Tessa Robinson in RB’s Employment Team looks at the impact of some changes to the Tier system introduced in November 2016

Many businesses in the UK will have employees who are not UK nationals, whether because they can’t fill vacancies from the UK labour force or because, due to the global nature of their business, their employees are seconded from subsidiaries located abroad.

The UK currently operates a tiered points based system which determines who can stay and for how long. Whilst citizens from EU members’ states are not subject to this system and may come and go as they please, it is anticipated that this will change when we leave the EU. Until then the current system is likely to remain in place, subject to changes that are made periodically.

When businesses choose to hire non UK nationals, the most common route is via Tier 2 of the UK’s immigration system. This tier allows businesses to employ ‘skilled workers’ rom outside the EEA who have a job offer in the UK. Tier 2 is broken down into two subcategories: Intra-Company Transfers and a more General route.

Tier 2 Intra-Company Transfers

As the name suggests, Intra-Company Transfers (ICT) provide a mechanism to allow global companies to move employees between overseas subsidiaries. It does require that the employer becomes a sponsor, but the effect is that the company is then able to grant its own certificates of sponsorship.

Following a review by the Independent Migration Advisory Committee, four changes came into force on 24th November for those certificates of sponsorship assigned by Tier 2 sponsors on or after this date:

  • Increasing the Tier 2 (General) salary threshold for experienced workers to £25,000 (with some exemptions).
  • Increasing the Tier 2 (ICT) salary threshold for short term staff to £30,000.
  • Reducing the Tier 2 (ICT) graduate trainee threshold to £23,000 and increasing the number of places to 20 per company per year.
  • Closing the Tier 2 (ICT) skills transfer subcategory.

Under the Tier 2 (ICT) skills transfer subcategory, employees did not have to be employed by their employer overseas for a set period of time. Employees under the remaining Tier 2 ICT sub-categories need to have been employed by their overseas employer for at least 12 months (from April 2017 those earning more than £73,900 will be exempt from this requirement), must be paid a prescribed salary and can only be transferred for a role that can’t be filled by a new UK recruit. This is far more restrictive than the previous skills transfer sub-category.

Individuals currently in the UK under the Tier 2 (ICT) skills transfer sub-category will be able to remain until their visa expires. Those companies wishing to bring individuals to the UK for less than 12 months under a Tier 2 (ICT) visa should start the process soon or look into alternative options.

Tier 2 General

No changes were made in November to this visa category, however it is therefore envisaged that Tier 2 (General) visas will be increasingly used by organisations if the minimum employment period for a Tier 2 (Intra Company Transfer) visa cannot be met.

However, the qualification requirements and procedure for this sub-category are more restrictive and onerous than a Tier 2 (ICT) visa and so employers should be aware of the additional processes which must be followed.

Under this category, employers must carry out a Resident Labour Market Test (RLMT). This test essentially shows that there is no suitable settled worker available to fill the job. It therefore protects the settled workforce in the UK. Employers are therefore usually required to advertise the job in two places and for 28 days each (either continuously or in two stages).

Employers must be able to show they did not find a suitable worker. Guidance published by the Government states, “If you find that you have more than one candidate with all the necessary skills and experience that you advertised for, where one is a settled worker and the other is a migrant, you must appoint the settled worker even if the migrant is more skilled or experienced.”

Last November a new suitability criteria for organisations wishing to hold a sponsor licence was added. This was whether the employer can offer a genuine vacancy which meets the criteria of the category it is applying for. The RLMT must therefore be genuine, and an overseas employee should not be offered the job before the test is carried out.

Employers wishing to recruit from outside the EEA will need to ensure the advert under the RLMT is drafted with skill and care to meet their wishes, and that extra time is factored in to the visa application process to ensure the minimum advertising period is met. They should also be aware of the increased salary requirements and budget accordingly.

Future Changes

Employers should note that further changes to Tier 2 (ICT) category are in the pipeline for April 2017. The health surcharge will become payable (this category is currently exempt from making this payment). A date for this change will be announced in due course. It is also expected that from April 2017, the Tier 2 ICT short term sub-category will be abolished, meaning employees coming to the UK via an ICT will need to transfer for 12 months or longer. In addition there will be an increase to the minimum salary threshold for experienced workers under Tier 2 (General) from £25,000 to £30,000.

The final change which is due in April 2017 is the introduction of the Immigration Skills Charge of £1,000 per year, per migrant. This charge is to encourage employers to invest in training workers from the UK, as opposed to recruiting from outside the EEA.

It is clear that the government is placing more and more restrictions upon organisations to ensure they recruit settled individuals before looking overseas. With more changes to come following Brexit, employers should take the opportunity now to audit their workforce, and assess whether there are any individuals which could be affected by any changes which are announced in due course.

Our immigration specialists provide advice and assistance to businesses wishing to recruit from overseas. From advising on the best and most appropriate tier to use, to guiding and assisting them through the process required.

Our specialists also provide advice and assistance when changes are announced to ensure organisations continue to be compliant with all legislation. We also work with partner law firms around the world to provide quick and effective solutions to problems on a global scale if needed.

If you would like any further information on Business Immigration and how we can help your business, please contact Tessa Robinson for a free initial chat (trobinson@rawlisonbutler.com or

01293 558553).

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Rawlison Butler