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IMPACT – HIGH
The U.K. government has now confirmed that in the event of a “no deal” Brexit:
In the alternative, in the event that the Withdrawal Agreement (“the deal”) is ratified:
It is important to note that in any scenario, Irish nationals will continue to have the right to enter and live in the U.K. under the Common Travel Area arrangements which pre-date the European Union, and will not need to apply under either the EU Settlement Scheme or for European Temporary Leave to Remain. Moreover, the rules for EU nationals will be applied equally to nationals of EEA countries (Norway, Iceland and Liechtenstein) and to Switzerland.
Analysis & Comments: Employers have known for weeks that, whether or not there is a deal, the EU Settlement Scheme will protect EEA nationals living in the U.K. prior to March 30, 2019. However, the position for new assignees arriving in the U.K. post-Brexit has been unclear until now. Employers are only now in a position to conduct thorough no-deal planning that takes into account the position for both current and future employees from the EU, EEA and Switzerland. This latest announcement confirms that new migrants, while allowed entry to the U.K. on the same terms and at no cost, will have to obtain a temporary visa with a fee in order to stay beyond three months. If they are staying more than three years, they would then need to follow with an application under the U.K.’s new single immigration system once it is launched. Employers must therefore factor in increased costs and process requirements for EU, EEA and Swiss nationals in the short term should “no deal” prevail, and amend recruitment strategies accordingly.
In the event of no deal, employers will for the first time have two sets of Europeans in their workforce: those with residency rights (which may or may not be registered under EU Settlement Scheme) and those with temporary permission to live and work in the U.K., the ETLR permit holders. However, the fact that right-to-work checks will continue to be based on passports, ID cards, and biometric residence cards alone means that employers should not have to adapt right-to-work checks at short notice.
Source: Deloitte LLP. Deloitte LLP is a limited liability partnership registered in England and Wales with registered number OC303675 and its registered office at 1 New Street Square, London EC4A 3HQ, United Kingdom.
What is the change? The U.K. government has announced plans to scrap all fees for EU nationals and their family members applying to register their residence in the U.K. under the EU Settlement Scheme. Registration under the scheme will now be free.
Key points:
As a reminder, under the EU Settlement Scheme:
Analysis & Comments: Today’s announcement that the government will scrap fees for registration under the EU Settlement Scheme—£65 for adults and £32.50 for children—should be welcomed by employers and employees. Employers looking to support employees with EU Settlement Scheme applications should be ready for further questions about the scheme, especially regarding payments and refunds, and to amend any Brexit communications in light of this change once it is formally incorporated into the immigration rules.
IMPACT – MEDIUM
What is the news? Starting Monday, the United Kingdom’s EU Settlement Scheme will open to the public for an expanded test phase for EU nationals in the U.K. to secure their residency rights.
Background: The U.K.’s EU Settlement Scheme was put into the U.K. immigration rules in August 2018, and has since been undergoing trials, initially with select universities and National Health Service trusts in northwest England, and then more widely in the NHS, with a full launch not expected until March 30. To date, 15,500 applications have been made, with 12,400 registrations completed, suggesting that the scheme is effective in delivering its aims (although a full report later this month should provide more details).
Analysis & Comments: This announcement means that the EU Settlement Scheme will be available to EU nationals in the U.K. sooner than many employers and employees expected. While registrations are voluntary, this announcement may encourage a surge of applications. In light of this updated timetable, employers looking to support employees with applications should be prepared to address further questions about the scheme in their Brexit communications and events for their employees.
What is the change? The immigration health surcharge required of non-EEA nationals is set to double from £200 to £400 per year (£150 to £300 per year for students and Youth Mobility Scheme applicants).
What does the change mean? Employers, non-EEA nationals and their family members intending to stay in the U.K. for longer than six months should budget for the sharp increase. The surcharge must be paid up front and in full for each individual and for the full term of the visa at the time of application.
Background: The immigration health surcharge, which was introduced in April 2015, requires non-EEA nationals to contribute to their use of the National Health Service while in the U.K. The surcharge was expanded to include Australia and New Zealand in April 2016 and to the Tier 2 (Intra-Company Transfers) subcategory in April 2017.
A government review found that doubling the surcharge could generate an additional £220 million per year for the NHS, and in early 2018 the government announced plans to implement the increase by the end of the year.
