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IMPACT – MEDIUM
What is the change? The U.K. Supreme Court has upheld the immigration rule that imposes a minimum-income requirement for British citizens and permanent residents looking to sponsor their non-EEA dependents in the UK.
What does the change mean? The ruling does not affect visas for dependents of Tier 2 workers or other points-based system migrants, or any European nationals and their family members. While the minimum-income requirements will stay in place for British citizens and permanent residents, the Court has demanded greater evidential flexibility for the family to show alternative sources of funding, and a rewrite of the extremely prescriptive “specified evidence” guidance is now expected.
Background: The minimum-income threshold for spousal visas has been a requirement since 2012. The British citizen or permanent resident must demonstrate minimum income of £18,600 in order to sponsor their non-EEA spouse or partner to come to or remain in the U.K. The threshold increases to £22,400 if the family has a non-EEA child, and by £2,400 per child thereafter. Notably, the income of the non-EEA spouse or partner cannot be taken into consideration, which severely disadvantages families in which the British citizen or permanent resident does not work or is not the main breadwinner.
A group of families who were unable to meet the income requirement and therefore living in separate countries challenged the rule in the Supreme Court, arguing that it impeded their rights to family life. Evidence was given to show the current level of the minimum-income requirement prevents 41 percent of the U.K. working population from being a sponsor, and 55 percent of working women. The court upheld the principle of imposing a minimum-income requirement as a legitimate means to reduce net migration and ensure that family dependents are not a drain on public resources. However, the Court also recognized that the rule was especially harsh for families who have been separated from children because they are unable to meet the income threshold and asked guidance to be reconsidered on which assets can be relied upon to demonstrate family resources and how the rights of children can be better considered in overall decision making.
BAL Analysis: The ruling does not affect Tier 2 and other points-based system skilled workers and their dependents or the current European free movement regime for EEA nationals and their family members. Although the case does not directly address the impact on European nationals, the fact that the court has upheld the use of minimum-income requirements as a legitimate means to limit net migration to the U.K. overall suggests that such limits may apply in the future to EEA national spouses post-Brexit, albeit with much greater evidentiary flexibility.
This alert has been provided by the BAL Global Practice group in the United Kingdom. For additional information, please contact uk@bal.com.
What is the change? A draft regulation has been issued that details how the government will implement the new Immigration Skills Charge paid by companies hiring skilled foreign workers.
What does the change mean? Companies will be charged £1,000 per certificate of sponsorship per year of sponsorship per migrant (smaller companies with up to 50 employees and charitable organizations will be charged £364). The regulation sets out the full schedule for the Immigration Skills Charge and exemptions for certain skilled workers and certain occupational codes.
Background: The Immigration Skills Charge, first announced in March 2016, requires Tier 2 employers to pay additional monies to support a general government fund for skills training initiatives for British workers. Companies will be required to pay the charge each time they assign a Tier 2 certificate of sponsorship to a skilled worker via the Sponsor Management System.
The rate is £1,000 per year per worker for any company with more than 50 employees, payable up front at the certificate of sponsorship stage based on the length of employment entered on the CoS. There is a minimum of 12 months employment required, and calculated in six-month increments thereafter. For example, a six-month CoS would attract no charge, a 2 ½-year CoS will attract a £2,500 charge and a five-year CoS will attract a £5,000 charge. This charge is in addition to the CoS fee, visa application fee and immigration health surcharge linked to any Tier 2 migrants. It is also separate from the “apprenticeship fund” to be launched by the Department for Enterprise in April. Exemptions from the charge include:
There are no exemptions for employers who already invest in training schemes and resident worker employment initiatives, as the monies will be spent directly by the government, i.e., employers cannot apply to access these funds for their own sectors or initiatives.
Refunds of the skills charge will be given in the following instances where the Tier 2 worker never actually starts work:
The Home Office policy team has indicated they will consider allowing refunds in other circumstances – e.g., under current rules, if a five-year employee leaves employment there is no way to recover the charge—but these are not confirmed.
BAL Analysis: Employers should budget for the Immigration Skills Charge, which will take effect April 6 and must be paid up front for the full duration of each certificate of sponsorship.
