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MAC Recommendations... Implemented

MAC Recommendations... Implemented

Following the Migration Advisory Committee (“MAC”) review of Tier 2 in the latter half of 2015 and the subsequent report which was published in January 2016, the UK government has now considered the recommendations of MAC and has published its response.  In short, the government’s intention is to implement the majority of MAC’s proposals (albeit on a phased basis between autumn 2016 and April 2017) and the most significant changes are likely to be felt by the Tier 2 (General) and Tier 2 (Intra-Company Transfer) (“ICT”) routes to work in the UK. 

Tier 2 (General)

  • Although the current minimum threshold for new entrants will remain at its current rate of £20,800, from autumn 2016, the minimum salary threshold for Tier 2 (General) will increase from £20,800 to £25,000. This minimum level will increase further in April 2017 to £30,000.
  • The increased minimum salary thresholds will not be applied to certain occupations (including, nurses, medical radiographers, paramedics and maths, physics and chemistry teachers) until 2019.
  • Although nurses will still fall within the list of shortage occupational codes, a Resident Labour Market Test will now be required to be carried out in respect of nurses who apply from outwith the EEA.
  • It is the government’s intention to make it easier to for overseas graduates to switch roles within a company after they successfully secure a role following the completion of their training programme.

Tier 2 (Intra-company Transfer)

  • The Tier 2 (ICT) route to work in the UK currently has four sub-categories: long-term staff, short-term staff, graduate trainee and skills transfer.  However, the government is now proposing that these routes (with the exception of graduate trainee) be consolidated into one single Tier 2 (ICT) route.  From autumn 2016, therefore, the Tier 2 (ICT) skills transfer category will be closed to new applicants and the same will happen in respect of the Tier 2 (ICT) short term category in April 2017.
  • The Tier 2 (ICT) route will also be subject to an increased minimum salary level of £30,000, but for applicants who are to earn in excess of £73,900, they will no longer be required to work for the overseas company for a minimum period of one year to be eligble.
  • The higher earnings threshold for long-term ICTs, which is currently set at £155,300, is to be reduced to £120,000 from April 2017 for individuals looking to stay in the UK for between five and nine years.
  • Although the immigration health surcharge is currently not applicable for Tier 2 (ICT) applicants, the government plans to introduce this as a requirement in respect of the Tier 2 (ICT) route later this year.
  • On a more positive note, the government has decided not to implement MAC’s recommendation that the qualifying period during which a Tier 2 (ICT) applicant must work for the overseas employer should be increased from 12 months to 24 months.  For the time being therefore, applicants under Tier 2 (ICT) only require to work for their overseas employer for a minimum of one year.

Immigration Skills Charge

One of the key recommendations of the MAC report was that an immigration skills charge be introduced for employers who wish to take on migrant workers.   It is the government’s intention to introduce such a charge at the rate of £1,000 in respect of all Tier 2 migrant workers.  The immigration skills charge will not be applied until April 2017, but will be a significant additional cost for employers to bear in the years to come.

Next Steps

The government’s intention in implementing these changes in two phases, autumn 2016 and April 2017, is to give employers the necessary time to prepare.  Nonetheless, the scope of the changes is significant and given that we are now in April 2016 with some of the changes only a few months’ away, employers will need to consider how these changes, particular in relation to the increased minimum salary costs and immigration skills charge will impact on their recruitment and employment of migrant workers.

Elise Lang