Guides & Advice

Brexit and the end of free movement

Published: 17th January 2021
Area: Corporate & Commercial

Although the UK left the EU on 31 January 2020, the 12 month transition period meant that free movement did not effectively end until 31 December 2020.

Now that the transition period is over, it is vital that employers are aware of their new obligations and responsibilities regarding recruiting from abroad, as well as ensuring their staff maintain the right to work in the UK.

What is the EU Settlement Scheme?

The UK government’s EU Settlement Scheme offers EU, European Economic Area (EEA) nationals and Swiss nationals the opportunity to protect their residence in the UK now that the transition period has ended, provided they were in the UK before 31 December 2020.

For the purposes of the Settlement Scheme, citizens of countries in the European Economic Area (Norway, Lichtenstein, and Iceland) have the same eligibility as full EU citizens.

What is the deadline for the EU Settlement Scheme?

The government has allowed a grace period up to 30 June 2021, whereby eligible EU nationals living in the UK who have not yet applied for settled or pre-settled status can still do so.  It is important to note that this only applies to EU nationals who moved to the UK before 31 December 2020, meaning the grace period will not allow any further EU citizens to move to the UK for work without going through the UK’s points based system, which has previously applied to citizens of non-EU countries.

EU nationals who moved to the UK, but have yet to apply for settled or pre-settled status, may be at risk of losing their right to live and work in the UK if they miss out on this scheme. Employers may wish to encourage staff to check their eligibility and, if necessary, make an application for settled or pre-settled status before the deadline. Failure to take advantage of the grace period could result in employers having to dismiss employees who have lost their right to work.

While there is no requirement for employers to carry out retrospective right to work checks for existing employees, for new hires from 1 January 2021 the risk of potentially losing business critical staff at short notice should be taken seriously by any business. Ignorance of the need to apply to these schemes will not be a valid excuse.

Applying for a sponsor licence

Any company looking to recruit foreign nationals in 2021 will require a sponsor licence from the Home Office. Previously, many UK businesses were able to recruit EU nationals without the need for a licence, as EU citizens merely needed to present proof of citizenship of an EU state before being hired.

With many UK businesses taking the steps to apply for a sponsor licence in 2021, the Home Office are understandably busy. Therefore it is advisable to make an application well in advance of the need to sponsor visas to prevent any delays, particularly businesses that foresee the need to recruit from abroad in the near future.

Businesses will need to factor in time for the preparation and processing of visa applications in their recruitment timelines going forward. They may also want to review the quota allocated to them through their sponsor certificate, and whether an application for an increased quota is appropriate. Differing rules will apply for intra-company transfers.

Our specialist business immigration team can assist and advise with applying for a sponsor licence.

EU nationals and non-EU nationals are now treated the same

As the government has been promising for many years, the UK has now expanded its points-based immigration system to apply to all foreign nationals equally. EU nationals must now follow the same system that non-EU immigrants have been subject to.

Additional options will still be available for non-UK nationals to come to the UK using a variety of visa options. These include, but aren’t limited to, Global Talent and Graduate visa options, as well as health and care worker, or creative and sporting visas. Each will have their own specific requirements.

Watch our short to our webinar on understanding the UK’s new immigration system

What does the future hold?

It is notable that with the new immigration rules, the UK has abolished its annual cap on migration to the UK, applied to immigrants from outside the EU under the old regime. Whether this will lead to an overall increase or decrease in net migration remains to be seen.

It is notable that the government’s net migration figures often include students coming to the UK to study at universities. It is likely that there will be a fall in students coming to the UK from EU countries in 2021 and beyond, as they will now have to pay standard international fees, which often far exceed the previous regime for EU students. Read more about the new student immigration routes.

It is no secret that the UK’s new immigration policy is encouraging skilled workers to come to the UK, with no preference from their country of origin. The new regime will offer no routes for ‘low skilled’ workers to come to the UK for work purposes, meaning the UK’s pool of employable low skilled workers will shrink from across the EU, to being drawn from the existing UK workforce only.

For employers, the UK’s new immigration policy may encourage businesses to up-skill their existing workforce, particularly for those high skilled jobs where specialist vacancies might have previously been filled by lateral hires from elsewhere in the EU.

For those jobs that cannot be filled from upskilling an existing workforce, the countries from which incoming hires may come is likely to change, with there no longer being an advantage in speed or ease in the hiring of an EU citizen over someone from, say, India or the USA.

We can help keep your global workforce moving

For further guidance and support speak to Tijen Ahmet in our business immigration team.

From inspirational SHMA Talks to informative webinars, we also have lots of educational and entertaining content for life and business. Visit SHMA® ON DEMAND.

Our free legal helpline offers bespoke guidance on a range of subjects, from employment and general business matters through to director’s responsibilities, insolvency, restructuring, funding and disputes. We also have a team of experts on hand for any queries on family and private matters too. Available from 10am-12pm Monday to Friday, call 0800 689 4064.

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