How the UK’s Statement of Changes Impacts Sponsor Licences

This is how the recent statement of changes to UK immigration rules impacts businesses using sponsor licences to hire international workers.

20 March 2024

Last year, the UK Home Secretary announced a five-point plan to reduce net migration. In response to this announcement, the Home Office has published the latest Statement of Changes, dated 14 March 2024.

This document provides essential information on how the proposed changes will be implemented and how they will affect businesses who use sponsor licences to hire from overseas.

The statement of changes at a glance

From 4 April 2024, new rules will apply to applications for entry clearance or permission to stay backed by a certificate of sponsorship.

Increased minimum general salary thresholds and ‘going rates’ for the Skilled Worker Route.
The new Immigration Salary List replaces the Shortage Occupation List.
Updated sponsor guidance regarding certificates of sponsorship.
New supplementary work allowances for Skilled Workers
Increased Family Route income requirements
Graduate Visa Route review.

Let’s explore these changes in greater depth.

Increased salary thresholds and ‘going rates’ for Skilled Workers

The minimum general salary threshold for the Skilled Worker route now sits at £38,700, up from £26,200.

According to the new rules, the “going rates” that determine the minimum salary for specific jobs will now be based on official data, rather than the 25th percentile of earnings. Consequently, the new going rate would be the higher rate shown in the 50th percentile, which is £15.88 per hour.

For those who are subject to transitional arrangements, the going rate would be the higher rate shown in the 25th percentile, which is £11.90 per hour.

Sponsoring employers must pay skilled workers at least the general salary threshold or the ‘going rate’ for the individual occupation, whichever is higher.

Exceptions apply to individuals who had a Skilled Worker permit prior to 4th April 2024 and have maintained continuous permission to reside in the UK. However, those who fall beneath the previous thresholds will be subject to them.

Individuals who hold a PhD or an undergraduate degree in a STEM field, new entrants (who are generally in the early stages of their careers) or individuals on the new Immigration Salary List (ISL) will continue to benefit from salary threshold discounts.

Changes to Other Work Routes

From 4 April 2024, several changes will be implemented across different work routes:

Global Business Mobility: Senior or Specialist Worker and UK Expansion Worker Routes

The general salary threshold for senior or specialist workers in the Global Business Mobility routes will increase from £45,800 to £48,500. In contrast, the going salary rates will continue to be based on the 25th percentile. The high earner threshold for these routes will remain at £73,900.

Transitional arrangements will be in place until 3 April 2030 for individuals who are already sponsored in these routes or make their initial application with a certificate of sponsorship assigned before 4 April 2024. These arrangements are similar to those for the Skilled Worker route, except that individuals in these routes cannot use them to change employers or settle.

Global Business Mobility: Graduate Trainee Route

For Graduate Trainees in the Global Business Mobility routes, the general salary threshold will increase from £24,220 to £25,410, with the going rates remaining based on 70% of the 25th percentile.

Scale-Up Route

For the Scale-Up route, the general salary threshold will increase from £34,600 to £36,300, now lower than the main Skilled Worker general threshold of £38,700.

Transitional arrangements are available for those whose certificate of sponsorship was assigned between 12 April 2023 and 3 April 2024. They will continue to be able to extend or settle, provided their salary is £34,600 or more per year.

Creative Worker Route

Creative workers in the UK must now demonstrate how they will contribute uniquely to the industry. The Home Office rejected the Migration Advisory Committee’s recommendation for a minimum salary threshold on this route, to prevent lower salaries than the Skilled Worker route

The Shortage Occupation List is out, the Immigration Salary List is in

According to the statement of changes, the Shortage Occupation List (SOL) for UK immigration is being replaced by the Immigration Salary List (ISL). The Migration Advisory Committee has determined the contents of the new list and will review it again in 2024.

Being on the ISL results in a 20% reduction in general salary thresholds, similar to the SOL.

The ISL is a government-approved list of 21 occupations, 18 of which are UK-wide and three specific to Scotland. It is intended to lower the minimum salary threshold to help fill labor gaps, but it is not an exhaustive list of all occupations facing worker shortages.

Some job roles now have a 20% lower salary threshold, which is either £30,960 or £23,200. The previous 20% discount to the going rate requirement has been removed.