BAL will be discussing the Immigraiton Skills Charge, along with other key Tier 2 changes and other immigration changes, in more detail at our webinar on March 23. Registration is available here.
Copyright © 2017 Berry Appleman & Leiden LLP. All rights reserved. Reprinting or digital redistribution to the public is permitted only with the express written permission of Berry Appleman & Leiden LLP. For inquiries please contact copyright@bal.com.
What is the change? A House of Lords select committee is seeking submissions on the impact that reduced migration from Europe post-Brexit would have on the U.K. labor market.
What does the change mean? Written submissions must be completed by Monday. The inquiry is aimed at examining how limiting migration from Europe would affect business and the U.K. economy—would it boost job opportunities for resident workers or will it deprive companies of access to a migrant labor force that is crucial to their success?
Background: The Economic Affairs Committee of the House of Lords is conducting its inquiry as the U.K. prepares to invoke Article 50 of the Lisbon Treaty to formally begin the process of leaving the European Union in March. Committee recommendations are expected to be made in early May and are likely to inform government policy on any immigration system post-Brexit. (BAL understands that all ideas are currently “on the table.”)
Besides seeking information on the overarching question of what the impact of Brexit on the labor market will be, the committee is inviting public feedback on (1) what level of migration is required for the U.K. labor market to function effectively; (2) the impact on wages in different economic sectors of restricting migration from the EU and further restricting migration from outside of the EU; (3) whether the government has adequate data on the immigrant worker population to make sound policy decisions; (4) whether the U.K. should consider regional variations to its immigration policies; (5) whether policies to control the level of migration from non-EU countries have been successful; and (6) what the U.K. can learn about immigration policy from other countries.
The committee has said that the inquiry is not focused on the status of EU nationals already living in the U.K.
BAL Analysis: Respondents do not have to answer every question and are asked to keep submissions short. Therefore the inquiry provides a good opportunity for companies to provide feedback on how a reduction in migration/restriction in employment rights for European nationals would affect the ability to access necessary skills from the market or to operate effectively as a U.K. employer. As EU migration routes are used to fill higher skilled positions in tech, financial services, pharma and other sectors, as well as low-skilled roles that arguably garner more political attention, multinational employers should make clear the impact of any reduction in overall access to visas.
What is the change? The Home Office has released a new guidance for sponsors highlighting several important changes to Tier 2 rules beginning April 6.
What does the change mean? Changes to the immigration rules are expected to be announced in March and to take effect April 6, including the new immigration skills charge of £1,000 per certificate of sponsorship.
The sponsor guidance now contains an addendum making clear that the immigration skills charge will come into effect April 6 as anticipated:
The sponsor guidance also now announces some other minor changes to the rules for Tier 2 migrants:
BAL Analysis: Employers should budget for the additional Immigration Skills Charge for all transfers and new hires now in the pipeline, as well as prepare for the other changes taking effect in April, which were highlighted last March when they were first announced. BAL will provide further news alerts as soon as the Statement of Changes to the Immigration Rules is available in mid-March and will be discussing the business impact of these changes in our upcoming client webinar.
IMPACT –MEDIUM
What is the change? Non-EEA family members may now file residency applications online and take advantage of the passport passback service.
What does the change mean? The online process is more convenient, and the passport passback service allows EEA nationals and their family members to retain the ability to use their passport and ID card while the residence card is awaiting processing in the U.K.
Background: The paper form and application process have been replaced by an online application process for a residence or permanent residence application for Europeans living in the U.K. seeking to document their status, with the following important process improvements:
BAL Analysis: These process improvements are a step in the right direction, although they do not improve overall processing times, which remain at six months. The passport passback service allows for greater ease of travel when applying for permanent residence based on five years of continuous residence and gives a greater incentive for companies to document their employees’ right to work under European law prior to Brexit in 2019.
This alert has been provided by the BAL Global Practice group in the United Kingdom. For additional information, please contact uk@bal.com. Copyright © 2017 Berry Appleman & Leiden LLP. All rights reserved. Reprinting or digital redistribution to the public is permitted only with the express written permission of Berry Appleman & Leiden LLP. For inquiries please contact copyright@bal.com.
