Tier 2 Visas
The Tier 2 visa category is applicable for employers who wish to sponsor a skilled migrant worker. The Tier 2 category is sub-divided into four subcategoriess, in which the relevant categories are the ‘Tier 2 (General)’, and ‘Tier 2 (Intra-Company Transfer)’. The Tier 2 (Intra-Company Transfer) is further sub-divided into three categories: ‘Long Term Staff’, ‘Graduate Trainee’ and ‘Skills Transfer’.
The Tier 2 (Intra-Company Transfer) category are for migrant workers who have been offered a role in a UK branch of the organisation, and the Tier 2 (General) category are for skilled migrant workers who have a job offer by a UK employer.
When sponsoring a migrant worker for a role in the UK under the Tier 2 (General) category, the employer must show that they have ‘tested’ the UK labour market in finding a suitable worker who is already settled and present in the UK, otherwise known as the Resident Labour Market Test.
The Resident Labour Market Test (RLMT)
The RLMT has been introduced by the UK Visas and Immigration to protect the settled workforce which obligates an employer to advertise a job vacancy to settled workers before extending the job opening to migrant workers.
A settled worker is any individual worker who has the skills and experience the employer is seeking.
Exemptions to the RLMT
There are a number of exemptions to having to carry out a RLMT[i]:
- The migrant worker is already working for the employer and an extension of their Tier 2 (General) visa is required;
- The advertised job is in the shortage occupations list;
- The employer is sponsoring a migrant worker who currently has leave in the UK or is searching for post-study work;
- The total salary package for the job is £159,600 or above;
- The employer is a Higher Education Institution and was previously sponsoring a migrant worker who is returning to resume their post after a period of academic leave;
- The job is in a supernumerary research position and the migrant worker has been issued a scientific research award;
- The migrant worker will be sponsored as a doctor or dentist;
How the RLMT is carried out
All employers are required to place at least 2 job adverts for a period of 28 calendar days, either continuously or in 2 separate stages in which both stages must not be fewer than 7 calendar days. “The adverts make sure that there are no suitable workers already living permanent in the UK”[ii]. The advert must be a ‘genuine advert’.
If an employer has been unable to find a settled worker then the advertisement for migrant workers must be advertised within the 6 months before the employer has signed the certificate of sponsorship to a migrant. The certificate of sponsorship is discussed below.
If an employer finds that they have more than one candidate with all the necessary skills and experience they had advertised for, where one is a settled worker and the other a migrant worker, the employer must appoint the settled worker even if the migrant worker is more skilled and experienced.[iii]
Certificate of sponsorship
When an employer assigns a Tier 2 (General) certificate of sponsorship they are confirming that they have tested the UK market (carried out the RLMT) and have been unable to find a suitable settled worker to fill the job opening or an exemption is applicable.
The certificate of sponsorship must be assigned within 6 months of the date when the job opening was first advertised. Where the job opening has been advertised in 2 stages, the certificate of sponsorship must be assigned within 6 months of the date of the first of the 2 advertisements appeared.
The employer is required to provide full details of the RLMT carried out when assigning a certificate of sponsorship. If the employer has not used the RLMT they must explain why and which exemption from the RLMT applies.
The effect of the RLMT on Tier 2 migration
Whilst the RLMT may be an adequate tool for employers to source suitable settled workers, whether the RLMT fulfils this is a question to consider.
Based on statistics, it may show that the RLMT does not necessarily result to employers finding a suitable settled worker for their job positions. In 2016 there were 56,058 Tier 2 Skilled work sponsored visa applications and 56,012 applications in 2015[iv]. “In the year ending September 2016, the Office for National Statistics estimated there were 67,000 non-EU long term migrant workers in the UK, and this was similar to the previous 12 months”[v]. An increase each year is shown with the number of migrant workers entering the UK with a Tier 2 visa.
However, on the opposite side a survey conducted on 1,000 businesses in the UK established that 93% were at risk of having their sponsor licence revoked and only 7% “advertise vacancies correctly[vi]. The RLMT explicitly states that all job openings must be advertised in accordance with the guidelines stipulated by the UK Visas and Immigration. By advertising incorrectly it may show that the employers were not exposing themselves enough to find a suitable settled worker in the UK.
