In the last edition of Brand Matters, we reported on steps to take in relation to EU nationals in the UK in a No Deal scenario. Unless a deal or an extension is agreed, the UK will leave the EU on 31 October 2019 with no deal. Since our previous update, the government has released its policy for EU Nationals in the UK should there be a No Deal Brexit.
EU nationals living the UK before Brexit
Free Movement of people under EU laws allows for nationals of EU member states to move freely within the EU to live, work and study. After five years in the host member state, EU nationals are deemed as permanently resident in their host state and can apply for documentation to evidence this status if they wish, however, it is not mandatory.
The government has reiterated that EU nationals and their family members residing in the UK before 31 October 2019 will be entitled to remain in the UK on a course to permanent residency. However, it will be necessary to apply for documentation issued under UK laws to evidence their immigration status in the UK.
EU nationals and their family members already living in the UK before Brexit must make applications under the EU Settlement Scheme before 31 December 2020, otherwise they will be illegally in the UK, regardless of the length of time they have been in the UK.
If making the application after 31 October 2019, they may need to prove that they were resident in the UK before 31 October 2019.
EU nationals and their family members in the UK before Brexit must make applications for either Pre-Settled Status or Settled Status:
- Pre-Settled Status – This is for those who have been in the UK for fewer than five years. The Home Office will grant them Pre-Settled Status for a period of five years and they must apply for Settled status once they have been in the UK for five years or, in any event, before their Pre-Settled Status expires; or
- Settled Status – This is for those who have been in the UK for at least five years and is the equivalent of permanent residency. After holding Settled Status for one year, applicants may be eligible to apply for British citizenship if they meet the qualifying criteria for such an application.
EU nationals arriving in the UK after Brexit
EU nationals and their family members arriving in the UK after 31 October 2019 will be able to live, work and study in the UK until 31 December 2020 without having to apply for any documentation evidencing their status in the UK. However, it will be open to them to apply on a voluntary basis for a temporary immigration status called "European Temporary Leave to Remain" ("Euro TLR").
Euro TLR will give applicants a grant of leave to remain in the UK for three years. Applications for Euro TLR must be made by 31 December 2020. Before the applicant's three-year grant of leave under the Euro TLR comes to an end, EU nationals will need to apply for a visa to remain in the UK under the normal UK immigration rules, if there is an immigration category open to them. If there is no suitable visa category, the EU national and his or family members will need to leave the UK before the end of their Euro TLR leave.
Any time spent in the UK with Euro TLR will count towards a five-year qualifying period for permanent residency if the applicant moves onto grant of leave under the UK immigration rules which qualifies for permanent residency.
EU nationals arriving in the UK from 1 January 2021
EU nationals and their family members arriving in the UK from 1 January 2021 will require a visa under the UK immigration rules in place at the time. It is anticipated that the government will be introducing a new immigration system, although it is not clear whether this new system will be in place by 1 January 2021. It is not yet known what this new system will look like, but it is likely to be very similar to the point-based system already in place.
What do employers need to do?
The government has stated that until 1 January 2021 employers will not need to differentiate between EU nationals who have entered the UK pre-Brexit or post-Brexit. However, from 1 January 2021, it is likely that employers will need to hold evidence that workers have either pre-settled or settled status under the EU settlement scheme, Euro TLR leave or a visa under the UK's immigration rules. Any EU national or family member of an EU national who does not hold one of these status will be illegally in the UK and employing such a person will be an offence by the employer. This would expose the employer to a potential fine for illegal working (currently of up to £20,000 per illegal worker) and potentially a criminal prosecution as well.
To strengthen their position in the post-Brexit immigration landscape, employers should consider the following:
- Protect your business' position
Employers should conduct a full audit of their workers in the UK to identify employees who will need to obtain settled or pre-settled status under the EU Settlement Scheme or Euro TLR between now and 31 December 2020.
It is important to communicate the requirement to obtain the necessary status to their workforce and monitor when applications are being submitted. Employers should ensure they see any settled or pre-settled status documents as soon as the worker receives them and that copies are taken to keep on the worker's HR file as evidence of their right to work in the UK. Employers should keep a spreadsheet of who has obtained the correct documents and who has not. In this way, should any employee fail to obtain the necessary paperwork and a visa system be imposed, those who require a visa will be already known and the company will be well-placed to take immediate action to minimise any risk of illegal working.
- If the business does not have a Tier 2 sponsor licence yet, consider applying for one
It is not yet clear what the new immigration rules from 1 January 2021 will look like, but it is likely that to work in the UK, employees may require sponsorship by employers as per the current UK immigration system for non-EEA nationals. The current sponsorship system is known as "Tier 2" and employers who need to sponsor employees for visas must hold a Tier 2 Sponsor Licence.
It is unlikely that UK employers will be able to find all of the skilled talent that they require in the UK in the short term and a sponsor licence may become invaluable. Post-Brexit and post-31 December 2020, the application process for a Tier 2 sponsor licence may become protracted due to the number of companies making applications, leading to inevitable recruitment delays.
- What if the business already has a sponsor licence?
Businesses which already have a Tier 2 sponsor licence should consider their skilled labour needs in the medium-term. It may be that they need to apply for an increased certificate of sponsorship allowance to bring in foreign skilled labour. It is only likely to get more difficult in the future as the system gets more congested, so acting early may save difficulties later.