Tackling Recruitment & Potential Racial Discrimination under the UK’s new Post-Brexit Immigration System

From 1 January 2021 free movement ends and the UK’s new Immigration System will apply to EU and non-EU nationals alike. Ahead of this the new Skilled Worker route launched on 1 December 2020 although EU, EEA & Swiss nationals do not become eligible until the end of free movement on 1 January.

The Skilled Worker route replaces Tier 2 General and it is different to its predecessor in a number of keys ways, which are both welcome to employers, but also potentially problematical at the same time.

Importantly, the Resident Labour Market Test (RLMT) has been abolished and the minimum overall skill level for roles eligible for sponsorship has been reduced from broadly degree level (RQF Level 6) to broadly A Level (RQF Level 3), thereby vastly increasing the number of roles in the UK that are now eligible for sponsorship.

The removal of the RLMT

The RLMT required employers to advertise a role in a strictly prescribed manner for a minimum of 28 days and, crucially, employers had to be able to show that no suitably qualified settled worker (UK, & EU nationals and those with permanent residency) could be found to fill the role at the end of the process, before sponsorship was possible. With the removal of the RLMT no such requirement to justify sponsorship now exists. 

What this means for UK employers & their recruitment practices

From an employment perspective, the basic principles haven’t changed: all employers need to ensure that those they recruit have the right to work in the UK. The ECHR Statutory Code of Practice makes clear that right to work checks should be carried out in the final stages of the recruitment process, not at the outset. This is because a policy of excluding those for whom a visa application would need to be made is potentially indirect discrimination under the Equality Act 2010 (the Act).

A consequence of the changes to the immigration system however is that lower skilled workers are now eligible for work visas, as far more roles are now available for sponsorship than in the past. This, combined with the abolition of the RLMT (which, as explained above, means that employers are no longer required to recruit from the settled workforce if a candidate is available) and the fact that EU, EEA & Swiss nationals seeking to come to the UK for the first time from 1 January to work will require a visa, could result in employers seeing many more applications from applicants who do not have the right to work in the UK than ever before and who will require sponsorship under the skilled worker visa route.

For those employers looking to target highly skilled workers from all over the world, this will now be easier to do. However, for employers who have sought not to incur visa costs, it is no longer an option to justify this approach on the basis that they are able (and previously required) to recruit a suitable candidate who has the right to work in the UK already, assuming one was available. Employers who have previously relied on the RLMT specifically not to recruit those who require a visa will need to adopt a different approach. Employers who typically recruit for roles not previously eligible for sponsorship may also now be forced to consider it. Finally, for existing employees requesting sponsorship on the basis they are in the UK under different visa category but that category is no longer tenable (for example if they are on a spousal visa but the relationship has broken down), or if they want to switch to the Skilled Worker route as it is a category that provides a route to permanent residence, in these instances, again, it will no longer be possible to refuse sponsorship on the basis that a suitable candidate from within the UK could be found to fill the role instead. 

Cost of sponsorship

Under the Act indirect discrimination claims can be defended if the policy adopted is objectively justified. Case law has established that costs alone will not be enough to justify such a policy, so the high visa and sponsorship costs alone, which can run into thousands of pounds, will not be a sufficient excuse. For some businesses however, there may be justification in assessing an annual total employment cost tipping point for the business. If the reason for limiting recruitment where visa costs will be incurred is to ensure the viability of the business, this may be permissible. Unfortunately it will not be clear where that tipping point is for a business and how extreme the consequences will need to be. Case law is likely to dictate how this area of law develops in the future.

What should employers be doing?

Key steps to take under the new immigration system are:

• Ensure right to work checks are made at the end of the recruitment process, and that there is no blanket approach to rejecting applications from those who require visas.
• Consider the salary on offer for the role. The overall minimum salary threshold under the Skilled Worker route is £25,600 (with some exceptions) and the salary must also meet the salary requirements or the ‘going rate’ for the relevant role, as specified by the Immigration Rules, if higher.  If the minimum salary requirements aren’t met, then employers will not be able to/ need to consider sponsorship for that role.
• For existing employees needing to be sponsored in order for their employment to be able to continue, consider if there are any other reasons to justify not sponsoring, such as poor performance.

This article was written by Emma Bartlett and Rose Carey. For more information, please contact Rose on +44 (0)20 7427 6524 or at rose.carey@crsblaw.com.