What is the change? Parliament has voted against an amendment to the Brexit bill that would have guaranteed permanent residency to EU nationals currently living in the U.K. post-Brexit.
What does the change mean? The Brexit bill is currently being debated in Parliament and is expected to pass, giving Prime Minister Theresa May’s government the green light to trigger Article 50. The vote on the amendment means that the status of EU nationals in the U.K. remains an issue to be negotiated between the U.K. and the EU “as a priority” after Article 50 is invoked in March.
Background: The amendment to the Brexit bill would have ensured permanent residency rights for approximately 3 million EU nationals currently living in the U.K. Parliament rejected the proposed amendment by a vote of 332-290.
Home Secretary Amber Rudd issued a letter to reassure colleagues that the status of EU nationals would not be changed by the Great Repeal Bill, which seeks to transpose all EU law into U.K. law. The letter said that any changes to immigration rules for EEA nationals would be dealt with through a separate Immigration Bill to be debated in Parliament and promised that “nothing will change for any EU citizen without Parliament’s approval.”
May has consistently stated that she will not unilaterally guarantee the rights of EU nationals in the U.K. until U.K. nationals living within the EU receive reciprocal assurances.
BAL Analysis: The status of EU nationals in the U.K. post-Brexit remains uncertain with the rejection of the amendment. Rudd’s letter offers no legal guarantee to the 3 million EEA nationals in the U.K. and suggests only that Parliament will be able to vote on immigration law changes. Meanwhile, the Brexit bill is likely to pass, giving the government approval to trigger Article 50 of the Lisbon Treaty and begin formal exit procedures in March.
IMPACT – HIGH
Prime Minister Theresa May has published a white paper in which she sets out her government’s strategy for Brexit negotiations due to start March 31, including how the U.K. will deal with European nationals currently living and working in the country.
Key Points:
The U.K. will seek to negotiate a future relationship with Europe, outside the EU and the single market. The white paper says the U.K. will be guided by 12 broad principles, including:
Background: May outlined plans for a “hard Brexit” on Jan. 17, shortly before the Supreme Court judgment that the government must obtain Parliamentary approval before invoking Article 50. While MPs voted overwhelmingly in favor of getting Brexit negotiations started, the white paper was published reluctantly following MPs’ continuing demands to be allowed to scrutinize any Brexit deal.
BAL Analysis: The white paper adds little to the statements May made on Jan. 17. EU nationals and their U.K. employers must continue to wait for real details to emerge once the Article 50 talks start in March. While the message that EU nationals in U.K. with five years continuous and lawful residence are automatically considered permanent residents may reassure some, questions still exist around how government officials are interpreting “lawful” in practice. The devolved governments in Northern Ireland, Scotland and Wales will likely continue to lobby for greater access to the single market. BAL will continue to follow Brexit-related immigration developments and will provide regular updates to clients going forward, and understands that at this point all options for future immigration systems for EEA nationals are still on the table.
UNITED KINGDOM (Jan. 24, 2017) – Brexit procedures cannot begin without Parliament vote, Supreme Court rules
The Supreme Court has ruled that Prime Minister Theresa May must obtain the approval of Parliament before invoking Article 50 of the Lisbon Treaty and beginning the process of leaving the European Union.
The ruling, announced Tuesday morning, was expected after a High Court reached the same conclusion in November. It is not expected to delay May’s timeline of invoking Article 50 by the end of March.
Background: The case was brought by U.K. citizens and other interested parties, including some EU nationals living in the U.K., who argued that it was unconstitutional for the government to begin withdrawal from the EU without Parliamentary assent. A High Court agreed with this position in November, rejecting the government’s argument that it could use the royal prerogative to invoke Article 50 without the go-ahead from Parliament.
The Supreme Court upheld the ruling by an 8-3 margin.
May outlined plans for a “hard Brexit,” including the U.K.’s departure from the single market, last week. May also said that she would like to guarantee the rights of EU nationals in the U.K. at an early stage in the negotiations, but will only do so if there is a reciprocal deal for U.K. nationals in the EU. Tuesday’s ruling could give some leverage to a cross-party group of MPs to protect the rights of EEA nationals in the U.K. during negotiations, but there is no guarantee at this point.
