Navigating New Immigration Rules: Essential Updates for UK Business Sponsors and Employers

We are pleased to bring you our Immigration update, where we take a look into the most recent immigration updates impacting business sponsors and employers.

In this blog, we will cover:

• Changes to the Skilled Worker salary thresholds;
• The new Immigration Salary List (ISL) and what it means for shortage occupations;
• The “new entrant” provision and when you can pay someone less than the prescribed threshold; and
• Transitional arrangements for existing employees on sponsored visas.

Employers who have historically had vacancies eligible for sponsorship under such routes (i.e. Skilled Worker route) will need to check whether they will continue to be eligible for sponsorship under the new rules before committing to offer sponsorship to successful candidates from May 2024.

Skilled Worker Salary Thresholds

On 13 March 2024, the UK government published the latest updates to the Immigration Rules, which included changes to the salary thresholds for the Skilled Worker visa route. Many Companies and other organisations will sponsor migrant workers under this visa route, and as such these changes are relevant for both existing and new sponsored staff, and any recruiting managers who are hiring international applicants.

The new rules and salary thresholds came into effect on 4 April 2024, and includes provisions for individuals whose sponsorship is based on the old rules and thresholds.

The old salary threshold was £26,200, and this is increased to £38,700 for new sponsorships (starting on or after 4 April 2024), or £29,000 for existing sponsorships (started on or before 3 April 2024).

The going rates for individual Standard Occupational Codes (SOC) are also changing, and will now be based on 50th percentile average earnings for new sponsorships, or 25th percentile average earnings for existing sponsorships. This will mean an increase for some SOC and a decrease for others.

Immigrant Salary List

On 4 December 2023, the Home Secretary announced several changes to the immigration system related to the Skilled Worker route. Amongst these changes, it was announced that, from April 2024, the Shortage Occupation List (SOL) would be replaced with the Immigration Salary List (ISL).

The ISL is a list of occupations where a reduced general salary threshold applies to applications on the Skilled Worker route. In other words, if your job is on the Immigration Salary List, you (or your employee) can qualify for a Skilled Worker Visa by being paid less than the standard general salary requirement applicable to the Skilled Worker route. This should make it easier for employers to recruit for ISL roles and open up opportunities for skilled workers to work in the UK in ISL occupations.

Employers seeking to recruit under the Skilled Worker route must pay their skilled workers a salary which equals or exceeds both a general salary threshold and the occupation-specific threshold or ‘going rate’ for the applicable SOC 2020 occupation code.

The ISL is a list of occupations where a reduced general salary threshold applies to applications on the Skilled Worker route. In simple terms, if a job is on the Immigration Salary List, the general salary threshold is 80% of the Skilled Worker route’s usual minimum rate.

New Entrant Provision

The Home Office retained the ‘new entrant’ salary discounts for those applying for a Skilled Worker visa in certain cases (including students switching to Skilled Worker, applicants under 26 years old, and those working towards full registration or chartered status, such as architects, accountants and solicitors).

The new entrant discount reduces the Skilled Worker minimum salary threshold to the higher of £30,960 per year or 70% of the going rate for the applicable SOC 2020 occupation code. For example, for a new entrant applicant taking up a role which falls into occupation code 2134, the minimum salary threshold for a 37.5 hour working week would be £34,580 (70% of £49,400).

Both thresholds are significantly higher than the pre 4 April 2024 threshold of £20,960. This could well mean that many graduate roles are no longer eligible for sponsorship.

It is also important to remember that this discount can only apply for a maximum of four years, including any time spent on a Graduate visa. At the end of the four year period, the individual will need to meet the higher salary thresholds.

The full applicable going rate salary must be paid when someone is applying for settlement.

Summary

Lots of things are changing (and have already changed) under the new immigration rules. For example, the Home Office has changed salary thresholds, new SOC Codes and the reduction in the number of roles that are eligible for sponsorship – so it is easy to lose track of them.

Make sure that you take a close look at any processes, policy documents and contractual terms that relate to right-to-work checks and immigration matters to ensure that they remain fit for purpose and are legally compliant.

If out-of-date processes are followed, this could risk a visa application being refused by the Home Office or compliance action being taken if you are a sponsor (such as the revocation of a sponsor licence).

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