Analysis & Comments: The immigration health surcharge is a significant upfront cost for companies recruiting non-EEA workers and its doubling will be felt by business. Companies should budget for the additional costs associated with hiring and retaining foreign workers.
The United Kingdom has reached agreements on Brexit and citizens’ rights with Iceland, Liechtenstein and Norway (the ‘EEA EFTA states’), and, separately, with Switzerland.
The four countries are all part of Europe’s single market, but are not full members of the European Union and are therefore not covered by the EU Withdrawal Agreement and the U.K.’s EU Settlement Scheme. The U.K. now has three agreements on the table – the primary withdrawal agreement with the EU (which is awaiting a critical vote the week of Jan. 14), one with the EEA EFTA states, and one with Switzerland. The agreements largely offer the same levels of security on citizens’ rights.
Key Points:
Analysis & Comments: The agreements are welcome news for some 50,000 U.K. citizens living and working in Iceland, Norway, Liechtenstein and Switzerland, and roughly 30,000 EEA-EFTA and Swiss citizens in the U.K., as well as their employers. More will be known in the coming weeks about the consequences of “no deal” on the future of mobility between the U.K. and these countries.
The U.K. Government published its 164-page white paper Wednesday on the proposed future immigration system, which would replace the current points-based system with a skills-based system. The provisions below would be effective starting January 2021 with further operational details intended to be announced in early 2020.
The headline principles
The details
A skilled-workers route
The skilled-worker route would be a sponsored route but the intention is to make this route simpler and easier to use. As a result of these changes, processing times are intended to be shorter and the system would aim to reduce the burden on employers. The end-to-end processing time for the skilled-worker route would be two to three weeks compared with current Tier 2 processing times of three to six months.
The skills charge and National Health Service charge would continue to apply.
A temporary short-term workers route
Youth Mobility Scheme (YMS)
Students
Visitors – “a secure and smooth border”
Access to the UK benefits system
In line with the suggested changes to the immigration system, the white paper specifies that the Government is proposing that in the future individuals who are subject to immigration control would not routinely be able to access the U.K. benefits system. In practice they are suggesting that individuals moving to the U.K. from the EU would need to make significant contributions to the U.K. economy before they would be able to access certain state benefits. The expectation is that full access to the U.K. benefits system would only be available after settled status is granted, which is usually after five years. This would be a significant change from the current position of rapid access and would look to align the rights of EU migrants to access U.K. state benefits with those of non-EU nationals.
What if there is no deal?
The Government is intending to clarify its position on EU nationals entering the U.K.after March 29, 2019 if there is no Brexit deal, which is expected to be released shortly. Regardless, the Settled Status scheme which is anticipated to go live in early 2019 would apply.
Analysis & Comments: We welcome the proposed pro-business immigration system outlined in the white paper, which has taken into consideration the needs of U.K. and international businesses. The white paper looks to make clear that the U.K. remains open for business, aiming to attract the brightest and the best talent, while allowing for temporary low-skilled workers and youth-mobility workers to contribute to the U.K. economy. In our view, this white paper is a very positive first step toward the U.K.’s new immigration system starting in 2021.
What is the change? The Home Office has published a Statement of Changes to the Immigration Rules across most categories in the points-based system and announced plans to implement a new seasonal worker scheme pilot. The Home Office has also announced its intention to further reform the Tier 1 categories for non-employer-sponsored, high-skilled business migration to the U.K. in the spring.
Key changes: The following changes to the Immigration Rules are due to take effect Jan. 1:
While full details are not yet available, the Home Office has also announced that the following changes can be expected shortly and to take effect by spring:
Analysis & Comments: The current changes for Tier 2 skilled workers requiring work permits and other points-based categories are mostly technical and minor. However, planned reforms to the Tier 1 categories are part of the Home Office’s significant reconsideration of all non-employer-sponsored, high-skilled migration routes, and build on the introduction of a new Tier 1 (start-up) visa route announced in June. In addition, the implementation of the seasonal worker scheme pilot for selected agricultural employers is a significant step toward testing the effectiveness of proposed U.K. immigration reforms at alleviating seasonal labor shortages.
