is £130,000 or above or where there will be stock exchange disclosure requirements
- Where the salary has been reduced, a change of employment application (and new certificate of sponsorship and leave application) will be required unless key requirements are met
- All salary changes, including the above, must be reported to the UKBA via the Sponsor Management System, other than changes due to annual increments, bonuses or natural progression in the same job (not promotions)
- Where a migrant worker’s ‘core duties and/or responsibilities change, or where their position in the hierarchy of the sponsoring organisation changes, for example, due to promotion, this is to be treated as a change of employment.’ A change of employment requires the sponsor to issue a new CoS and the migrant must make a fresh application for leave, which must be approved before they can start work in their new job. Employers should carefully consider whether any changes require change of employment action, including whether a resident labour market test needs to be carried out for the new role
- Where a migrant worker has been supplied from one organisation to another on a contract basis, the sponsor will be the organisation which has full responsibility for determining the duties, functions and outcomes of the job the migrant is doing
- Where a migrant is carrying out work for a third party on behalf of the sponsor, the migrant must be contracted by the sponsor to provide a time-bound service or project. They must not be contracted as agency workers
- Where the migrant is an inter company transfee they must not be directly replacing a settled worker.
In February 2009, the Migration Advisory Committee (MAC) was asked to report on a number of key issues under PBS including whether there is an economic case for restricting Tier 2 (skilled workers) to shortage occupations only. The MAC produced a report in August and in September it was announced that the MAC’s recommendations would be accepted. The main changes for employers will be the following:
- all jobs must be advertised in JobCentre Plus for four weeks (instead of two)
- in the case of an intra-company transfers, the employee must have worked for the employer for at least 12 months (instead of six) before they can transfer to the UK
- the minimum salary to allow an individual to qualify as a skilled worker and be eligible to work in the UK will rise to £20,000 (instead of £17,000).
These changes will come into effect from next year and are largely a result of the political desire to protect British workers in the current economic climate. Employers should be aware of these added hurdles, both legal and political, when recruiting individuals from outside Europe.
Sponsors must also be alive to this constantly changing regime to ensure compliance with duties under Tier 2.
Audrey Elliott is a partner at Eversheds.