Reforms of the Tier 2 visa
“On 24 March the Government issued its preliminary response to the comprehensive review of Tier 2 (General) and Tier 2 (Intra-Company Transfer) routes carried out by the Migration Advisory Committee”[vii].
The reforms were implemented to “protect job opportunities for UK residents and reduce the UK businesses’ reliance on foreign workers”[viii] and to maintain the cap at 20,700 to ensure that Tier 2 visas are only granted to migrant workers who have the skills that are needed for the UK economy[ix]. More specifically, the Tier 2 (General) visa category was amended to reduce the number of migrant workers entering the UK, whilst the Tier 2 (Intra-Company Transfer) visa category was amended to “make it more difficult for multinational companies to transfer foreign employees into the UK”[x].
The main changes are as follows:
- For both the Tier 2 (General) and Tier 2 (Intra-Company Transfer) visa category a significant change is the introduction of an Immigration Skills Charge which will be levied on employers who employ migrant workers in skilled areas. The charge will be £1,000 per migrant worker per year, and a reduced rate of £364 per migrant worker for smaller companies and charities. The Migration Advisory Committee strongly supported the introduction of an Immigration Skills Charge to incentivise employers to reduce their reliance on migrant workers and to invest in training and upskilling UK workers[xi]. Exemptions to the Immigration Skills Charge are PhD-level jobs and international students who are switching from the student visa to the Tier 2 visa category. This is a “key protection to help retain the talented workers and students who are vital in helping the British economy grow”[xii].
- The minimum salary threshold for high earners has increased from £155,300 to £159,600. Employers who recruit individuals with a minimum salary of £159,600 will be exempt from carrying out the RLMT.
- The minimum salary threshold for sponsored workers over the age of 26 has been increased to £30,000 per year from £25,000. The minimum salary threshold for new entrants has remained at £20,800. By increasing salaries this will place more pressure on employers as they will be unable to recruit for lower paid positions from the workforce within the UK[xiii]. Start-up and growth businesses will especially be affected[xiv].
- Advertising methods will be extended for graduate recruitment in satisfying the RLMT.
- Extra weighting will be given within the annual limit to businesses sponsoring migrant graduates. Graduate will be permitted to switch roles in a company if they secure a permanent position at the end of the training programme. This will give employers flexibility in employing and retaining graduates, and increasing the confidence to invest in their training knowing that they should be able to retain those individuals more easily in the future[xv]. Therefore, potentially reducing migration.
- Nurses will remain on the Shortage Occupation List, but employers will still need to carry out a RLMT before recruiting a non-EEA nurse. (The Shortage Occupation list details the professions that are in high demand in the UK). This may “seem inconsistent to require employers to satisfy the RLMT for a role deemed to be shortage, but the Government is keen to ensure no suitable settled worker is displaced before sponsorship occurs”[xvi].
- Migrant students under a Tier 4 visa will be permitted to switch to a Tier 2 visa without the need for an employer to carry out a RLMT.
- Tier 2 (Intra-Company Transfer) migrant workers were previously exempt from the Immigration Health Surcharge (a mandatory contribution to the NHS) but now employers will be required to pay a surcharge of £200 per migrant worker per year.
- The current Tier 2 (Intra-Company Transfer) provisions have been simplified by requiring all intra-company transferees to qualify under a single visa category with a minimum salary threshold of £41,500. The Graduate Trainee category is exempt from this change but instead a reduction in the minimum salary threshold has been enforced from £24,800 to £23,000. This change “will reduce an employer’s option to transfer staff to the UK for specialist but lower paid positions”[xvii].
- The minimum salary threshold for Tier 2 (Intra-Company Transfer) migrant workers wishing to extend their visa in this category for up to 9 years has been reduced from £155,300 to £120,000. This enables the employer to retain their employee for a longer period.
