Update for UK Employers: Tiers 1 and 2 immigration limit

Tiers 1 and 2: General short term outlook

UK Employers needing to arrange work related visas for employees or potential employees over the next 1 to 2 years, look likely to face limits, obstacles, and potentially an ‘uphill struggle’. Interim limits are about to be imposed on tiers 1 and 2  (in place from 19th July) until April 2011, when more long term limits will be put in place.

The limits on Tier 2 (both before and after April 2011) do not apply to the transfer of overseas group employees (the Intra Company Transfer subcategory) but are likely to affect organisations wishing to extend the stay of existing work permit holders, and those bringing in “fresh hires” from outside off the EU. The interim limit is set to lead to a reduction in the number of Certificate of Sponsorship issued over the relevant period, by around 1300, around 5%. While this reduction may seem fairly small, the UK Border Agency appears to be already making preparations to help implement the limit. Indeed, there have been recent indications that the UKBA is keen to restrict the initial granting of Sponsor’s Licences. The longer term limit on Tier 2, to be implemented in April 2011, is sure to remain the subject of much speculation until much closer to that date.

Inevitably, where sponsorship under Tier 2 isn’t possible, businesses will be forced to explore other options for employees and potential employees, but they may also find themselves affected by the restrictions on Tier 1 (General). It isn’t completely clear at this stage whether the limit will directly affect the number of applications approved, or the number considered (A UKBA news article suggest there will be a limit on the number of applications considered) but there is expected be an upper limit of around 635 Tier 1 (General) approvals per month between August 2010 and March 2011. The current consultation and  in particular the recommendations of the Migration Advisory Committee will influence the longer term limit that is put in place in April 2011. There are no indications at this stage of what the level of the limit will be after this point.

We are advising all employers to plan well ahead where and if they have an anticipated need to sponsor staff under Tier 2, or help make alternative arrangements for someone under Tier 1. Employers should make their consultant aware of their requirements as early as possible, so that we can do everything possible to avoid our clients  being adversely affected by the limits.

Sponsor’s Licence Applications

We have been seeing examples of the UK Border Agency refusing Sponsor’s Licence applications based on stated reasons that appear to be incomprehensible and extremely pedantic.

In all cases the reasons given relate to supporting documentation, and the applications have included documents reliably deemed to be acceptable in the past by the UKBA. In all cases the explanations provided for refusal depend on the most unfavourable (and often unreasonable) possible interpretation of the published guidance. Some rejections we’ve witnessed include explanations based on new, never-previously-published requirements.

The approach being taken by caseworkers appears to lack reason, logic and consistency. It appears that the climate affecting the consideration of Sponsor Licence applications is extremely unfavourable.

It isn’t clear whether the UK Border Agency is under pressure to reduce the number of Sponsor Licence applications being approved in support of the planned limit for Tier 2.

We are taking an approach of conglomerating all of the explanations and information given by the UKBA lately relating to supporting documents for licence applications, and we are advising clients to take an ultra-cautious approach with new submissions and re-submissions of licence applications.