CIPD Voice: Issue 22

The clock is now ticking louder for EU workers that want live and work in the UK as we enter the final year before free movement ends. Many employers report that they are ill-prepared for the introduction of the new migration restrictions for EU citizens. This is partly because there remains uncertainty about the government’s post-Brexit immigration policy, especially in terms of the Australian points-based system that has been heavily publicised by the new conservative administration. Nonetheless, the government’s migration advisory body, the Migration Advisory Committee (MAC), has recently provided some additional clues about how the overall system might look like.

Overall, the MAC report’s recommendations, which tend to get adopted by government, are good news for employers. The main headline decision to lower the minimum salary threshold to £25, 600 from £30, 000 will provide more leeway for employers, especially public service occupations such as teachers and NHS staff. However, it is important to note that the salary threshold varies; rising for more highly-paid occupations and falling for new entrants aged under 26. The one area of disappointment the is the rejection of the idea of lower salary thresholds for shortage occupations, which will concern employers in key sectors such as social care. Given that the skill threshold also looks set to be lowered to A-Level occupations, the CIPD will continue make the case for its inclusion in the coming weeks.

On the upside, the mooted suggestion that there might be regional variation in salary thresholds or indeed a regional migration policy has been rejected by the MAC. As CIPD research has shown, employers support the simplicity of a UK-wide immigration system, partly because it is already such a daunting prospect for many. The administrative simplicity will delight employers with multiple sites across the UK in particular; notwithstanding the sensible retention of a separate shortage occupation list for Scotland.

The other major proposed development is the expansion of a new unsponsored route which will allow migrations to come and live and work in the UK. The route, which will modify Tier 1 in its current form, will put a cap on numbers and prioritise individuals with key attributes, such as those with qualifications in STEM or creative fields. Together with other proposed temporary routes, such as the Youth Mobility Scheme and the one-year temporary visa, these routes will ease the cost and administrative burden that is alarming many employers. Indeed, consultations with CIPD members suggest that many are unaware of these useful safety valves, which could be particularly appealing to employers with little or no experience of using the current system.

With this in mind, employers will be keen to see the temporary one-year visa extended to two years, which again would require no job offer, when the government makes its final policy announcement in spring. Which raises the question of whether the government accepts the sensible and evidence-led advice from the MAC. Previous administrations have a very strong record in following the advice of the MAC. However, one shouldn’t be surprised if some of the MAC’s recommendations are not adopted given the Home Secretary’s response to the report, which pointed to the election result as a mandate for change.

In the meantime, the important thing for employers is to get up to speed with the new system fast. This should include an assessment of the implications for costs, the composition of the workforce and the extra resource and expertise that might be required within the HR function to deal with the new system from 2021.

Gerwyn Davies

Gerwyn Davies, Labour Market Adviser

Gerwyn is the CIPD’s Public Policy Adviser for a wide range of labour market issues. With lead responsibility for welfare reform, migration and zero-hour contracts at the CIPD, Gerwyn has led and shaped the policy debate and achieved substantial national media coverage through various publications. These include Zero-hours contracts: myth and reality (2013) and The growth of EU labour: assessing the impact on the UK labour market (2014). In addition Gerwyn authors the institute’s high profile and influential quarterly Labour market outlook report. Gerwyn is an experienced labour market commentator, making regular appearances in the national media and on other public platforms, including several appearances before the House of Commons Work and Pensions select committee.