Is Tier 2 now obsolete? Ways to hire overseas talent in the current environment.
Recently, information about skilled workers being refused visas, businesses and NHS struggling to get the skills they need, abounds in the media. Businesses, especially the IT and technology sector that rely heavily on the overseas talent, have been beating the alarm for a while now. Things are becoming even more concerning, with evidence piling up that the UK is facing a bona fide skill shortage across most of the sectors. Unfortunately, there seems to be little interest from the government to offer solutions. With Brexit and cutting down immigration numbers being at the forefront of the government agenda, this particular issue seems to be too politically unattractive to divert resources into. Unfortunately, such populist approach might prove to be extremely damaging to the UK’s economy and its position as a leader in certain industry sectors. There is already an alarming sign that there is a brain-drain due to Brexit uncertainty, with a considerable number of highly-skilled EEA nationals leaving the country to build their careers elsewhere. The drop in number of EEA nationals coming to the country, adds further strain to the skill shortage. Furthering the crisis, it has now been the sixth consecutive month that the CoS limit for Tier 2 has been reached, meaning that many overseas candidates will not be recruited.
What is happening and what can be done about, are the most common questions I have to ask these days. Many of my clients even wonder whether there is any point to being a Tier 2 sponsor any more.
What is the current situation?
To address the first question, we need to have a quick look at the current rules and regulations around the sponsorship of a skilled migrants from the non-EEA countries.
Currently, to sponsor a non-EEA migrant, the sponsoring organisation must be a holder of a Sponsorship Licence. Apart from holding a Sponsorship Licence, the organisation wanting to hire overseas migrants needs to satisfy certain requirements. You can read more about those in the post here .
To sponsor a non-EEA migrant, the Sponsor Organisation needs to obtain and issue a CoS (Certificate of Sponsorship). There are two primary types of the CoSs, an unrestricted CoS and a restricted CoS. Most of the hires from overseas will require a restricted CoS. All those applying from abroad, unless their salary is going to be more than £159,600 per annum, will require a restricted CoS. Most of the non-EEA hires that can be done in country, will require an unrestricted CoS, unless it is a dependent of a Tier 4 (General) student switching in country.
The current issue flooding the media is, in fact, to do with the restricted CoS. While media is talking about visa refusals for skilled workers, the reality is, it is the refusal to issue a CoS, rather than the visa itself. As explained above, to sponsor a non-EEA worker from overseas, the Sponsor organisation needs to apply for a CoS first. The CoS is issued on basis of point scoring. This means that there are certain requirements and each has a number of points attached to it. There are two categories that points are available for – type of job, under this category at least 20 points need to be acquired and salary, which needs to score at least 1 point. Therefore, any application to have a chance of success, needs to score at least 21 points.
Another element to keep in mind with CoS applications is that there is an annual limit of all available restricted CoS’s. This is currently set at an annual limit of 20,700. This is then broken down into monthly allocations. As there will also be CoS issues outside of monthly allocations, the result is that as the year moves forward, the number of available CoSs decreases. For instance, March of 2018 saw CoS allocation numbers at 1000 (the year running from April 6th to April 5th the next year). with such a low number of allocations available and with the approach being that the higher scoring applications will get allocated first, the result is predictably that the lower the salary, the less the chances of success there are.
Thus, we arrived to the current situation, where the salaries below £50k-£55K, depending on the month, are not sufficient and the applications fail to score enough points to be successful. This is the reason that a large number of CoS applications are now being refused. Unfortunately, most of those being refused are precisely the sectors that the UK desperately needs skills in. For instance, according to data obtained by BBC (source here http://www.bbc.co.uk/news/science-environment-44113324) over 1800 healthcare professionals, out of which over 1500 medical practitioners were refused CoSs since this issue started in December 2017 and until March. IT and engineering, is another area heavily hit by these refusals, with another over 1500 professionals being refused CoS.
What is the reason for the current situation?
It is a combination of factors. Brexit and the drain of EEA professionals, who either leave the country or find the UK less attractive to migrate to. There is also the fact that certain Tier 2 (Intra-Company) transfer screams, such as Skills transfer or Short Term visa, have been closed. The organisations who used these routes to meet their skills requirements, are now forced to rely on the Tier 2 (General). Thus, the demand of Tier 2 (General) CoS have grown beyond what the current system can sustain.
What can be done?
