Immigration cap means testing time for employers | 24 November 10
New restrictions on employing foreign workers could make life difficult for a range of companies and organisations, a leading law firm has warned.
Employment law experts at Ward Hadaway say that the announcement of the cap on the number of skilled workers allowed into the UK from outside Europe could hit a number of sectors in the region, particularly the IT and healthcare industries.
And the law firm warns that businesses and organisations which fall foul of the rules aimed at preventing illegal working face a range of penalties including substantial fines.
The Government has announced that from April next year the cap on the number of skilled workers allowed in to UK from outside the European Union will be 21,700 – about 6,300 lower than in 2009. A thousand of these will be people allowed in under a new “exceptional talent” route, such as scientists, academics and artists.
In a concession to the business community, who lobbied hard on this issue, the cap does not apply to employees of multi-national companies who are being transferred internally. However, there will be a new minimum salary of at least £40,000 for these employees, or £24,000 for if they will be in the UK for less than 12 months.
Employment lawyer Kunal Duggal from Ward Hadaway, who specialises in issues surrounding the employment of foreign nationals, said: “The overall effect will be around a 25% reduction in the number of foreign nationals allowed to work in the UK, something which could cause a serious headache to employers with find themselves unable to fill gaps in their workforce with workers from within the EU.
“Companies and organisations will find life much harder when it comes to recruiting non-EU nationals, and those who currently employ such individuals will find it harder to keep them on after April.”
Kunal said the sectors which could be most affected by the new restrictions include the IT industry and the healthcare sector.
He explained: “The IT sector will be hit by this because companies in the industry find it hard to recruit appropriately skilled and qualified people and have to look to source the right staff from abroad.
“The cap is also likely to have a significant impact on the NHS and private healthcare organisations, which rely on a large number of migrant workers in key roles in the delivery of patient care.”
Employers who fall foul of the regulations aimed at preventing illegal working can also expect to face action by the UK Borders Agency (UKBA).
Kunal explained: “Since 1997, all employers have been under an obligation to prevent illegal working and can still be prosecuted if they have ever employed someone illegally since that date.
“However in 2008 the law was changed, making it far easier for UKBA to issue employers with fines of up to £10,000 per illegal worker.
"There has been a significant crackdown since then which will no doubt continue in order to help the Government achieve its target of reducing net migration into the UK into the tens of thousands by the end of this parliament. ”
However, employers also need to steer a very careful course to ensure that their recruitment and retention policies do not fall foul of employment and anti-discrimination legislation.
Kunal said: “Employers still have to ensure they go through a fair process when dismissing someone who they no longer believe has or will have the right to work in the UK, otherwise they leave themselves open to an action for unfair dismissal.
“And an employer who adopts a policy of simply not considering or progressing applications from those who it believes may not have the right to work in the UK leaves itself open to a claim for race discrimination.”
Companies and organisations who wish to employ a skilled migrant worker must first obtain a licence from the Home Office to do so, and be able to demonstrate that they have been unable to recruit someone from within the EU for the job.
They should ensure they keep hold of all relevant documentation involved in the process in case of a challenge by UKBA.
Kunal Duggal said: “All of this makes it harder to employ foreign nationals, which is, after all, the stated aim of the Coalition Government.
"However, the long-term effects of this on the UK economy are difficult to predict.”
* Find out more about our specialist advice on immigration employment issues.