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Significant changes to business immigration rules

21 April 2016

Following the publication of the Migration Advisory Committee’s proposals for Tier 2 earlier this year, the Home Office has recently confirmed that the following changes will be implemented over the next 12 months:

Autumn 2016

  •  Increase in the Tier 2 (General) minimum salary threshold to £25,000 for experienced workers. (The minimum threshold for new entrants will remain at £20,800 and exemptions will exist until July 2019 in respect of certain occupations.)
  • Increase in the salary threshold to £30,000 in respect of Tier 2 (ICT) short term category.
  • Closure of the Tier 2 (ICT) Skills Transfer category to new applicants.
  • Removal of the exemption from the Immigration Health Surcharge for the Tier 2 (ICT) category. (Therefore all intra-company transferees will be required to pay the immigration health surcharge.)
  • Reduction in the salary requirement for the Tier 2 (Graduate Trainee) category from £24,000 to £23,000 and an increase in the number of places available to companies from five to twenty per year.
  • Greater weighting afforded to overseas graduates in Tier 2 (General) monthly allocation rounds.

April 2017

  • Increase in the Tier 2 (General) minimum salary threshold to £30,000 for experienced workers (exemptions will still apply in respect of specific occupations).
  • Closure of the Tier 2 (ICT) Short Term category to new applicants – essentially creating a single Tier 2 ICT category with a standard minimum salary requirement of £41,500 (with the exception of graduate trainees).
  • Introduction of an Immigration Skills Charge – this will be charged to all Tier 2 employers and will be applicable in both the ICT and General categories.  The charge will be £1,000 per certificate of sponsorship per year. (Lower rates will be payable by charities and smaller businesses.)
  • The minimum salary threshold for intra-company transferees working in the UK for between 5-9 years will be reduced from £155,300 to £120,000.
  • Removal of the requirement for an individual applying in the Long-Term ICT visa category to have one year’s service where the applicant is earning over £73,900.
  • Introduction of a waiver for the Resident Labour Market Test and prioritisation of Tier 2 (General) places where the visa grant(s) are in support of the relocation of a high-value business to the UK, or an inward investment project.
  • Employers will continue to be able to sponsor non-EEA graduates of UK universities without having to carry out a resident labour market test and without being subject to the annual limit on Tier 2 (General) places.  Graduates will also be able to switch roles once they have secured a permanent job at the end of their training programme (without the Sponsor having to undertake a resident labour market test).
  • If there are any subsequent review of allowances under the ICT categories, they are also likely to be implemented next spring.

As yet, the Home Office has not released the finer details so many questions remain in the air, particularly surrounding the Immigration Skills Charge, the increase to minimum salary thresholds, and changes to ICT.

We will share further information as it becomes available; in the meantime if you have a specific query, please email a member of our employment team, who will be more than happy to advise.

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Matthew Clayton MA LLM (Cantab), CIPP/E
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Mathew Clayton
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