Up to 900k UK businesses are running out of time to maintain their right to employ new EU workers from 1 January, writes Claire Taylor-Evans, Senior Associate in Employment and Corporate Immigration at law firm BoyesTurner.
The UK is now only 5 months away from leaving the EU Single Market and Customs Union.
As Priti Patel announced recently, the new Points Based Immigration system will be in place from January next year, essentially ending free movement. This means any employer employing EU citizens arriving in the UK from that date, will have to apply for a sponsorship licence or a “Skilled Worker Licence” as it will be known under the new regime.
As many as 900,000 businesses could be affected by the changes, which are likely to place a huge strain on Home Office resources and immigration officials. And unless businesses act quickly and prioritise their planning now they could face a battle to register in time for the right to employ workers from the EU from 2021.
Sectors likely to be hardest hit by the changes include food and drink manufacturing, leisure and hospitality, construction, retail, residential and social care and the UK’s rapidly growing tech sector.
Businesses will also have to budget for additional fees – £1,500 for the sponsorship application licence itself, as well as an immigration skills charge of up to £5,000 per worker. Businesses will also have to adjust to the highly regulated sponsorship regime, with detailed compliance rules for every EU citizen they employ post-Brexit.
Organisations should be proactive to ensure they protect their ability to recruit EU workers post-2021, and stay ahead of their competitors in the light of, in some sectors, an increasingly shrinking talent pool for some workers. They should:-
- Register as early as possible for a sponsor’s licence to beat the inevitable rush in the build up to the new system coming into effect;
- Protect any sponsorship licence they currently have by investing in compliance training to avoid losing their licence, and their employees having to leave the UK, and;
- For existing EU workers in the UK , companies should ensure their staff already know what they need to do to register under the EU settlement scheme and assist them in registering if necessary.
This will be a huge change for hundreds of thousands of businesses and it will create huge pressure on an immigration system which is already overwhelmed. As we get ever closer to 2021, that pressure will build further and there’s a very real risk that some firms will miss out on having their licence in place by the deadline and will be unable to recruit the talent they need.
The application system is quite complex. Applications will be rejected by Home Office officials if they do not meet the levels of information required, which could lead to more businesses facing issues and delays.
For larger businesses with expert HR teams, this will be challenging, but for smaller businesses who don’t have specialist teams, there’s a very real risk of them losing valuable time battling their way through official forms and having their applications rejected if they don’t get specialist advice to make sure they get it right first time. Time spent now on getting this right could pay dividends further down the line.