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Post Brexit – Your Current and Prospective European Staff

Amid the global pandemic that has taken over the world for the past months, Brexit appears to be suffering from political extinction. Yet, the leaving of the EU is imminent and employers should keep in mind that on 31st December 2020, EU staff will no longer have an automatic right to live and work in the UK.

Your existing EU staff

Your EU, EEA or Swiss staff currently living in the UK must apply for a ‘settled’ or ‘pre-settled’ status before 30 June 2021 under the EU Settlement Scheme to continue being legally recognised as a resident of the UK. The application is free

Employees do not need to apply if:

•             They are an Irish citizens

•             They have an Indefinite Leave to Enter or Remain in the UK

How should employees choose between Settled Status or Pre-Settled Status:

Employees that have continuously been in the UK for 5 years or more can apply for settled status. They will have five years’ continuous residence as long as they have been in the UK for at least six months in any 12 months period for five years in a row.

Settled status will entitle an employee to stay and work in the UK for as long as they wish. However, it can be lost if an employee lives for more than five years in a row outside of the UK.

Employees that have been in the UK for less than 5 years can apply for pre-settled status.

Pre-settled status will allow an employee to remain in the UK for a period of five years from the date they are given pre-settled status. Upon expiry of that five year period, they will be required to apply for settled status should they wish to remain in the UK for longer. However, they do not have to wait until the end of the five-year period and can apply for settled status as soon as they have reached five years’ continuous residence.

An employee with pre-settled status has the same rights as those with settled status but cannot spend more than two years in a row outside of the UK in order to retain their pre-settled status.

As an employer, what should you do in respect of your existing EU staff?

Employers are under no legal obligation to communicate the EU Settlement Scheme to staff.

However, for employers that want to make sure that their employees are aware of the upcoming changes, the Government has drafted a “EU Settlement Scheme: employer toolkit” which includes different documents that can be communicated to employees. In particular, there is a template letter that employers can send to all of their EU staff.

When communicating the toolkit, employers should be careful not to interpret information on the EU Settlement Scheme or to provide immigration advice unless they are qualified to do so.

Indeed, the risk would be to give incorrect advice to employees that could cost them their settled status and eventually, their right to work in the UK. In this scenario, employee could raise a claim against their employers. If your staff asks you for advice, do simply direct them to the official step by step  Home Office Guidance on the scheme where they can get all of the necessary information.

Until the end of the transaction period, employers should be aware that there is absolutely no requirement for their employee to inform them that they have applied or the outcome of their application, employers should not check. Moreover, employers should never make an offer of employment, or continued employment, dependent on an individual having made an application. Doing so could open the door to a discrimination claim.

Everything changes from 1 July 2021: employers will no longer be able to accept an EEA or Swiss passport alone as evidence of a permanent right to work in the UK for new employees. However, employers will not be required to make any retrospective checks for existing employees.

  • Your future and prospective EU staff

If a prospective employee comes to the UK after the end of Brexit’s “transition period” on 31st  December 2020, they will not fall under the Withdrawal Agreement.

Therefore, from January 1st if you wish to employ EU staff, as you would for most other nationalities in the world, you will need to sponsor their work visa to come work in the UK.

Sponsoring a work visa is not a breeze:

  • Employers might need to obtain a Sponsor Licence

First of all, if you have never employed anyone needing a visa, you may now not be permitted to do so by the Home Office. Your company will need to apply for a Sponsor Licence. Different criteria will be taken into account for you to be able to receive the licence, such as making sure that the business is a well-run UK company and that it has never acted in dishonesty.

If you might require hiring outside of the UK after the end of the transition period, we would advise for you to consider applying for a Sponsor Licence ASAP as, in the current times, it may take an average of 2 months to be granted one.

  • Each visa sponsoring can cost around £1,5K

Not only is the sponsor system bureaucratic and time consuming but it is also very costly. It quickly proves much cheaper to incentivise existing staff to stay with your business than having to sponsor new candidate.

Due to covid-19 and the terrible impact it has had on the economy, we are currently seeing massive redundancies and spike in unemployment. However, in deciding whether you should reduce your workforce, employers should keep in mind the cost of re-employing if their staff currently consist of largely EU citizens.

We would advise employers to set up a Brexit Team which would be in charge of researching its general impact on the company, including how it will affect its workforce. They should produce a good audit of your current workforce in order to understand the proportion of EU staff,  consider whether the typical vacancies arising in your business will qualify under the new requirements for job titles that can be sponsored (see below), and what this might mean financially for the company in the future.

Lastly, if your company aims to hire what could presumably be EU staff at the start of the next year, you might wish to consider starting recruiting now instead in order to avoid any additional costs such as visas.

  • Only certain types of jobs can be “sponsored”.

There will be significant changes to the immigration rules from next year, however similarly to what is currently in force, staff requiring a visa will need to prove their ability to speak English.

The visa system will still be based on points, and future employees will need to get at least 70 to be eligible. Not all jobs can be sponsored, employers will only be able to sponsor jobs for individuals with the appropriate skill level (RQF 3 level) and which are paid a minimum salary of around 25K per year.

The criteria needed to enable an EU candidate to work for your company raise many different issues, a key one being that the skills requirements for sponsorship may be very far from your current EU workforce job duties raising a skills gap risk impacting on your workforce recruitment and retention strategies.

In one of its recent policies, the government stated: “We need to shift the focus of our economy away from reliance on cheap labour from Europe and instead concentrate on investment in technology and automation. Employers will need to adjust”. This will likely at least in the short term and COVID19 aside, prove very problematic for industries such as hospitality or construction, who rely heavily on EU employees.

Register here to join our free webinar on 24th November at 11am for clarity on:

  • The right to work after the transition period
  • What your EU workforce in the UK need to apply for to be able to work
  • What Brexit may mean for existing UK employment law
  • Which new laws can be expected to change employment practices in 2021.

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