Migrant workers will be critical to the UK’s economic rebirth

Migrant workers played a key role in rebuilding the UK economy after the Second World War, so will they be able to help businesses recover from the shock of Covid-19? Employers need to prepare for next year’s changes to immigration rules now, writes Yash Dubal.

In May, the controversial Immigration and Social Security Co-ordination (EU Withdrawal) Bill 2020 received its second reading in Parliament. MPs approved the general principles of the legislation by 351 votes to 252 and it will now undergo further scrutiny in the Commons and then the House of Lords before it can receive Royal Assent and become law.

Official communication paints the Bill in a positive light. According to the government the legislation “represents an important milestone in paving the way for the new immigration system that will deliver for the UK for years to come and puts an end to the European Union’s rules on free movement”.

Not everyone agrees with this assessment. Critics argue that the focus on issuing unlimited visas for high-skilled professions will create personnel shortages in key areas such as caring. Since the law was drafted the world has changed dramatically. It is impossible now not to view any fundamental changes in business employment and economics through the prism of the coronavirus pandemic. Assessing what the long and short-term effects will be is hard, given the rate events change.

International travel is still largely at a standstill and no one knows when that will change or what restrictions will remain. The government has announced some transitional arrangements for migrant workers, such as visa extensions for those who cannot leave the UK because of travel restrictions. Some frontline health workers and their families will also get automatic visa extensions.

What we do know is that under the new immigration regime, freedom of movement into the UK by EU citizens will be rescinded and replaced by a points-based system applicable to everyone from overseas who plans to work and live in Britain.

Rebuilding the economy

As the UK economy struggles back to life after lockdown one thing is certain: migrants will play a vital role in the rebuilding process, particularly in the hospitality and healthcare sectors. They always do. After the Second World War economists realised the UK needed foreign workers to fill the labour market and welcomed thousands of people from Ireland, Europe and the Commonwealth. They settled here in the fifties, sixties and seventies and worked on building sites, in healthcare, in the public sector and in business. Many went on to set up their own successful companies. They worked hard, paid taxes, employed people, raised families and contributed to society in myriad positive ways. Many of their children now prop up the NHS.

The UK offers so much for migrants, and migrants offer the UK so much in return. Many come from poor backgrounds and from parts of the world where opportunities are limited. They don’t uproot themselves from their families and their homelands lightly. Many take huge physical and financial risks to get to the UK. They come here because they want to have better lives, and by bettering their lives they benefit the economy because they work hard, pay into the system and spend the money they earn in the UK. The idea that all migrants flock to the UK to claim benefits and live off the system is false. A tiny number might, but on the whole, migrants have a unique mindset and a burning desire to succeed. They drive innovation and economic development.

For businesses planning to capitalise on this migrant effect and employ overseas workers from next year when the law is due to come into effect, it is sensible to start planning now despite the uncertainty, and to take measures to ensure a smooth transition from the current system to the new one.

Currently, fewer than 30,000 of the UK’s employers are approved to employ foreign workers. With 1.4 million British businesses employing people in 2019, this means only a tiny percentage are geared up to take advantage of the global personnel market.

In order to exploit the global population of skilled workers, employers need to be on a Home Office list of approved sponsors. The rule also applies to those currently employing skilled workers from Europe who do not need visas now but will need them from next year. To future-proof personnel functions, those without a sponsor license are advised to apply for one as soon as possible as it is expected that the Home Office will be overwhelmed with a surge of applications as employers gear up to cope with the new system.

Sponsorship routes

Employers also need to consider what type of worker they want to sponsor. There are two main categories of visa for skilled workers: Tier 2 for long-term job offers, and Tier 5 for skilled temporary workers.

Applications for a licence can be made through the Home Office website. However, the process is cumbersome, and many employers prefer to let legal experts prepare the application for them.

Applicants can expect a visit from a UK Visa and Immigration compliance officer to check there is a genuine need for a licence and to ensure correct systems are in place to manage sponsored workers. The officer also checks that the application details are accurate.

There are also several financial implications potential approved sponsors need to consider including licence fees, certificate of sponsorship issuing fees and the Immigration Skills Charge, which is essentially a tax levied on businesses for employing foreign workers.

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As you can see, there are many considerations to bear in mind and the situation can be complex. The benefits to business of using overseas workers however, are well-established and with a change in regulations, complicated by the coronavirus, it makes good business sense to start planning now.

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