Impact of the reforms
As the reforms have been recently enforced it is too early to statistically determine what the impact has been. However, many sectors have heavily criticised the reforms declaring that UK businesses and the economy will be negatively impacted.
Employers are likely to find the changes inhibiting their ability to bring non-EU nationals into the UK and increase their recruitment costs[xviii]. Before the reforms were put into place employers were finding it expensive to employ non-EU nationals as they were already required to pay for certificates of sponsorship, entry clearance / leave to remain fees, immigration health surcharge payment for the Tier 2 (General) category and relocation costs[xix]. Now with the Immigration Skills Charge and the expansion of the Immigration Health Surcharge, this will substantially increase an employer’s costs.
The greatest criticism has been towards the Immigration Skills Charge. “As many employers are already under significant financial pressure to compete globally, an imposition of the Immigration Skills Charge will further build the UK’s reputation as a business-unfriendly country for overseas nationals”[xx]. “From an immigration perspective, the imposition of the Immigration Skills Charge will only increase the costs for employers at the expense of settled workers, with no tangible long-term benefits elsewhere”[xxi].
Further, “many employers may decide to leave the position unfilled, instead recruit from the EU”[xxii] or risk having to use settled workers who are not skilled[xxiii]. “A potentially disastrous consequence is that if employers are unable to fill key posts for their businesses, the UK’s economy may be put at a competitive disadvantage”[xxiv].
TechUK, which represents 850 UK tech firms, expressed its displeasure in the changes and stated that they will inevitably affect small and medium businesses and international businesses investing in the UK[xxv]. The CEO of TechUK, Julian David, stated that the extra restrictions enforced on the Tier 2 visa, specifically the Immigration Skills Charge, increased salary thresholds and limitations on intra-company transfers, will not make it easy for companies to access the talent they need[xxvi]. Additionally, organisations such as Coadec, a non-profit trade body for start up companies, expressed the view that restricting access to skilled non-EU migrants will potentially limit the available talent pool and stifle the overall growth of the UK[xxvii], and employing non-EU migrants can help “plug the skills gap in rapidly growing sectors and often leading to an increase in UK domestic skills over the long-term”[xxviii].
Concerns from the medical profession have also appeared. The chair of the RCGP has urged the Home Office to add GPs to the Shortage Occupation List, making it easier for migrant doctors to work in general practice in the UK.[xxix] Professor Stokes-Lampard has stated that with a number of GPs set to retire in the next few years and the fact that it takes 10 years to train a GP from the UK, a much simpler and straightforward process for GPs entering the UK is required[xxx].
Nevertheless, some of the reforms may have a positive impact. UK businesses will now be more aware of being in compliant with the RLMT and not risk having their sponsor licence revoked, especially as employers will now be investing more significantly in recruiting migrant workers. Additionally, with the extended platforms which can now be permitted for employers to advertise their vacancies on for graduate hires, this may help employers more to source the type of graduates they need and in turn force the employers to invest in training to avoid the substantial costs of recruiting migrant workers.
