UK Inbound Practice, PBS – one year on
Nadine Goldfoot, Senior Manager & Solicitor, UK Inbound Practice, Fragomen LLP. Researched by Yunelsi Wray, Trainee Solicitor
It has been over one year since the UK’s new immigration system, the Points Based System (PBS) was introduced to regulate and monitor UK inbound practice and those seeking permission to work in the UK. Most employers have now got over the hurdle of applying for and obtaining a Sponsor Licence in order to be able to sponsor non-EEA nationals in the UK, but the challenges of UK inbound practice do not stop there.
One of the guiding principles behind the PBS is flexibility and the ability of the system to be adapted to meet the changing needs of the UK economy. True to form, over the past year or so, we have seen various changes to UK inbound practice introduced to the PBS, the latest of which were introduced on April 6, 2010. Many of these changes in UK inbound practice have been fuelled by recommendations from the Migration Advisory Committee (MAC), a group of independent economists who advise the government on migration issues. In response to the global economic downturn, the MAC was asked to investigate whether there was an economic case for restricting Tier 2 to shortage occupations only, the economic contribution made by the dependants of PBS migrants and to report on what further changes could be made to the criteria for Tier 1 (General), the highly skilled category.
The MAC concluded that “selective immigration that favours more skilled workers, as the PBS does, is vital to ensure that the UK continues to be thought of as a good place to do business, invest or study”1. They therefore recommend that Tier 2 should not be restricted to shortage occupations only. However, they highlighted that UK inbound practice must be tempered against concerns that immigrants are displacing or undercutting resident workers and provide a disincentive to up-skill the resident workforce. Their recommendations were therefore intended to ensure that such “displacement, undercutting or disincentive to up-skill [does] not occur”2
Key Changes
Resident Labour Market Test
Employers continue to be required to satisfy the Residence Labour Market Test (RLMT) for individuals who do not qualify as intra-company transfers or whose jobs are not on the shortage occupation list. This is done by providing evidence of a genuine attempt to fill the post with a “resident worker” (normally EEA nationals).
At the commencement of the PBS, the RLMT would have been complied with if the position was advertised for one week if the salary on offer was over £40,000, or two weeks if the salary was under £40,000. From December 14, 2009, the RLMT was extended to 28 days for all jobs to allow resident workers greater opportunities to apply. For employers, this means that they are required to wait until the four weeks of advertising are completed before proceeding with a sponsorship application. In practice this delay may affect the ability of employers to secure the best candidates if they are non-EEA nationals.
In addition, in April 2009 a new requirement was introduced to the RLMT whereby all vacancies have to be advertised in Jobcentre Plus and one other method of advertising permitted by the relevant code of practice. The only concession to this requirement was introduced later that year which exempted vacancies at director level carrying a salary of over £130,000 and milkround graduate recruitment from advertising on Jobcentre Plus. While these concessions were welcomed, the continued requirement to advertise in Jobcentre Plus for the majority of vacancies means that employers are not always attracting the most suitably qualified resident workers for the roles.
In-country Biometrics
From January 6, 2010, skilled workers and their dependants successfully applying to extend their stay under Tier 2 of the PBS will receive an Identity Card for Foreign Nationals (ICFN). This card will serve as evidence of their immigration status in the UK instead of a vignette in the applicants’ passports. To obtain the ICFN all applicants are now required to attend an appointment to enrol their biometric data (digital photograph and finger prints). The Public Enquiry Offices continue to accept Tier 2 applications for same-day service, but appointments for this expedited service are extremely limited. The majority of applications are therefore having to be filed by post. This means that applicants will be without their passports and unable to travel for extended periods while processing times continue to escalate, or alternatively return to their country of nationality or residence to submit an application at the British Consulate. In practice, employers and migrant workers find themselves in a position where further costs are being incurred due to the need to send the applicant overseas for filing to ensure expedited processing of these applications to facilitate the need for regular business travel.
Changes to UK inbound practice implemented from april 6, 2010
The changes to the PBS resulting from the MAC recommendations were introduced on April 6, 2010. These included the return to awarding points for Bachelor degrees under the Tier 1 (General). This was the case when Tier 1 was first introduced on June 30, 2008, but changed on March 31, 2009 to a minimum qualification level of Masters degree. Under the new changes, applicants with only a bachelor’s degree will be subject to a higher previous-earnings requirement. However, applicants with previous earnings of at least £150,000 or over will not require evidence of any qualifications.
Under Tier 2 of the PBS, the intra-company transfer route has been divided into three sub-categories: Established Staff, Graduate Trainees and Skills Transfers. The Established Staff route is the continuation of the intra-company transfer route as previously known but with an increase to a 12 month (from the previous six months) qualification period a foreign national must have worked for his or her sponsoring employer overseas in order to qualify. The purpose behind this increase is to ensure that the route allows only people with company-specific expertise to come to be transferred to the UK. As a result of this increase, employers may experience a detrimental effect on their ability to transfer assignees for time-specific projects or to meet contractual arrangements. However, as a result of a further MAC recommendation, this increase in qualification period may be mitigated to some extent by the introduction of two new sub-categories under the intra-company transfer route.
The first of these new sub-categories in UK inbound practice allows companies to transfer recent graduate recruits to the UK for the purpose of training and as part of a structure graduate training programme with clearly defined progression towards managerial or specialist roles within the company. The graduates will need a minimum three months overseas employment with the sponsor in order to qualify and will be able to come to the UK for a maximum of 12 months. However, sponsors are limited to transferring a maximum of five graduates per financial year under this sub-category. The second UK inbound practice sub-category allows companies to transfer foreign nationals to the UK to acquire the skills and knowledge needed to perform their roles overseas.
