Of course, there is already an existing so-called ‘Australian-style Points-Based System’, previously heralded by Boris Johnson as the new face of UK immigration, which has been in place since 2008, and which was being phased out, and so this new system is perhaps not as new and radical as the government would like us to believe. However, it is fair to say this is a remodelling of the ‘work permit’ part the points-based immigration system, based largely on the existing Tier 2 Points-Based System (PBS), i.e. work visas requiring sponsorship from an employer with a sponsorship licence.
This new scheme is more flexible overall in terms of meeting the points requirements than the current system. Not only has the base salary requirement been lowered (but note, only from the existing higher ‘experienced’ rate of £30,000 and the lower existing ‘new entrant’ rate of £20,800 is effectively increased – more on this below) but also the skills requirement, as well as points being obtainable on a limited ‘trade-off’ or substitution basis, which seems to borrow from the old Tier 1 (General) category.
Immigration routes will also continue to exist outside this points-based system, for example, the new Global Talent route and the relatively new Innovator and Start-Up categories introduced in March, 2019, as well as Tier 1 (Investor), as far as we know. Some older pre-PBS routes will continue unaffected as well as, of course, partner and visitor routes.
Under this new work entry points-based system, a migrant must have a job offer and meet three conditions in applying for these work visas, which will give them 50 points towards the required 70 points:-
- A job offer from an employer with a sponsorship licence (employers who wish to employ migrant workers who don’t otherwise have a right to work must apply for a sponsor licence and this hasn’t changed). This will award 20 points.
- The job offer must be at the ‘required skill level’. This will award 20 points.
- Be able to speak English to a required level. (The required level is not yet disclosed but current Tier 2 General requirements are Level B1 CEFR, which is intermediate, and it might be reasonable to assume this will remain the same.) This will award 10 points.
The required additional 20 points need to be acquired from any of the so-called ‘characteristics’: salary level, job type (i.e. shortage occupation) and education level (i.e. PhD level). The Home Office will refine the system in due course and might add flexibility with further point scoring characteristics.
How does this new system compare to the existing Tier 2 system?
For the time being at least, there is no limit on the numbers that can apply. The Home Office will obviously review the numbers in due course to see how the system is performing and introduce a cap on numbers if it deems necessary.
From a visa process point of view, it is worth pointing out it seems there is no maintenance funds requirement – a certain level of funds held for a certain period to ostensibly cover initial living costs – which caused/causes a lot of applicants headaches because of the exacting specified requirements in terms of demonstrating these funds, although these funds could be ‘certified’ by an employer. This is a sensible shedding of a requirement that served no real purpose.
Fundamentally, the lowering of the required general salary level from £30,000 seems sensible given the work shortages we will presumably experience after Brexit and at first glance, looks generous. But as the announcement clearly states, “Migrants will still need to be paid the higher of the specific salary threshold for their occupation, known as the ‘going rate’, and the general salary threshold.” This refers to the Home Office job classifications which set out specific minimum salary rates in respect of job classifications to help ensure migrant workers are not exploited. It is not clear from the announcement how flexible these ‘going rate’ requirements will be or indeed whether they will be at all flexible.
So can these going rates be ‘traded off’ against other characteristics? For example, a certain job classification might require a minimum salary of £35,000 a year but can a migrant who would be paid £30,000 for this job compensate for the ‘going rate’ shortfall by means of other characteristics or attributes? Under the information published so far, these seems no scope for this. If so, would this lowering of the general salary threshold to £25,600 make any real difference to skilled, graduate level workers given most job classifications require more than this general salary threshold, certainly at experienced RQF Level 6 level? Perhaps we can expect a recalibrating of these going rates. It remains to be seen but the lowering of the required skill level of the job from RQF 6 to RQF 3, in combination with the lower general salary requirement, will certainly potentially allow vastly more access to migrant workers in general. One, however, fears whether such access will be effective for the regions given there will be no accounting for regional salary variations.
Important to note, and as mentioned above, is that under current Tier 2 General requirements there are two general salary thresholds: ‘new entrant’ and ‘experienced’. New entrants are currently subject to a general salary minimum of £20,800 so there seems to be an increase in salary requirements, all characteristics considered, for new entrants. New entrant means, in outline, an applicant under the age of 26 or one switching inside the UK from the Tier 4 student category into the work route. One wouldn’t expect this definition of new entrant to change. As to be expected, the new entrant going rate is considerably lower than the experienced going rate. In this regard, the announcement states, “We will set the requirements for new entrants 30% lower than the rate for experienced workers in any occupation and only use the base salary (and not the allowances or pension contributions) to determine whether the salary threshold is met.” Again, it is not entirely clear how or if these rates will be flexible (and allowances are generally counted towards the salary package under current Tier 2 General rules) but it seems, as presently conceived, there is no scope for these new entrant going rates to be ‘traded off’ against other characteristics. Indeed, with the overall salary requirement effectively raised for new entrants, it looks like, in concert, the salary requirements will be a rigid barrier to many.
Lowering of the skills threshold
The skills threshold for the jobs qualifying for these work visas will be lowered from Level 6 RQF, classed as graduate level, to Level 3 RQF which is classed as A level equivalent. This will allow migrants to apply for a huge variety of jobs, excluding those classed as lower or unskilled in respect of which the government has somewhat controversially made clear they are making no additional provision, except for a pilot scheme for seasonal workers which will increase the amount of these visas available from 2,500 to 10,000. This lowering of the skills requirement is encouraging but as above, the government has also stated there will be no regional variations in the salary thresholds so this perhaps doesn’t bode well for the regions where it might be difficult to meet the standard going rates.
Underpinning all of this, of course, is the need for an employer to have a sponsor licence in place before they can sponsor workers under this new system. The current Tier 2 process for applying for such sponsorship licences is hard work and having a licence and sponsoring workers is onerous, as well as expensive. The Home Office has promised to streamline the sponsorship system but one can be forgiven for being sceptical here. And will they make it cheaper? They’ve stated the Immigration Skills Charge will remain levied on the same basis on the employer and this is a significant cost at present: £364 a year for each worker for a small sponsor and £1000 a year per worker for a ‘large sponsor’. And this is on top of the Certificate of Sponsorship assignment fee, visa fees and Immigration Health Surcharge, the latter two of which are often borne by the migrant. It has become exponentially more expensive for working migrants to enter the UK over the last few years and we can only hope, if we are to meet skills shortages without unfairly impacting UK businesses, this might be made easier and perhaps more importantly, cheaper.
And for the migrant worker, how easy will it be to change employment?
Revival of Tier 1 (General)?
The government has also announced the creation of “a broader unsponsored route within the points-based system to run alongside the employer-led system.” This sound very much like the reintroduction of the much-missed Tier 1 (General) route which was closed to new applicants in 2011. In this route workers scored points according to attributes such as age, education and earnings – much like the new work permit system – but didn’t require sponsorship and were free to work for any employer or themselves. The government states this route is a work in progress but clearly, we can expect a modern, post-Brexit Tier 1 (General) with a cap on numbers.