Does this mean that the UK sponsors need to give up on overseas hires and look to fill their vacancies with the UK workforce, as some in the position of power seem to suggest? Considering that demonstrating incapability to hire locally is a pre-requirement for being able to sponsor an overseas worker, this is not a solution, but rather a blame game to transfer the responsibility for a failed situation generated by short-sighted policies onto businesses, rather than on the policy-makers themselves.
Then where do the solutions lie?
One obvious answer is that it lies with the policy-makers. If the government responds to the calls to either raise the yearly allocation cap or exclude the NHS and shortage occupation jobs from the allocation cap, things will likely go back to when getting a CoS was not an issue as long as the minimum salary threshold was met and the organisation either conducted a RLMT, or an exception applied.
This, however, is outside of the realm of influence of the businesses or at least most of the businesses, who simply do not have the clout to lobby for their interests. Of course all the businesses, whether through writing to their local MPs or through professional or industrial organisations they belong to, can contribute to the pressure of changing things. However, this is a long term solution and most businesses require a quick solution to a skills-shortage in their organisation, or they will face serious trouble.
I always advise my clients to look at all available options.
One obvious solution is to offer higher salary where this economically makes sense. Unfortunately, this is often not the case.
There are options that can maximise the chances of success in being allocated a CoS.
The points available for jobs that are on Shortage Occupation list are 130 as opposed to the jobs that are not on this list and merely had a RLMT conducted. However, the shortage occupation list is quite limited. I have had situations where the wrong identification of the tasks that the migrant was going to carry out or disregard to the specificity of the organisation had led to failure to identify that the job was, in fact, on a Shortage Occupation list. Identifying the correct SOC code can be challenging at times. I always recommend that legal advise is sought before the recruitment process broadens to include overseas candidates. This can save quite a lot in terms of financial resources and time that can otherwise be wasted on identifying and interviewing candidates that the business will never be able to hire.
New Graduate and Internship jobs
Another option is the route for hiring new graduate and internship jobs. This is less attractive, as it is only viable for those who are looking to hire entry level specialists and are able to show the specific type of recruitment process that was carried out to fill the position. Moreover, on the basis of the data available from the last allocation round (May 2018) the salary would need to be above £41K, which is rarely met for graduate level jobs, making this less attractive for smaller businesses.
The options that we discussed above fall under Tier 2 route. However, beyond those, there are also other solutions. None of these solutions is universal and legal advice should be sought to identify the best option for you.
Tier 5 (Youth Mobility)
For migrant who are aged 18 to 30 and who have either certain types of British Nationality or are citizens of specific countries, there is an option to be granted Tier 5 (Youth mobility visa) which will allow them to live and work in the UK for 2 years. The countries that are eligible for this route are:
- New Zealand
- Hong Kong
- Republic of Korea
Therefore, when recruitment procedure fails in the UK, making a concentrated effort of recruitment in the above countries as a first step, can at times provide the solution. Unfortunately, most of this countries are very well developed and face similar shortage of skills as does the UK. Therefore, it is not always and option.
Another option is the Ancestry route. This is a route for those who are citizens of Commonwealth and have a grandparent born in the UK. These people can qualify for a 5 year leave to remain in the UK which will allow them to work in this country. They will then qualify for Indefinite Leave to Remain. Ancestry route is one of the solutions I look at and have had several situations where the clients were able to avoid employing via the Tier 2 route, because the migrants were qualifying for this route instead.
In some circumstances the migrant’s family and private life relations to the UK may help securing a visa that will allow them to work in the UK. For instance, quite recently I helped a client secure a migrant worker, after they had failed to secure a CoS to sponsor shim, by looking at his family background and discovering that he had been in a long-term relationship with an EEA national, which qualified him for a leave to enter under the EEA Regulations.
Depending on the business and the level of the skill they look to recruit, some business visas may be more suitable than Tier 2. For instance, I had a situation where the client approached us to assist with hiring an overseas migrant for a upper-management position. The firm was a start-up and was reliant on the skill and as it turned out on the investment of the overseas migrant. Naturally, this was more suitable for a Tier 1 (Entrepreneur) route (read more here)
There is also the Tier 1 (Exceptional Talent) route, that while quite difficult to obtain due to high requirements, is suitable for certain situations and should never be overlooked on the basis of mere assumption.
There are numerous, less common, situations that might enable the business to hire an overseas worker and avoid going down the Tier 2 route. A full assessment should always be carried out by an experienced immigration specialist, who has a broader understanding of the available immigration routes. Only that way, a solution can be found. I always find that an early involvement of a legal adviser in immigration matters can pre-empt many issues that inevitably, will become more difficult to tackle after they arise. Seeking legal advice on time, is therefore a paramount .
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