Brexit: Implications for Employers - Immigration
Following the referendum result there has been a lot of uncertainty for EEA nationals and their employers as to what their position is in the UK and what will happen when the UK exits the EU.
UK’S CURRENT POSITION AS A MEMBER OF THE EU
The UK is a member of the EU which consists of 28 member states. EU member states have free movement which means that nationals from one EU country can live and work in another country in the EU without requiring a visa (the only limitations are on Croatians taking employment in another EU member state for the first 12 months).
The EU is also part of the EEA which includes Norway, Iceland and Lichtenstein and these additional 3 countries also have rights of free movement. Switzerland, although not part of the EU or EEA, has a bilateral agreement with the EU which allows free movement. Effectively there are 32 countries that apply free movement.
Free movement principles will continue to apply until the UK formally leaves the EU. The UK can start proceedings to leave the EU by giving notice under Article 50 of the EU Treaty. Then there is a two year negotiation period, which could be extended even further with agreement of all 27 member states. The earliest the UK would leave the EU is therefore end of 2018.
EMPLOYING STAFF FROM EUROPE
Regardless of how long it takes to either invoke or not to invoke Article 50, a major concern is the question of what will happen to the right to employ European nationals. Most businesses rely heavily on European workers to meet their workforce needs.
When the UK exits the EU, in order to access the single market, the UK will need to either join the EEA and have a Norwegian style arrangement or a bilateral agreement with the EU like Switzerland. This should mean that the UK will keep free movement in some form, although the UK Government wants to restrict free movement as much as possible.
The UK may introduce measures to protect its borders to restrict the rights of free movement within the EU. If a work permit scheme is applied to all EU workers, it will be harder for many employers to recruit the staff they need.
PREPARING FOR BREXIT
Although there is some uncertainty about what the UK can negotiate with the EU there are certain steps employers can take now to protect the rights of their EEA employees working in the UK and the British employees working in the EEA.
HOW DOES THE VOTE AFFECT MY EEA NATIONALS WHO ARE CURRENTLY EMPLOYED AND THEIR RIGHT TO RESIDE AND WORK IN THE UK?
Bearing in mind that the UK has two years from when notice is given to formally exit the EU, the vote should have no immediate impact on your EEA nationals. After the exit the situation is not so clear and whether there would be immigration control. Employees who are eligible to apply for permanent residence or British citizenship should do so now.
WILL MY EEA NATIONAL EMPLOYEES BE REQUIRED TO LEAVE THE UK AFTER TWO YEARS?
Those EEA nationals who have confirmation of their permanent residence status in the UK should have the permanent right to reside and the UK must honour this status. EEA nationals who have resided in the UK for 6 years or more could also acquire British citizenship.
EEA nationals who have not reached the 5 year point when the UK exits the EU are in a vulnerable position. We expect transitional arrangements to be introduced to protect them and ensure that they can remain in the UK. It is possible some form of immigration controls could be introduced but these would be very difficult to administer.
WHAT ADVICE SHOULD I GIVE TO MY EEA NATIONAL EMPLOYEES WHO ARE CONCERNED ABOUT BREXIT?
Since the UK has up to two years to formally exit the EU, there will be little or no impact in the short term therefore it is business as usual for both employers and employees. However, we advise that for those EEA nationals who currently meet the requirements to apply for permanent residence and citizenship to apply as soon as possible. This will ensure that they are not affected by any changes to the Immigration Rules once the UK formally exits the EU. For those EEA employees who do not qualify for permanent residence or citizenship it is still a good idea to apply for confirmation that they are living and working lawfully in the UK under EU provisions. This confirmation of status is called an EEA Registration Certificate.
Our immigration team can come into your office to provide an ‘immigration drop in’ service for your EEA national employees. Please contact Rose Carey if this is of interest to you or your employees.
WHY SHOULD EEA NATIONAL EMPLOYEES APPLY FOR PERMANENT RESIDENCE OR CITIZENSHIP?
Permanent residence is confirmation that the EEA national has indefinite leave to remain in the UK and they are a permanent resident of the UK. It would be very difficult for the UK to go back on this status and so this means when the UK exits the EU the EEA national will be a permanent resident of the UK recognised under UK law. They will therefore not be subject to any immigration control on their right to reside and work in the UK.
It is also possible to acquire British citizenship through residence. The process is called ‘naturalisation’ and requires applicants to meet residency requirements. Taking British citizenship does not mean the place of domicile is changed so in terms of tax there are very few consequences. Most EEA countries allow for dual nationality as does the UK. However, some countries do restrict dual nationality e.g. Norway and the Netherlands so applicants should always check that they can acquire another nationality with their own national authorities.
WHAT IS THE DIFFERENCE BETWEEN PERMANENT RESIDENCE AND CITIZENSHIP?
