News -

- December 2010

UK government announces new cap on number of migrants to the UK

The government has announced that from April 2011 new measures are being introduced to limit the number of non-EEA migrants who may come to the UK.

Overview of UK immigration system

During 2008/9 the UK immigration system was changed to a points based system and split into 5 tiers.  (Each tier has been divided into sub-tiers).  These are as follows:

Tier 1 - Highly skilled migrants

Tier 2 - Skilled migrants workers

Tier 3 – Low skilled workers

Tier 4 - Students

Tier 5 – Temporary or exchange workers

With the exception of tier 1, migrants require to be sponsored by an employer prior to coming to the UK.  Sponsoring employers are subject to a number of reporting and record keeping formalities. The employer issues the migrant it wishes to sponsor with a Certificate of Sponsorship (“CoS”) and the migrant must then obtain entry clearance before arrival in the UK.

The new measures

The new measures include the following:

Tier 1 – Highly skilled migrants

  • The Tier 1 (General) route is to be closed.
  • Tier 1 (Entrepreneur) is be reformed.  This route will not be subject to a cap.
  • Tier 1 (Investor) is be reformed to offer an accelerated route to settlement.  This route will not be subject to a cap either.
  • A new category, Tier 1 (Exceptional Talent) will be created for migrants who have won international recognition in the scientific and cultural fields or who may achieve such recognition in the future.  This category is capped at 1,000 migrants.

Tier 2 – Skilled migrant workers

  • A maximum of 20,700 non-EEA workers who are coming to the UK under Tier 2 of the points based system will be permitted to enter the UK in the year 2011/2012.  Any migrant worker who will earn in excess of £150,000 per annum will be excluded from this cap.
  • All migrant workers must be at graduate level.
  • A pool CoS will be distributed to businesses monthly.  This is a change from the current system as under the interim cap the CoS were pre-allocated.  However, this means that applicants will have to compete against other applicants for their UK visas and in months when the limit is over subscribed, which is likely to be every month, the applicants with the greatest amount of points will qualify.
  • The Tier 2 intra-company transfer (“ICT”) migrants will be excluded from the cap, however, the criteria for qualifying for the ICT route is being tightened.  Any ICT migrant coming to the UK for more than 12 months must earn a minimum of £40,000 per annum and their stay in the UK is restricted to a maximum of 5 years.
  • The tier 2 (General) cap will be subject to an annual review.

Tier 3 – Low skilled workers

This tier has not been launched and there are currently no plans to launch it at present.

Tier 4 – Students

This is the tier used by overseas students to study in the UK.  Under the new tier system the UK educational institutions have to assume a greater compliance responsibility for their overseas students.

It has been announced that a consultation on Tier 4 will begin before the end of the year.

Tier 5 – Temporary or exchange workers

This tier will not primarily be used by employers but will instead be used by bodies who deal with temporary work.  For example, it may be used by charity workers who come to the UK to undertake voluntary work for up to 12 months.  It is comprised of the Temporary Workers and Youth Mobility Scheme sub-tiers.

Commentary

The abolition of Tier 1 (General) is unsatisfactory.  This route was used by employers who did not want to have to advertise vacancies under Tier 2 and/or were not licensed as sponsors.  Much comment from industry sources has appeared in the UK press expressing fears of an impending skills shortage as a result of these measures.

These amendments would appear to make our immigration system less responsive to employers’ needs just as the need to retain talent in the UK to assist the recovery from the recession becomes key for many.

For further information or to discuss the issues raised, please contact Colina Greenway (Turn on Javascript!) or Stephen Wright (Turn on Javascript!) on +44 20 3051 5711.

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