Key changes to Tier 2 from 6 April 2017

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Key changes to Tier 2 from 6 April 2017

Published 3 April 2017

Employers who hold sponsorship licences need to be alerted to the further key changes being introduced to Tier 2 from 6 April and this is in addition to those covered in our recent alert, which included details of the Immigration Skills Charge. These include:

Tier 2 (General)

  • The minimum salary threshold for high-earners (to be exempt from the resident labour market test – RLMT) will increase from £155,300 to £159,600.
  • For experienced workers the minimum salary threshold will increase from £25,000 to £30,000. The minimum threshold for new entrants will remain at £20,800.
  • For some jobs in the health and education sectors an exemption from the new salary threshold will remain until 01 July 2019. These include nurses, paramedics and secondary school teachers in certain subjects.
  • An exemption from the RLMT and from the annual limit for posts that support the relocation of a high value business to the UK or a significant new inward investment project.
  • A widening of the advertising methods to satisfy the RLMT for graduate recruitment.
  • Changes to provide greater clarity and consistency as to which types of allowances will be considered against the salary requirement.

Tier 2 (Intra-company Transfers)

  • Short Term Staff – Closure of the category meaning that it will not be possible to bring in ICT employees for up to 12 months from 06 April 2017 unless they qualify in the Graduate Trainee category. Certificates of Sponsorship (CoS) issued before this date will continue to facilitate applications.
  • Long Term Staff – Reduction of the high-earners' salary for the category from £155,300 to £120,000 making it possible for more employees to extend their stay up to the maximum of nine years. However, retention of the minimum salary level at £41,500.
  • Minimum length of group employment - For those ICT employees paid £73,900 or above removing the requirement to have at least one year's employment with a linked overseas entity.
  • Extension of the Immigration Health Surcharge - £200 per year will also apply to ICT employees and their dependants.

Updates to the Tier 2 shortage occupation list (SOL) and codes of practice

  • Being added to the SOL are secondary school teachers in combined science, computer science and Mandarin.
  • Being removed from the SOL are secondary school teachers in chemistry.
  • Annual updates to the occupational salary rates in the codes of practice.

It is expected that new versions of the guidance documents will be available from the GOV.UK website on 06 April 2017.

What does this mean for employers?

Although there are some positive changes in terms of compliance with the RLMT, removal of qualifying employment and the reduction in high earners' salary threshold for the ICT category, on the whole employers are going to find the changes will inhibit their ability to bring non-EU nationals into the UK and increase their recruitment costs. In particular, with the changes to the ICT route, employers will struggle to find routes into the UK for short term assignments or more junior positions and are going to have to either increase salary levels to meet the Long Term ICT category or rely on the very restrictive Visitors visa category.

Practical tips:

Payment of Immigration Skills Charge – This is payable by debit or credit card only. Employers and applicants are advised to make arrangements with their bank to ensure the card transaction limit is sufficient. This is particularly relevant for employers assigning a large number of CoS at one time or large family groups applying together. It is important to note that CoS will be considered invalid (leading to application refusal) if any charge that applies is not paid in full.

Priority Change of Circumstances – For a £200 processing fee the following sponsorship licence actions will be considered within 5 working days as opposed to the 18 weeks service standard: a) in-year CoS increase; b) follow-on CoS allocation; c) add a new level 1 user; d) replace an authorising officer.

Premium Service Centre (PSC) – Dedicated to Tier 2 and 5 applications, a PSC is now in operation in (Victoria) Central London.


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