The United Kingdom exited the European Union on 31 January 2020. As a result, from 1 January 2021, EU and non-EU citizens will be treated equally and free movement will be replaced by a points-based immigration system.
This new immigration system will be the biggest structural change to the UK labour market in decades.
Under the new approach, the UK will be open to highly skilled workers from anywhere in the world, but the door to those with low skills will be closed in order to create a “high wage, high-skill, high productivity economy”.
What is a points-based immigration system?
A points-based immigration system is an immigration system where a noncitizen’s eligibility to immigrate is determined by whether that noncitizen is able to score above a threshold number of points in a scoring system that might include such factors as education level, wealth, connection with the country, language fluency, existing job offer, or others.
The aim of this system is to prioritize the skills a person has to offer, not where they come from.
How does the points-based immigration system work?
In a policy statement being published on 19 February, the government said that to get a visa, applicants from anywhere in the world will need to secure 70 points.
The table below shows how this would work:
In simpler words, to get a work visa, skilled workers will require a job offer (20 points), be applying for a skilled job (20 points), be able to speak English (10 points) and – in most cases – be enjoying a salary of £25,600 or above (20 points).
Nevertheless, the Home Office has stated that the system will need to be refined and further flexibility will be added by including additional attributes that can be “traded” against a lower salary.
Low skilled workers
There will not be a general low-skilled or temporary work route. In the government words, “we need to shift the focus of our economy away from a reliance on cheap labour from Europe and instead concentrate on investment in technology and automation”.
However, employers haven’t welcomed this initiative as how some sectors such as care, hospitality and transport will be able to replace low skilled workers with technology remains to be seen.
Moreover, employers fear this could discourage recruitment for jobs that Britons seem to want to avoid, and at a time when many economists say the country is effectively at full employment, which could result in labour shortages and higher prices for consumers.
In addition to the recently introduced Global Talent visa (which is not a points-based category) the government proposes to introduce a broader unsponsored route to run alongside the employer-led system.
This will allow a smaller number of the most highly skilled workers to come to the UK without a job offer.
Example characteristics for which points could be awarded include academic qualifications, age and relevant work experience.
How will this initiative affect employers?
UK businesses will need to adapt and adjust to the end of free movement.
The government has declared that “it is important that employers move away from a reliance on the UK’s immigration system as an alternative to investment in staff retention, productivity and wider investment in technology and automation.”
But for the time being, the Settlement Scheme for EU citizens, which opened in March 2019, has already received 3.2 million applications from EU citizens who will be able to stay and work in the UK which, according to the government, will provide employers with flexibility to meet labour market demands.
Further detail on the new points-based system, including detailed guidance regarding the points tables, shortage occupations and qualifications will be published in the coming weeks so we will keep you updated.
If you’d like further advice about Brexit implications for business, you can speak to one of our legal team by booking a free, no strings attached call with one of our legal specialists here.