What do the new immigration laws mean for the recruitment industry post Brexit?

The world of work has been in a state of upheaval for several years, with recruiters facing some of the biggest upheavals in a generation.

What do the new immigration laws mean for the recruitment industry post Brexit?

The world of work has been in a state of upheaval for several years, with recruiters facing some of the biggest upheavals in a generation.  First, there was the uncertainty of Brexit to deal with. Deal or No Deal? Hire or fire? Then, like a terrible bolt from the blue, Covid-19 hit, forcing the biggest disruptions society has seen for generations. And unfortunately, the repercussions and implications look set to continue for months, if not years.

In the all-consuming pandemic panic, and the financial aftermath that looks set to lead to a spike in unemployment, attention has understandably drifted from the first problem. Brexit and the issues it created seem like another world away. However, come hell or high water, the British government is committed to leaving the EU on December 31 this year. The date looms like an iceberg in the fog. For recruiters, it adds a new layer of complexity and potential problems on top of the sizeable personnel havoc that the coronavirus is already creating. 

What we know so far

From 1 January 2021, EU free movement is set to end, and a new points-based immigration system will take effect in the UK. EU workers currently in the UK who wish to stay here must apply for permission under the EU Settlement Scheme. At the start of July, 3.71 million applications had been made under the scheme and 3.46 million had been successful. There will be no more automatic rights to work in Britain for EU citizens after January 1, 2021. They will be treated the same as anyone from anywhere else in the world.

The transition period between the decision to leave the EU and the date of leaving technically allowed employers who recruit and rely on migrant labour to prepare for the post-Brexit landscape.  In reality however, preparing has been hard because the details of how the post-Brexit immigration system will work have only been drip fed by the Government, which has had to draft and pass new laws in the form of the Immigration Bill, which supersedes free movement. This was only published recently and has yet to be enacted into law. Then, 2020 was hijacked by the Covid-19 crisis, draining attention and resources. As a result, immigration changes are in danger of creeping up on businesses and catching them out.

How will coronavirus affect recruiters?

The complexity of the situation is amplified by the changing economic landscape, in which unemployment is forecast to rise considerably. The rise will not be uniform. Businesses in certain sectors will suffer more than others. For example, hospitality, High Street non-food retail and tourism have been hit hard by the pandemic, while IT, food retail and home sports equipment have benefited. Generally, the sectors that have suffered the most employ lower-skilled workers and as failing companies in these sectors shed workers, recruiters will find more unskilled and casual workers looking for jobs. There are of course exceptions to the rule. One pub which recently advertised for bar staff reported being overrun with 400 applicants for two jobs. The candidates included managerial level hopefuls from retail stores and airlines. Given the numbers of redundancies, recruiters generally have the pick of the bunch and this growing pool of available labour (ie unemployed people) will grow after the Government withdraws the furlough scheme in October. It is feared by some commentators that mass unemployment is currently being staved off because a huge percentage of the national workforce is on the Government’s books.   

There is an argument to say that the non-skilled labour shortages some feared the end of free movement will create ‘ particularly in sectors such as care ‘ will be filled by people made jobless in the pandemic.

In the meantime, there are still shortage professions such as skilled IT and engineering that unemployed shop workers and waiting staff will be unable to fill. They may well retrain, but reskilling takes time. It is recruiters working in these shortage professions who have relied on free movement to provide personnel where appropriately experienced and qualified native workers have been scare, who are most at risk of being caught out by the end of free movement.

With time running out to prepare, what do the changes mean for businesses who currently employ EU citizens, and what practical steps should HR and business owners be taking now to support their EU workers and avoid future workforce and recruitment issues?

Foreign workers coming to the UK after 1 January 2021

EU citizens not already resident in the UK will be subject to the same immigration rules that currently apply to non-EEA nationals after the deadline. They will have to apply to the Home Office for the appropriate visa, prove eligibility and pay any relevant fees.

EU workers currently in the UK who wish to stay and have not already applied for permission under the EU Settlement Scheme must do so.

Employers planning to recruit any overseas workers who are not currently a Home Office approved migrant worker sponsor must gain authorisation first. There is time, effort and expense involved in the process, with no guarantees of a successful outcome. 

In order to get a sponsor licence, businesses must demonstrate they have:

  • The necessary systems in place to comply with Sponsor Licence duties and responsibilities
  • No past convictions or breaches in immigration or any other area of law
  • No history of breaches of UK Visas and Immigration’s (UKVI) sponsorship duties

Applicants can expect a visit from a UK Visa and Immigration (UKVI) officer to check there is a genuine need for a licence and to ensure correct systems are in place to manage sponsored workers. The officer also checks that the application details are accurate.

If successful, businesses are then obliged to maintain an ongoing compliance system which involves:

  • Updating the Sponsorship Management System (SMS). This is an online system provided by UKVI
  • Keeping records of checks undertaken. These include verifying foreign workers have the necessary skills, qualifications, and professional accreditations
  • Conducting a Resident Labour Market Test (RLMT) to ensure no settled worker can fulfil the role
  • Ongoing monitoring of sponsored employees, including attendance and changes in contact details
  • Advising UKVI of any non-compliance by sponsored workers

Sponsor licence holders are also required to appoint individuals to key roles. They need an authorising officer, a key contact and someone to undertake day-to-day management of the SMS.

It is these measure that recruiters will have to have in place before January 1, 2021 if they wish to employ any workers from outside the UK, they from Europe or the rest of the world.

The process can seem daunting for those who have never been through it, however, there are consultants and legal experts who can guide employers through what can be a minefield. The benefits for employers are considerable, as they allow businesses to recruit from a global pool of talent.

Your 2021 checklist

Plan your recruitment needs for 2021. Will you need to hire from overseas?

Do you have a sponsor licence? If not, you need to apply now.

If you have a sponsor licence, check its validity.

Do you currently employ any EU workers? Check their settlement status. If they intend to remain in the UK after January 1, 2021 they will need permission.

Yash Dubal
Yash Dubal

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