Permanent residence allows the holder to stay permanently in the UK. The only way it can be lost is if the holder commits a serious offence (including deceiving the Home Office in an application) or leaves the UK and does not return for 2 years. Holders of permanent residence status cannot vote in most elections. However, they are entitled to NHS treatment and public funds.
Citizenship gives the holder the same rights as a permanent resident and in addition enables the holder to vote in UK elections and a citizen can leave the UK and not come back for a long period e.g. for 20 years and still be a citizen of the UK with the right to reside and work.
WHAT IS THE PROCESS FOR APPLYING FOR PERMANENT RESIDENCE AND CITIZENSHIP?
Applicants naturalising as British must now have evidence of their permanent residence status so in effect most EEA nationals will need to obtain permanent residence first even if they intend on making a citizenship application
Permanent residence is obtained when an EEA national resides in the UK for 5 years and exercises treaty rights e.g. as a worker. Absences must be no more than 6 months a year. The application is made to the Home Office on an application form which requires information about the applicant’s stay in the UK and details of how they have exercised treaty rights. The applicant must also enclose a lot of documentary evidence to support the application. Applicants for permanent residence can be backdated. For example if the EEA national moved to the UK in 2009 they could claim permanent residence in 2014. They would need to supply evidence for the period 2009-2014.
When the applicant has permanent residence they can apply to naturalise as British. Unless they are married to a British national they must have held the permanent residence status for 12 months. This is why it is advisable for permanent residence applicants to ask for their status to be backdated at least 12 months.
Applicants must meet the English requirements and knowledge of life in the UK. This will usually involve sitting an English language test and the Life in the UK Test.
The applicant must also show that they meet the residency requirements for citizenship which are no more than 450 days’ absence from the UK in the last 5 years and no more than 90 days’ absence in the last year. The Home Office can exercise discretion for absences in excess of these limits.
IF EMPLOYEES DO NOT QUALIFY YET FOR PERMANENT RESIDENCY OR CITIZENSHIP IS IT WORTH THEM APPLYING FOR THE EEA REGISTRATION CERTIFICATE?
Yes, it is advisable for EEA national employees to apply for this document. It confirms their status under EU law and that they have a right to reside and work without immigration control. When the UK exits the EU it makes it easier to show that they were exercising rights under EU law pre the exit and therefore should benefit from any transitional arrangements in place. Also, if the UK implements a cut off for when transitional arrangements will apply this will help show which group they are in. The Government has talked about introducing a cut off for possible transitional arrangements.
An application for the EEA Registration Certificate should also include evidence to show when the applicant first came to the UK e.g. if they moved to the UK and started work in 2014 the evidence should be supplied from this date so it is clear in Home Office records when they were first here.
AS AN EMPLOYER DO WE NEED TO DO ANYTHING IN RELATION TO RIGHT TO WORK CHECKS FOR EEA NATIONALS?
On the basis that the UK has up to two years to formally exit the EU, you are not required to do anything differently. You should be checking all employees’ right to work in the UK by seeing their original right to work documents and taking copies. For EEA nationals this would be the original passport or ID card.
EEA nationals come under List A documentation checks which means you only need check their documents once before their employment commences.
If the UK introduces immigration control after the exit then you will need to take advice nearer the time as to whether any of your EEA national employees will be subject to repeat right to work checks.
HOW CAN WE EMPLOY STAFF FROM THE EEA AFTER THE UK EXITS THE EU?
It is not clear at this stage what type of relationship the UK would have with the EU after the exit. We may be part of the EEA like Norway or have a bilateral agreement with the EU like Switzerland. The EEA and Switzerland have agreed to free movement so it is possible that not very much will change and we will keep free movement in place. The UK is keen to impose restrictions on free movement so it really depends on what can be agreed with the EU. The EU may agree to limited restrictions on free movement.
If there are restrictions on free movement then workers from the EEA may require a visa to work in the UK. It is unlikely visas will be required for short business trips. A work visa for EEA nationals could be a new system the Home Office creates or we could use the current Points Based System. The Points Based System enables employers to sponsor workers to work in the UK. This sponsorship requires the employer to be licensed with the Home Office to provide sponsorship and it is limited to professional skilled roles at a certain salary.
WHAT ABOUT BRITISH NATIONALS EMPLOYED IN THE EEA?
British citizens who are living and working in another EEA member state should be able to qualify for permanent residence in the same way an EEA national would qualify in the UK. The process will vary slightly from country to country but the principles are the same i.e. they must have exercised treaty rights for 5 years. It may also be possible for the British national to acquire nationality in that country based on their residence. Nationality law does differ from country to country and is not regulated by the UK but in most EEA countries it is usually possible to acquire citizenship after 5 or 6 years residency.
Those British nationals with ancestry of another EEA country might able to acquire a passport e.g. an Irish born grandparent.
Having permanent residency in another EEA member state would give rights to reside permanently in that country. To benefit fully from free movement people may need nationality of another EEA country.
News & Insights
Real Estate and Construction Newsletter – December 2017
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