[i] Home Office, ‘Tiers 2 and 5: Guidance for Sponsors’, Version 05/17, pages 118-121, <https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/616206/Tier_25_guidance_05-2017.pdf>
[ii] “UV visa sponsorship for employers”, <https://www.gov.uk/uk-visa-sponsorship-employers/job-suitability>
[iii] Home Office, ‘Tiers 2 and 5: Guidance for Sponsors’, Version 05/17, page 118, <https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/616206/Tier_25_guidance_05-2017.pdf>
[iv] National Statistics Work, (23 February 2017) < https://www.gov.uk/government/publications/immigration-statistics-october-to-december-2016/work>
[vi] Jo Faragher, , ‘Employers ‘sleepwalking’ on right-to-work compliance for overseas workers’, Personnel Today, (28 September 2017), < https://www.personneltoday.com/hr/employers-sleepwalking-right-work-compliance-overseas-workers/>
[vii] Tilly Oyetti, ‘Major Tier 2 reform coming in Autumn 2016 and April 2017’, Charles Russell Speechlys, Lexology, (12th April 2016), < https://www.lexology.com/library/detail.aspx?g=7fdf5ea7-11e8-47ca-91d0-b0ff5ac5bf56>
[viii] Home Office, ‘Visa changes to reduce reliance on foreign workers’, (24th March 2016), < https://www.gov.uk/government/news/visa-changes-to-reduce-reliance-on-foreign-workers>
[ix] House of Commons, ‘Immigration: skills shortages’, < https://publications.parliament.uk/pa/cm201516/cmselect/cmhaff/429/42903.htm>
[x] Jemima Johnstone, ‘Changes to UK Tier 2 (Intra-Company Transfer) Visa, DavidsonMorris Solicitors, Lexology, (14th August 2016), < https://www.lexology.com/library/detail.aspx?g=48c30027-11be-4200-b3a2-5062a969daed> 2
[xi] James Brokenshire, ‘Tier 2 (Skilled Workers): Written Statement – HCWS660’, (24th March 2016), < https://www.parliament.uk/business/publications/written-questions-answers-statements/written-statement/Commons/2016-03-24/HCWS660/>
[xii] Department for Business, Innovation & Skills and Jo Johnson MP, ‘Government’s new Immigration Skills Charge to incentivize training of British workers’, (24th March 2016), < https://www.gov.uk/government/news/governments-new-immigration-skills-charge-to-incentivise-training-of-british-workers>
[xiii] Charlie Pring and Vikki Wiberg, ‘The outlook for UK immigration – the next 12 months, Taylor Wessing, Lexology, (12th May 2016), < https://www.lexology.com/library/detail.aspx?g=dff1a55d-144a-49ba-baaf-ab67bf291b37>
[xv] Charlie Pring and Vikki Wiberg, ‘The outlook for UK immigration – the next 12 months, Taylor Wessing, Lexology, (12th May 2016), < https://www.lexology.com/library/detail.aspx?g=dff1a55d-144a-49ba-baaf-ab67bf291b37>
[xvi] Yuichi Sekine and Lucy Garrett, ‘Home Office Announce Changes to Tier 2 Immigration Route following MAC Review’, The In-House Lawyer, (5th May 2016), < http://www.inhouselawyer.co.uk/legal-briefing/home-office-announce-changes-to-tier-2-immigration-route-following-mac-review/>
[xvii] Charlie Pring and Vikki Wiberg, ‘The outlook for UK immigration – the next 12 months, Taylor Wessing, Lexology, (12th May 2016), < https://www.lexology.com/library/detail.aspx?g=dff1a55d-144a-49ba-baaf-ab67bf291b37>
[xviii] Yassar Lodhi and Emma Morgan, ‘Key changes to Tier 2 from 6 April 2017’, DAC Beachcroft, Lexology, (3rd April 2017), < https://www.lexology.com/library/detail.aspx?g=6927b9ed-61bf-4027-b272-ebbeed29d5a2>
[xix] Tilly Oyetti, ‘Major Tier 2 reform coming in Autumn 2016 and April 2017’, Charles Russell Speechlys, Lexology, (12th April 2016), < https://www.lexology.com/library/detail.aspx?g=7fdf5ea7-11e8-47ca-91d0-b0ff5ac5bf56>
[xx] Yuichi Sekine and Lucy Garrett, ‘Home Office Announce Changes to Tier 2 Immigration Route following MAC Review’, The In-House Lawyer, (5th May 2016), < http://www.inhouselawyer.co.uk/legal-briefing/home-office-announce-changes-to-tier-2-immigration-route-following-mac-review/>
[xxv] Caroline Preece, TechUK brands Tier 2 immigration visa reforms ‘disappointing’, ITPRO, (24th March 2016), <http://www.itpro.co.uk/strategy/26267/techuk-brands-tier-2-immigration-visa-reforms-disappointing>
[xxix] Carolyn Wickware, ‘RCGP chair urges Home Office to add GPs to shortage occupation list’, Pulse, (13th October 2017), < http://www.pulsetoday.co.uk/home/finance-and-practice-life-news/rcgp-chair-urges-home-office-to-add-gps-to-shortage-occupation-list/20035451.article>