BAL Analysis: While the decision is a setback for the government, it does not appear that it will significantly change the timing of when the U.K. will invoke Article 50. The ruling does provide grounds for greater parliamentary involvement in Brexit negotiations generally, however. BAL will continue to follow Brexit-related immigration developments and will provide regular updates to clients going forward.
What is the change? The United Kingdom has said that it will allow Indian nationals applying for standard visitor visas in India to postdate their visas by up to three months as part of a campaign to encourage people to apply for visas during the low-volume months of January and February.
What does the change mean? Effective immediately, Indian nationals applying for visit visas in India will be able to obtain postdated visas by providing their intended dates of travel during the application process. Visas will be dated one day before their planned date of departure. U.K. officials also stress that applicants are likely to experience quicker turnaround times now than they would during higher volume parts of the year.
Background: The U.K. announced its “Beat the Peak” campaign earlier this month at the Destination Britain India event in Pune. The British high commissioner to India, Dominic Asquith, said in a statement that by making it easier for visitors to apply for visas early, the U.K. hoped that “even more Indians will choose to come to visit the UK to see our world class heritage sites, enjoy our beautiful countryside and experience the vibrancy of our cities.” Additional information is available on the UK’s VFS Global India website.
BAL Analysis: The option of postdating visas broadens the appeal of applying for visas in January and February and could save applicants significant time in the application process.
This alert has been provided by the BAL Global Practice group in Singapore. For additional information, please contact singapore@bal.com.
The following is a roundup of recent developments concerning Brexit negotiations and the United Kingdom’s withdrawal from the European Union.
News Summary
The Supreme Court has ruled that Prime Minister Theresa May must obtain the approval of Parliament before invoking Article 50 of the Lisbon Treaty to begin Brexit negotiations. The ruling was expected after a High Court reached the same determination in November.
Despite this news, the U.K. appears headed for a “hard Brexit” that would overhaul the country’s immigration programs. The Supreme Court’s ruling is unlikely to delay May’s timeline of invoking Article 50 by the end of March, and may even bring it forward. Last week, May detailed plans for a hard Brexit, saying the U.K. would leave Europe’s single market in order to regain control over migration from Europe. May stressed that while the U.K. would like to guarantee the rights of EEA nationals in the U.K., it will only do so if there is a reciprocal deal for U.K. nationals in the EU.
Legal
The Supreme Court case was brought by U.K. citizens and other interested parties, including some EU nationals living in the U.K., who argued that it would be unconstitutional for the government to begin withdrawal from the EU without Parliamentary assent. The Supreme Court agreed with this position, rejecting the government’s argument that it could use the royal prerogative to invoke Article 50 without the go-ahead from Parliament.
While the ruling gives Parliament the power to delay triggering Article 50, this action seems unlikely given that conservatives have a working majority in the House of Commons. Brexit minister David Davis said Tuesday that legislation to invoke Article 50 would be introduced “within days.”
“The purpose of this bill is simply to give the government the power to invoke Article 50 and begin the process of leaving the European Union,” he said.
In the wake of the decision, the Labour Party’s Brexit spokesman Sir Keir Starmer continued to push for the government to produce a white paper or other written document outlining the U.K.’s plan for Brexit negotiations with the EU. “A speech is not a white paper or plan,” he said. “And we need something to hold the government to account throughout the process. You can’t have a speech as the only basis of accountability for two years or more.”
The Supreme Court ruling could provide some leverage to a cross-party group of MPs to protect the rights of EEA nationals in the U.K. during negotiations; however, there is no guarantee at this point, and the rights of EEA nationals could emerge as a “bargaining chip” during the U.K.’s negotiations with the EU.
Politics
May’s speech on Jan. 17 confirmed plans for a hard Brexit. “We do not seek to hold on to bits of membership as we leave,” she said. “The United Kingdom is leaving the European Union and my job is to get the right deal for Britain as we do.”
May said the U.K. will leave Europe’s single market and negotiate an entirely new free-trade deal with the EU. This would involve seeking access to the European market without being part of it, thus avoiding associated costs and responsibilities.