There is no minimum qualification period of employment overseas, but the maximum period of time they will be permitted to remain in the UK is six months. However, neither of these new sub-categories will permit employment in a permanent position nor act as an alternative to other Tier 2 employment categories. Migrants under these two new sub-categories will not be permitted to extend or switch immigration categories from within the UK and will need to return to their home countries on expiry of their visa. Furthermore, time spent in the UK under these two new sub-categories will not count towards the 12 months qualifying period for the intra-company transfer Established Staff route and equally, time spent in the UK under the Skills Transfer sub-category will not count towards the three months qualifying period for the Graduate Trainee sub-category.
In addition, the intra-company route no longer leads to eligibility for indefinite leave to remain (ILR) in the UK. For individuals who initially come to the UK under this route but intend to remain in the UK permanently, the clock will not start ticking on the five years residency required for ILR until they change to an immigration status that leads to ILR, for example Tier 2 (General) or Tier 1 (General). For employers, the prospect of ILR may be used as an incentive to encourage senior employees to remain in the UK role. In essence, employers who would like to transfer overseas employees to the UK on a permanent basis will have three options, complete the RLMT and sponsor them under Tier 2 (General), the applicant may qualify for Tier 1 (General) in their own right, or in limited circumstances the job may be on the Shortage Occupation list.
Conclusion
No doubt the UK’s economic recession during 2009 had a great impact on the newly implemented immigration system. Many of the changes above would have been conceived in response to that economic climate. Moving forward, the UK will undergo a general election, which may result in a change in government and therefore change in immigration policy.
However, the MAC believes that, “ideally, the PBS should act as an automatic stabiliser and should not be constantly adjusted in response to the economic cycle”3. Accordingly, the proposed changes set out above based on its recommendations are “designed to strengthen the PBS as an automatic stabiliser”4 and not force change in immigration policy as a knee-jerk reaction to change in the economic climate. Only experience of a further year of PBS will reveal the success of the MAC’s philosophy.
Fragomen is a highly regarded global immigration law firm providing comprehensive immigration services for international assignments, permanent transfers and high-net-worth individuals covering compliance policies and practices.
For more information on UK inbound practice, contact
Nadine Goldfoot, Senior Manager and Solicitor at:
Tel: +44 (0)20 3077 5150
E-mail: ngoldfoot@fragomen.com
References
1-4 Analysis of the Points Based System Tier 2 and dependants, Migration Advisory Committee, August 2009, page 1
The employer-employee relationship:
existence and meaning in US immigration law
By Charlotte Slocombe, US Attorney/Solicitor, Fragomen LLP London. Researched by Rachel Rosenfeld
As President Obama reaffirms his commitment to fixing the “US broken immigration system” all eyes are turned this year on comprehensive immigration reform to not only boost the economy, but correct some archaic and complex law. To date, only a big toe has been dipped into this never-ending battle between legal and illegal immigration – the distinction so often blurred.
Recent changes have not been pro-employer or employee, rather reinforcing the protectionist view of immigration. In January of this year, the United States Citizenship and Immigration Services (USCIS) issued a memorandum that set out guidelines for officials in determining the nature of the “employer-employee” relationship in the context of the H-1B visa and whether the petitioner truly has the “right to control” the beneficiary’s employment. The memorandum was issued with the specific purpose of attempting to clarify the eligibility for independent contractors, self-employed beneficiaries, and beneficiaries placed at third-party worksites under the H-1B umbrella. This has resulted in a far stricter view or labor for hire/staffing arrangements. The Master/Servant analogy of employment has therefore returned.
Immigration standards demand that the employee be linked to the employer throughout their duration of stay, and such categories of workers obscure this affiliation in the minds of many immigration officials. The commercial reality is that such contractual work is often at the heart of the specialized services the employer provides. Yet, such activities are often construed as a breakage in the employer-employee relationship, violating the terms of the proposed employment and thus deemed invalid from an immigration standpoint.
Adjudicators will increasingly demand contracts between clients and employer petitioner, with a statement of representation as to who has control of work. Approvals are set to be limited to the duration length of the contract, which will create a far greater need for extensions. Furthermore, Customs and Border Patrol (CBP) have further been questioning foreign nationals with approved H-1B petitions in an attempt to add another stopgap measure to the immigration process. In some cases, CBP officials reserve the right to detain returning H-1B visa holders and check their purported employment plans against previously filed petitions, with the potential upshot being that employees are literally turned away at the border if discrepancies are found.
Such measures are designed to ensure that foreign workers are introduced to the US in proper deference to the employer-employee relationship as outlined by the USCIS, despite this being a retroactive use of policy. A similar constriction has taken place in the adjudication of L-1B visas. Today, the focus of international employers is increasingly on trade and services rather than manufacturing and commodities. Employers are increasingly requiring the transference of workers whose knowledge is specialized in not as easily identifiable fields, such as information technology and consulting services.
As the definition of specialized knowledge thus broadens, it has become more difficult for immigration officials to pin down the exact nature of the employer-employee relationship, with the upshot being that L-1B petitions are increasingly subjected to greater scrutiny.
Employers thus must not only concern themselves with the terms of employment for their and their workers’ purposes, but also with the terms of employment for US immigration purposes. This reconciliation of business with immigration must take place before the employer hires new workers or transfers current ones with the misguided assumption that immigration clearance follows the lock-and-key hiring logic.
The employer-employee relationship must correspond with the realities of immigration and ultimately demands validation.
For more information,
contact Charlotte Slocombe,
US Attorney and UK Solicitor, at:
Tel: +44 (0)20 3077 5250
E-mail: cslocombe@fragomen.com
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