High Priority
What is the immigration news? In response to widespread media reports last week that the Home Office has suspended Tier 1 Investor visas, the agency issued a new press statement via email Tuesday that “The Tier 1 (Investor) visa is not currently suspended, however we remain committed to reforming the route. A further announcement will be made in due course.”
Foreign nationals intending to apply under this route should be able to continue to lodge applications under current rules.
Additional information: Last Thursday, multiple news organizations including the BBC, the Guardian and the London Times reported on the basis of a press statement from the Home Office that the Tier 1 (Investor) visa category would be suspended with immediate effect owing to concerns about abuse and money laundering in the program. Minister of State for Immigration Caroline Nokes issued a written statement to parliament the same day indicating the Home Office’s intent to introduce reforms to the Tier 1 (Investor) program in spring 2019.
The Tier 1 (Investor) category provides visas and a path to permanent residency to foreign nationals who demonstrate a minimum investment of £2 million. Currently, applicants may meet the investment thresholds through holdings in a regulated financial institution in the U.K. or overseas for 90 days before the application, or if the funds were already invested in the U.K., through holdings in U.K. government bonds, share capital or loan capital in active and trading companies registered in the U.K.
BAL Analysis: Foreign nationals seeking to apply under the Tier 1 (Investor) route should be aware that changes are forthcoming and are likely to tighten the eligibility criteria, which could include removing holdings in U.K. government bonds as a qualifying investment and the possibility of applicants needing to demonstrate that their business investments have been audited.
This alert has been provided by the BAL Global Practice group. For additional information, please contact berryapplemanleiden@bal.com.
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What is the news? The U.K. government has issued a policy paper confirming the treatment of EU and EEA nationals in the U.K., and U.K. nationals in the EU/EEA, in the event of a “no deal” Brexit.
What does this mean? The negotiated Brexit Withdrawal Agreement provides important protections for EU nationals in the U.K., and U.K. nationals in the EU. It gives all EU nationals already in the U.K. a route to stay permanently via the EU Settlement Scheme and creates an implementation window until Dec. 31, 2020 in which free movement would continue. This agreement has been approved by the U.K. cabinet and by the EU at a recent summit, but must still pass through the U.K. Parliament.
The U.K. government has clarified citizens’ rights and what will change if the Withdrawal Agreement is not passed. EU nationals and family members living in the U.K. before March 29, 2019:
Notably, the policy paper does not deal with EU nationals entering the U.K. after March 29, 2019 but before the new immigration system is implemented on Jan. 1, 2021.
The policy paper also sets out that:
U.K. nationals in the EU:
Analysis & Comments: This policy statement confirms that there will be crucial differences for citizens’ rights in a “no deal” scenario. It should reassure the many EU nationals in the U.K. and their employers that they have a right to stay, and can continue to plan for the EU Settlement Scheme rollout in early 2019 (albeit with a reduced deadline to make their applications by Dec. 31, 2020). The greatest uncertainty is for new arrivals from the EU after Brexit on March 29, 2019, since very little detail has been disclosed as to how they will be treated in a “no deal” scenario.
What is the change? Effective immediately, the U.K. government has suspended the Tier 1 (Investor) Visa category for new applications due to concerns about corruption. The visa allows foreign nationals to apply for visas and is a path to permanent residency in the U.K. if they are able to meet investment thresholds and criteria. The route will remain open for extension applications.
What does the change mean? The visas will be suspended until 2019, when stricter rules will be introduced to prevent fraud, including audits of applicants’ business investments and evidence that they have controlled a minimum of £2 million in funds for at least two years. Additionally, their investment under the Tier 1 Visa must be in an active U.K. company; investment in government bonds will no longer be considered.
Background: The Tier 1 (Investor) program was introduced in 2008. In 2014, following a Migration Advisory Committee report which found that the route provided little economic benefit to the U.K. labor force, the investment minimum was doubled from £1 million to £2 million. Until now, applicants could meet the investment thresholds through holdings in a regulated financial institution in the U.K. or overseas for 90 days before the application, or if the funds were already invested in the UK, through holdings in U.K. government bonds or share capital or loan capital in active and trading companies registered in the U.K.
Analysis & Comments: Foreign nationals will not be able to apply under the Tier 1 (Investor) Visa route until further notice from the Home Office. Applicants intending to apply when the program reopens should anticipate greater scrutiny, stricter investment criteria, and an audit of their businesses and investments.