With Labour’s recent landslide victory in the General Election, Harry Qiu Yu Yu, an associate in the immigration law team, provides an in-depth analysis of how Labour’s victory might shape the corporate immigration landscape for employers, following on from his earlier pre-election analysis of each party’s immigration policy and his commentary on Channel 4 news.
By contrast to the Conservatives and their hard-line immigration proposals, such as capping visa numbers, increasing salary thresholds/visa fees, etc., a Labour victory is generally positive news. However, the overall message from Labour remains that of reducing migration, albeit using different measures. This still carries far-reaching implications for employers.
Upskilling the UK to reduce reliance on overseas workers
Labour argues that the UK economy is too reliant on recruiting internationally and that stems from skills shortages in four key areas including health/social care, construction, engineering and IT. As such, Labour’s solution is to upskill UK workers to address the root cause of UK employers turning to overseas labour. To that end, Labour plans to issue ‘Workplace Plans’.
What are Workplace Plans?
Workplace Plans are essentially government-mandated training plans to upskill workers in skills shortage sectors. The Government will monitor the progress of the training plans and, if it is found that the sector is not engaging with the workplace plans, then the Home Office will remove the corresponding occupation from the Immigration Salary List (ISL). Labour also plans to prevent individual employers from sponsoring foreign workers if they are not doing enough to carry out workplace training.
What is ISL?
The ISL is a list of selected jobs eligible for the Skilled Worker visa, with a reduced salary threshold (i.e. an 80% discount to the standard required salary). Its purpose is to expand opportunities for skilled workers in selected occupations facing real skills shortages.
How might this affect employers?
Collective punishment across the sector
Individual employers may be collectively punished by cross-sector failures to train staff. The ISL is after all an important policy to many different sectors as the list currently includes jobs in the science, fishing, graphic design, pharmaceutical, artistic, agricultural, construction and care sectors. While individual employers may lack the ability to influence sector-wide training, they could be faced with removal of relevant ISL-listed roles if the sector as a whole does not engage with Labour’s workplace plans. Employers therefore need to assess this risk and consider taking immigration advice/building a back-up budget in case certain roles are suddenly removed from the ISL.
Training as a pre-condition to sponsorship
In addition to cross-sector measures, Labour’s plans also suggest individual ‘punishments’ against sponsors who fail to engage with workplace training plans i.e., preventing them from sponsoring. It’s unknown how the Home Office will implement this requirement, especially when the concept of training (unlike salary) is difficult to measure objectively. Below are examples of two potential scenarios:
(1) sponsor duty compliance-type requirement (i.e. the soft-touch possibility)
Sponsor licence holders already shoulder complex and numerous reporting, employee monitoring and record keeping duties. These are known as sponsor duties. The Home Office checks in on these sponsor duties via compliance audits which can be digital or in-person. The training requirement could be introduced as a potential addition to the already lengthy list of sponsor duties, much as many professions (solicitors included) are required by their regulators to keep records of continuing professional development (CPD). The Home Office could then carry out an audit to check that the training plans are being followed / carry out interviews to verify the genuineness of training. Failure to comply may then result in sponsor licence revocation or suspension. If this scenario were to be realised, then employers should take advice on how to properly comply with those additional sponsor duties and perhaps instruct immigration lawyers to conduct mock-audits on their business from time-to-time to ensure they are compliant with the new training duties.
(2) reintroduction of Resident Labour Market Test (RLMT) (i.e. the hard requirement possibility)
The second scenario, which is more worrying for employers, is that the training requirement becomes prescriptive and mandatory every time a sponsor issues a certificate of sponsorship. Prior to 2021, sponsors had to carry out a RLMT, which entailed keeping highly prescriptive evidence of advertisements/recruitment records showing that no UK-resident worker could fill the vacancy (lengthening the sponsorship process by 28 days), before a migrant worker could be sponsored. If the training requirement were to be implemented through a RLMT-like process, then employers may need to evidence efforts to first train staff for the vacancy or justify why that is not possible before sponsoring. This would lengthen the overall sponsorship process and add a myriad of additional costs to employers.
Tougher penalties for sponsors who breach employment/immigration law including lengthening sponsor licence bans and new powers to ban sponsors
This proposal already follows the current industry trend, where the Home Office is stepping up compliance visits to sponsors and generally being tough on employers who breach sponsor duties.
When it comes to ‘lengthening bans’, Labour is referring to the cooling-off period, where if a sponsor licence is revoked or surrendered (while the Home Office was taking compliance action), then sponsors cannot re-apply for a new licence within 12 months. Under the current rules, the cooling-off period is further lengthened if non-compliance is more severe, for example, up to five years if a sponsor has been issued with two or more civil penalties for employing an illegal worker or indefinitely if the sponsor has an unpaid civil penalty. However, in practice, where a licence revocation happens for a good reason, it can be difficult for the sponsor to re-apply even after the cooling-off period as the employer would need to address the previous revocation decision (i.e. usually a sponsor licence breach) before the Home Office would grant a new licence.
When it comes to ‘new powers’, the Home Office already has numerous grounds based on which they can ban sponsors. One only needs to look at recent sponsor licence case law to see an illustration of the Home Office’s wide-reaching powers to revoke (see a recent case-study article on sponsor licence revocation). It could therefore be possible that Labour is referring to other investigative powers which they may make available to the Home Office when carrying out compliance visits.
In light of the above, it is important for employers to make sure that they are compliant with their sponsor duties and to take advice if they need training or have any doubts on whether their existing HR files are compliant.
Reforming the points-based immigration system
Labour’s proposals also include a general promise to add appropriate restrictions to points based visas (i.e. work visas, student visas, etc.) in order to bring down net migration. Given that Labour’s overall message is that the Conservatives had failed in controlling immigration, one might think that Labour would consider revising the Conservatives’ host of immigration changes from Q4 2023 and Q2 2024, such as the increased Skilled Worker salary thresholds. However, Labour has made no promises of doing so and appears at this stage to only consider investigating the impact of those changes.
Harry Yu is an associate in the immigration law team, advising the full range of private client and corporate immigration law advice.
Get in touch
If you would like to speak with a member of the team you can contact our immigration law solicitors by email, by telephone on +44 (0)20 3826 7668 or complete our enquiry form below.