The new ISL requires employment categories to meet current criteria. For post-Brexit UK, firms must note other regulations under the points-based immigration system, like an English proficiency requirement and confirmed job offers for foreign workers.

List of Recommended ISL Occupations

Managers and proprietors in forestry, fishing and related services
Laboratory technicians
Pharmaceutical technicians
Boat and ship builders and repairers
Stonemasons and related trades
Bricklayers
Roofers, roof tilers and slaters
Construction and building trades not elsewhere classified
Animal care services occupations not elsewhere classified
Care workers and home carers
Senior care workers
Chemical scientists
Biological scientists
Social and humanities scientists
Artists
Dancers and choreographers
Musicians
Arts officers, producers and directors
Graphic and multimedia designers
Welding trades
Carpenters and joiners

More supplementary employment opportunities for skilled workers

The statement of changes removes previous limitations on supplementary work.

Skilled workers can now start their own businesses, as long as they’re still meeting their obligations to their sponsoring employer. For example, a financial services sector worker can start a tech business on the side, provided they work outside their sponsored work hours.

To work beyond these restrictions, they will need a secondary sponsorship.

New financial requirements for family routes

The statement of changes has increased the financial thresholds for sponsoring partners and children in family immigration routes to match the minimum general salary threshold for skilled workers. The new minimum income requirement (MIR) is £29,000 annually. However, exceptions will be made in certain critical circumstances.

The revisions have come into effect for applications submitted on or after 11 April 2024. Transitional provisions are in place for those who have applied before the implementation of the increased financial thresholds.

Anticipated Review of the Graduate Route by 14 May 2024

The Graduate visa route was launched on July 1st, 2021. It lets international students stay in the UK without requiring sponsorship for 2-3 years after graduation to carry out a wide range of job roles.

The government wants to check if the Graduate route is achieving its objectives, which are:

Attracting and keeping high-achieving international students
Enhancing the reputation of UK higher education
Contributing to the UK’s education export targets
Helping businesses to recruit skilled international talent

Once the review is complete, the Home Office will evaluate the Migration Advisory Committee’s recommendations and may modify the Immigration Rules related to the Graduate route.

Some people worry that the government could decide to limit the use of the route further, for example, by only allowing graduates from specific institutions to apply. It’s also possible that the Graduate route could be stopped altogether, like the former Tier 1 route.

The Home Office has requested a quick report, which suggests that changes to the route could be made in the latter half of 2024, potentially during the mid-year or in the Autumn Immigration Rules update.

Implications of the statement of changes for employers

Employers in the UK will face increased costs due to the policies laid out in the statement of changes. The higher salary thresholds for foreign workers on the Skilled Worker route will make it more expensive for employers to hire them, unless they fall under one of the limited exceptions. This could mean that employers are unable to sponsor as many foreign nationals, potentially resulting in unfilled positions in the job market.

The Immigration Salary List (ISL) is now more restrictive than before, which means that fewer employers will benefit from a lower salary threshold. This could result in higher expenses for employers when they hire foreign nationals for jobs that no longer qualify for a discount.

The new requirements may also make it harder for certain family members to stay in the UK with their sponsoring partner or parent. This could deter some foreign nationals from seeking employment in the UK.

Depending on changes to the Immigration Rules, employers may have more restricted access to workers from the Graduate route. If the route is abolished, they may not have access at all.

Employers may need to reassess their talent pipelines to determine whether sponsoring student route workers directly after graduation is viable and desirable.

Employers need to stay informed and adapt their hiring strategies in response to these changes to ensure compliance and manage their talent needs effectively.

How can employers prepare for these immigration changes?

Given the impending restrictions and increased costs associated with the UK immigration system, employers should take proactive measures:

Review and assign Certificates of Sponsorship (CoS) before April 4 2024 deadline.
Stay informed about immigration rules and guidance.
Leverage increased flexibility offered to sponsored workers.
Encourage potential Family Visa applicants to apply before April 11 2024 to take advantage of lower income requirements.

By taking these steps, employers can better navigate the evolving immigration landscape and ensure they are well-prepared to meet the requirements of the statement of changes.