Act now to prevent skills gaps in the workforce post Brexit

Mini Setty, employment law specialist and partner at Langleys Solicitors, discusses why employers need to act quickly to be compliant with Brexit-related barriers to recruitment from the EU

Amid the ongoing efforts to control coronavirus and the massive economic impact that comes with it, recent news and government communications have served as a reminder of the consequences of Brexit, which are just around the corner.

Although many details of Britain’s departure from the EU are still being debated by Boris Johnson and his European counterparts, the effects of Brexit on the UK’s manufacturers are going to be felt very soon. From 1 January 2021, EU citizens will lose their freedom to live, work and study in the UK and become subject to immigration control. This means there is no longer a guarantee that an EU based recruit will be able to take up employment in the UK and employers potentially seeking skilled workers from overseas will have to move fast.

More than one in ten manufacturers in the UK are EU citizens, so it’s essential that businesses ensure they are ready for the imposing barriers to talent in order to avoid skill gaps in the workforce. This is especially true for the northern tech sector, which must work hard to attract people to live and work beyond London and the South East. Because of the upcoming law changes and the headlines currently surrounding it, many more businesses than usual will be submitting applications for sponsor licences, creating the potential for administrative backlogs.

So, how exactly does the new immigration system affect businesses? The UK government is introducing the points-based system from the start of 2021 and it applies to EU and non-EU citizens equally. This approach to immigration is designed to attract individuals who will contribute to the UK’s economy and will include a route for skilled workers who have a job offer from an approved sponsor licence holding employer.

To be eligible to seek employment in the UK, potential recruits will need to have a job offer at a required skill level loosely comparable to A Levels; will need to speak English; and will need to be taking employment that pays the threshold salary of £25,600 (or lower in certain circumstances). Skilled EU and non-EU workers will need to be granted a Tier 2 visa to enter the UK for work purposes. The number of skilled workers granted Tier 2 visas will be uncapped and the Government acknowledges that attracting the service of some highly skilled workers will be a vital building block for the UK’s economy. A route for a capped number of highly skilled workers is also being explored but will not be implemented until later.

Businesses that are considering hiring manufacturing talent from overseas and have not yet registered for a sponsor licence should do so now to make the recruitment process more straightforward come January. Similarly, firms with existing multinational workforces must consider the immigration status of their employees and the effects of the end of free movement from the EU before investigating sponsor licences and settled status applications accordingly.

To become a sponsor, businesses must undergo checks to ensure they are genuine, are solvent and that the roles they are recruiting for meet the requirements for salary and skills. Sponsors must also act and behave in a way which is beneficial to the wider public good. Senior personnel and key users of the sponsor licence service will have to undergo criminality and other security checks.

Costs associated with becoming a registered sponsor are a licence fee and an immigration health surcharge to cover the cost of an employee’s medical insurance during their time in the UK. From October, the health surcharge will cost £624.

In addition to the sponsorship route, the Government are introducing a quicker endorsement process for those working in science, technology, engineering and mathematics. A Global Talent immigration route will also be available to encourage highly skilled individuals with specialist skills and attract recognised leaders and the leaders of tomorrow to the UK. This route will focus on such people across science, humanities, engineering, the arts (including film, fashion design and architecture) and digital technology and aims to enrich the UK’s knowledge, economy and society.

Academic talent from overseas will be nurtured by special measures, including allowing international students who have graduated from a UK university to remain in the country and start a career.

The Home Office plans to open key routes from Autumn 2020, allowing international workers already in the UK to apply for ‘settled status’ ahead of the new immigration system taking effect. EU citizens who arrive in the country before 31 December 2020 can apply for settled status under the EU Settlement Scheme, providing the application is completed by June 2021. If the employee has not been granted settled status by June 2021, their employer will need a sponsor licence to continue their employment and their legal status in the UK.

The post-Brexit immigration system puts a lot at stake as manufacturing firms could potentially develop skill gaps in their workforce and it is essential organisations prepare now to minimise the damage. With such a reliance on EU-based workers, manufacturers must understand the points-based system, plan recruitment budgets, check whether they need a sponsor licence, and apply as soon as possible if they do.

Langleys has a dedicated employment team that can assist you and your business with issues related to Brexit and employment. For more information visit: www.langleys.com.