Employment Issues Post-Brexit

By Ben Mason, Employment Law Partner at Aaron & Partners

With just a few weeks of 2020 remaining, it is important that employers start to consider the impact of Brexit on the job market in the coming year. The transition period is due to end on 31 December 2020 and whilst the full implications of leaving the EU are not yet known, there will be changes to the right of freedom of movement for EU citizens who intend to live and work in the UK.

After the transition period comes to an end, there will be no immediate changes to UK Employment law and the EU-derived legislation will continue to apply, subject to the changes set out below in respect of EU workers. Of course, that legislation may be subject to change in the future.

The immediate impact of Brexit is likely to be most keenly felt by employers who recruit staff from within the EU. UK-based employers who are seeking to employ an EU citizen on or after 1 January 2021 will need to adhere to a new set of rules.

The Current Rules

Currently, all employers are required to check that any individual they are proposing to employ has the right to work in the UK. This existing requirement will apply until 30 June 2021 for EU citizens only and will overlap with the new rules until then. Thereafter, the process will become the same as for any other foreign national applying to work in the UK.

The New Rules 

From the 1 January 2021 employers will be required to register on an approved list to employ EU citizens. This will be in addition to their existing obligation to ascertain eligibility until 30 June 2021. Employers may apply for the type of licence they require, depending on the category of worker they intend to sponsor:

– Tier 2 Licence: entitles an employer to engage skilled workers with long-term job offers; and

– Tier 5 Licence: entitles an employer to engage skilled temporary workers.

Applications may be made through the gov.uk webpage, or by submitting a paper application. A fee is payable by the organisation at the application stage. Small businesses, employing fewer than 50 employees and with an annual turnover of £10.2million or less, and charitable organisations will pay a lower fee for each licence they require. A premium customer service scheme is also available for an annual fee of £8,000 for small businesses or £25,000 for large organisations.

Employers must also appoint specific roles within their organisation in applying for an appropriate licence and managing the sponsorship process. Those people will be responsible for managing the Sponsorship Management System (‘SMS’), and will act as the main point of contact for UK Visas and Immigration (UKVI).

Work Visas and class of worker

EU citizens will be required to apply for, and obtain, a work visa prior to travelling to the UK. To be granted a visa, a worker must attain 70 points which can be achieved through a number of various skills and abilities.

There will be three classes of worker which applicants will be assessed as:

1. Skilled Workers

Skilled workers will be required to evidence that they have an existing job offer from an employer who is on the approved list before applying for their visa. The salary for that role must exceed either the specified rate (Annex E, Table 27 of the UK’s Points Based Immigration System – Further Details July 2020 publication) for that particular job role, or £25,600, whichever is higher.

2. Highly Skilled Workers

Highly skilled workers (listed in the same document at paragraph 59) may enter the UK to seek work without an existing job offer, although the number of visas offered to highly skilled workers without a job offer will be capped.

3. Low Skilled Workers

Low-skilled workers may not be recruited at the National Minimum Wage; with the Government focussing on the points based system to encourage skilled individuals to enter the UK workforce. There is going to be some support, however, in traditionally low-skilled areas with schemes for seasonal workers and young people being increased to allow greater numbers of these workers into the UK.

We recommend that employers who rely on EU citizens to fulfil roles within their businesses submit an application to be included on the list of approved employers at an early stage. This is to avoid any ‘last minute’ rush to register at the end of 2020.