Despite the uncertainty surrounding Brexit, there are some steps employers can take now in order to retain their existing workforce in the UK.

Brexit has caused a lot of concern amongst EEA nationals and their employers as to what their position is in the UK and what will happen when the UK exits the EU, especially in the event of a “no deal”. This is clearly an important issue especially as sponsorship of overseas workers through the UK’s Points-Based System becomes increasingly expensive.

Importantly, free movement will continue to apply until the UK formally leaves the EU on the 29 March 2019 and, in the event of a deal, until the end of the transitional period.

Brexit with a Deal

In the event of a deal, under the draft Withdrawal Agreement currently being debated, the transitional period would run until 31 December 2020. Immigration control would only be imposed after this period ends i.e 1 January 2021. So there would continue to be free movement for EEA workers in the UK and British workers in the EEA after Brexit until the end of the transitional period. 

No Deal Brexit

In the event of a no deal there will be no agreement with the EU and immigration control could be brought in sooner. Realistically, in the event of a no deal the UK government is not ready to introduce a new immigration system for EEA workers and a transitional period on the UK’s side is still possible in terms of immigration control, but it is not clear when this would end and what the rights would be of EEA nationals entering the UK during this period. Also, the EU may not agree to a transitional period on its side in the event of a no deal and could impose immigration control on British nationals coming to the EEA for work after Brexit.

Current EEA employees

The UK Government has introduced a new EU Settlement Scheme for EU nationals who are currently resident in the UK to enable them and their family members to obtain status under the UK’s domestic immigration rules.  In the event of a “no deal” scenario, the government has confirmed that EU nationals resident in the UK before 29 March 2019 will still be able to apply for status under the scheme, as will their family members.

If the current Withdrawal Agreement is approved then the scheme will be extended to EU nationals and their family members who are resident in the UK before 31 December 2020.

It is important to note that the scheme only covers EU nationals currently, as separate agreements have to be reached with the governments of Norway, Iceland, Lichtenstein and Switzerland. It is expected that nationals of these countries will be able to participate in the scheme in due course.

Irish nationals

The UK and Ireland are part of the Common Travel Area, which pre-dates the UK’s membership of the EU. The rights of Irish citizens to live and work in the UK are not affected by Brexit in this regard and therefore Irish citizens do not need to apply for immigration status in the UK. However, any family members who are not British or Irish citizens will need to do so.

The Future

The Government released its new White Paper on 19 December 2018 setting out the new Immigration system post Brexit and has in the main accepted the recommendations set out in the Migration Advisory Committee’s September 2018 report.

The proposals include bringing EEA migration into the current Points Based System used for non-EEA workers. This would mean EEA workers will need a visa to work in the UK and only the skilled will be eligible. The existing Tier 2 scheme will undergo some changes, in particular the abolition of the annual cap and an extension to workers in medium-skilled roles.  There may be some visas available for lower skilled roles for up to one year. Visitors from the EEA will not need a visa for the UK.

Potential Issues with the New System

The proposals are controversial and will cause concern for many UK businesses.

The problem with the Points Based System is the time it takes to secure visas, the cost of providing these visas and the complexities of managing a system which places a lot of emphasis on self-management with a lack of support from UK immigration authorities.

In particular, costs may be an issue for smaller businesses. The cost of a Tier 2 visa will be prohibitive, especially for SMEs, and the lack of low skilled visas will be very problematic for certain sectors such as retail and hospitality.  The cost of a Tier 2 visa issued for 5 years is over £7,000. Small companies have a lower charge but even so for many businesses these fees will be untenable.

There are also question marks over exactly how many workers will be covered by the new system. A lower skill level will help, but there is a minimum salary level for Tier 2 which will mean many skilled roles will not qualify and employers outside London may struggle to meet the salary requirements. The new system could result in employers being unable to secure talented workers with unemployment at an all-time low in the UK and it will be harder for employers to recruit EEA workers following Brexit.

Action points

Very important

Employees should apply for permanent residence if they have lived and worked lawfully in the UK for a continuous period of 5 years (it may also be possible to apply if they have lived in the UK for 5 years but not worked for the full period).

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 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.  Employers should support employees making applications for permanent residence given that it remains unclear what will happen in a “no deal” situation and that any new system may be oversubscribed.

British citizens who are living and working in another EEA member state should also 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.

Some EU countries, such as Germany, do not allow dual nationality with a country outside the EU. If this is the case then those who would like to apply for British citizenship would need to make their application before Brexit and this should be urgently looked into as applicants must have proof of their permanent residence status first (see above)

Whether or not the UK decides to implement MAC’s recommendations, free movement is most likely to end when the UK leaves the EU. With this in mind, and a “no-deal” scenario looking increasingly possible, it is sensible for employers to consider how they plan to retain staff that are EEA migrants or prepare contingency plans for training more UK-born workers. This is something they should be thinking about now, rather than waiting for a new system to be established, given the amount of time developing a high-quality training system can take.

Employers’ concerns about a loss of talent are justified, but ahead of any decisive outcome they should aim to prepare their staff to the greatest extent possible and consider if they can bring forward staff relocations to the UK and Europe before 29 March 2019 if by the New Year there is no further clarity on whether there will be a deal.

Important

For employees who have not worked in the UK for 5 years, it is advisable for EEA national employees to apply for a document called an EEA Registration Certificate or register under the new EU Settlement Scheme. 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-exit and therefore would benefit from any transitional arrangements in place to enable those living in the UK before a certain date to continue without being subject to immigration control.

Also, if the UK implements a cut off for when transitional arrangements will end which might happen in a no deal scenario this will help show which group they are in.

They can also apply under the new ‘EU Settlement Scheme’ which is being rolled out by the UK government for EEA nationals living in the UK prior to Brexit (and assuming there is a transitional period those EEA nationals coming to the UK during this period can also register under the scheme). EEA nationals should keep records of their residence and work (or other economic activity) to make registering under the scheme easier. The Scheme is currently being tested as a pilot and should be fully rolled out by early next year.

Optional

It is possible for an EEA national to acquire British citizenship through residence. After they have held permanent resident status in the UK for a period of 12 months, they may apply to become a British citizen. The process is called ‘naturalisation’ and requires applicants to meet residency requirements.  Taking British citizenship does not mean the place of domicile is changed. If the EEA national wants to acquire British citizenship it is important when making their permanent residence application this is back dated if possible to a period that ends at least a year ago so they are deemed to have held permanent residence for 12 months.

It may also be possible for British nationals to acquire nationality in their EEA country of residence. Nationality law does differ from country to country 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 also able to acquire citizenship e.g. through a grandparent who was born in that country

Most EEA countries allow for dual nationality as does the UK. However, some countries do restrict dual nationality e.g. the Netherlands so applicants should always check first that they can acquire another nationality with their own national authorities.

For more information please contact Rose Carey.