May also said the U.K. would make it a priority to protect the Common Travel Area with Ireland, and that the devolved administrations in Scotland, Wales and Northern Ireland would be involved in negotiations.
However, the Supreme Court ruled that the devolved governments do not need to be consulted before Article 50 is invoked, prompting calls from First Minster for Scotland Nicola Sturgeon for a second Scottish independence referendum to allow Scotland a chance to negotiate its place in Europe.
Immigration
Future Migration
Little detail has emerged to answer the key corporate immigration question: What will happen to the 3 million EU/EEA nationals currently residing and working in the U.K., or to the 1.2 million U.K. nationals currently working and residing in the EU? May’s remarks offered little assurance.
“We want to guarantee the rights of EU citizens who are already living in Britain, and the rights of British nationals in other member states, as early as we can,” May said. “I have told other EU leaders that we could give people the certainty they want straight away, and reach such a deal now.”
In practical terms, this means that EEA nationals’ status in the U.K. is largely dependent on the postures of other European governments toward the U.K. As noted, EEA nationals in the U.K. have emerged as a potential “bargaining chip” in upcoming negotiations. Their status, for now, is not guaranteed, and the stricter approach to recent permanent residence applications suggests that up to 1 million EEA nationals in the U.K. could find themselves unprotected when Brexit occurs.
And while May did say she wants the U.K. to be a “friend and neighbour” to the EU, she also said that with respect to Brexit negotiations, “No deal for Britain is better than a bad deal for Britain.” This signals that a hard line will be taken during negotiations.
When planning future migration to the U.K., companies should assume that the principle of free movement and the European legal mechanisms to support it will cease to exist after Brexit. BAL anticipates that future migration from the EU will likely be absorbed into the U.K.’s overall immigration program.
Parliamentary Report Makes Case To Protect The 3 Million
The Lords Select EU Justice Committee previously published an advisory report detailing the “acquired rights” of EU citizens in the U.K. post-Brexit. The report indicates that when the U.K. leaves the EU, any rights of residence in the U.K. stemming from EU law will cease to be enforceable. Recognizing the justified anxiety felt by EU citizens over whether their lives in the U.K. can continue post-Brexit, the report recommends that May make a unilateral commitment to safeguard these rights prior to triggering Article 50 as “morally right,” or at the very least put the rights of EU nationals on the agenda as a preliminary and separate item immediately after Article 50 is triggered.
Comprehensive Sickness Insurance Technicality
The report also highlights the issue of the estimated 1 million EU nationals in the U.K. who are unable to meet the criteria for permanent residence as it currently stands, even though they have lived in the U.K. for the requisite five years and frequently far longer. Apart from the practical bureaucratic barrier of an 85-page application form that is difficult for non-lawyers to negotiate, the technical issue barring qualification for permanent residence frequently revolves around the Home Office’s strict interpretation of the requirement for comprehensive sickness insurance.
Scotland and Northern Ireland
Significant for the oil and gas industry in Scotland and corporations operational in Northern Ireland is the fact that the devolved governments in the U.K. do not need to be consulted over the Article 50 process, which was a unanimous decision by the Supreme Court. Therefore, separate deals or concessions cannot be brokered for those regions.
Preparing for Brexit
Even with Tuesday’s ruling, BAL anticipates that Brexit negotiations will begin soon, setting the U.K. up for a departure from the EU in 2019. Now is the time to begin preparing your business as much as possible for a more restrictive immigration scheme for both existing and future EEA employees.
Employers
BAL can assist your company with a number of services including:
Employees
Employees can also take steps to prepare for Brexit, including making sure they are aware of their legal status in the U.K. and whether there is a basis on which they can claim to be a “qualified person” under EU law. Employees should make sure they possess:
Critical Dates
BAL urges companies and employees alike to take an informed and thoughtful approach to Brexit. While the hardline approach is not encouraging, the status of EEA nationals in the U.K. has not changed and will not change for some time. Below is a timeline of key dates:
Should you have any questions or require more information on how BAL can help with Brexit strategic planning, please contact us at uk@bal.com.
The Brexit Bulletin has been provided by the BAL Global Practice group in the United Kingdom. For additional information, please contact uk@bal.com.