IMPACT – HIGH

What is the change? On Thursday, the Home Office announced that the first phase of Tier 2 changes following the Migration Advisory Committee’s recommendations will be implemented between now and April 2017.

What does the change mean? Companies should plan for higher salary thresholds for high-skilled foreign employees and assignees in the Tier 2 (General) and (Intra-Company Transfer) categories and should prepare for the closure of the Tier 2 (Skills Transfer) sub-category. The changes also include giving extra weight to overseas graduates within the Tier 2 (General) quota.

Below are the key changes and implementation dates relevant to business immigration.

Tier 2 (General):

  • Salary threshold for experienced workers will increase to £25,000 for workers sponsored on or after Nov. 24. (The threshold for new graduates will remain at £20,800).
  • Salary threshold will further increase to £30,000 beginning April 2017.
  • Tier 2 (General) workers who are sponsored before Nov. 24, 2016 may extend their stay and remain at the £25,000 threshold, but workers sponsored between Nov. 24, 2016 and April 2017 must meet the £30,000 threshold when renewing their stay.
  • The following exemptions from the salary thresholds will expire July 2019: nurses, medical radiographers, paramedics and secondary school teachers in mathematics, physics, chemistry, computer science, and Mandarin.
  • Nurses will remain on the Shortage Occupation List, but employers must go through a Resident Labour Market Test.
  • Tier 4 students may switch to Tier 2 only if they studied at a U.K.-recognized higher education institution.
  • Short-term ICT applicants must meet a new salary threshold of £30,000 for new applicants beginning Nov. 24, 2016. A transition period applies to Short-term ICTs already in the U.K.
  • The Skills Transfer ICT route will be closed to new applicants beginning Nov. 24, 2016.
  • Graduate Trainee ICT applicants will have a reduced salary threshold of £23,000 beginning Nov. 24, 2016, and sponsors may use up to 20 spots per year (up from the current maximum of five).
  • Beginning in April 2017, employers can rely on a milkround (university recruitment tour) that ended within four years before assigning a certificate of sponsorship but the worker must have been offered the job within six months of the end of the recruitment period.
  • An immigration health surcharge will apply to all ICTs but an implementation date has not been set.

BAL Analysis: The higher salary thresholds will increase labor costs for businesses. Companies should anticipate the additional salary increases in April of next year.

This alert has been provided by the BAL Global Practice group in the United Kingdom. For additional information, please contact uk@bal.com.

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