On March 14, 2024, a significant change to the UK's immigration rules was released. The new rules came into force on April 4, 2024, impacting many employers and their workers who require sponsorship for a UK work visa.
For skilled workers whose Certificate of Sponsorship was assigned before April 4, 2024, and who have maintained continuity of permission as a skilled worker since then, transitional procedures are in effect until April 3, 2030.
What are the key changes to the rules?
Salary threshold increases
Importantly, several salary increase requirements will be implemented for applicants who qualify as Skilled Workers; some of these conditions will also apply to current visa holders as part of the transitional arrangement.
- General salary threshold increase: As reported in our previous newsletter, the general salary threshold has increased from £26,200 to £38,700 per annum.
- ‘Going Rates’ salary threshold increases: Salary thresholds that are occupation-specific or the ‘going rates’ to the median for each type of job role are also adjusted. The new standards have significantly increased, moving from the 25th percentile to the 50th percentile (median), with some exceptions for national pay scale occupations and health and care occupations not on a national pay scale. To provide equal compensation for all workers, many businesses may decide to re-evaluate their current salary ranges in light of the increase in the requirements for sponsored employees.
- Modifications to the going wage rates for national pay scale jobs and health and care occupations not on a national pay scale: These are consistent with the most recent data on the national pay scale and/or data from the Office for National Statistics (ONS).
- For those under the transitional arrangements: There will be a general threshold based on the 25th percentile; however, for those with a Certificate of Sponsorship assigned on or after April 4, 2024, the threshold rises to £29,000 per year from £26,200 to account for inflation.
- Changes for Senior or Specialist Employees in the Global Business Mobility routes: The most recent ONS pay data is being used to update going rates and amend the general salary threshold, which is being raised from £45,800 to £48,500 per year. Unlike the Skilled Worker route, guaranteed allowances and allowances for accommodation provided by the company (normally up to 30% of the total salary package) can be included in the salary figure to meet the minimum salary threshold.
Is the Shortage Occupation List being replaced?
Yes, according to the government’s Explanatory Memorandum, the Shortage Occupation List (SOL) is replaced with an Immigration Salary List (ISL) that includes positions for which "the government thinks it is sensible to offer a discounted salary threshold." There are just 21 occupations on the list, which is fewer than the previous Shortage Occupation List.
The list is reduced as a result of accounting for the higher wage threshold requirements for skilled workers that took effect on April 4, 2024, as well as the elimination of the 20% discount that was previously applied to job roles on the SOL.
Employers who sponsor employees for roles on the new ISL will primarily benefit from a reduced general salary threshold of £30,960 as opposed to £38,700. The going minimum rates, which must still be met and are being raised, will not be affected by the ISL reduction.
What impacts will the new occupational coding system have?
Additionally, the Office for National Statistics (ONS) 2020 Skills Occupational Codes (or "SOC") 2020 coding system is being used by the Home Office, superseding the ONS SOC 2010 coding system. As a result, some codes will need to be updated, and employers will need to reconsider their choices regarding which code is best in certain situations.
The wage ‘going rates’ will be raised from the 25th to the 50th percentile in addition to the new job types coding system. Employers will therefore need to evaluate each newly created and sponsored job function in light of the new salary level. Please contact us for information on new minimum salary rates for specific roles.
Will discounts for ‘New Entrants’ remain?
Yes, the Statement of Changes to the Immigration Rules confirms that the present pay reduction concession for new hires will remain in place beyond April 4, 2024. With a new level of £30,960 and £23,200 for healthcare roles, the general pay threshold for new entrants will be 20% lower than the general salary threshold.
A worker who depends on the new entrant threshold will still only be able to apply for a maximum stay of 4 years, which includes time spent in the UK as a graduate, skilled worker, or Tier 2 visa holder. Therefore, to extend their visa, new applicants must now be paid at the higher salary threshold.
How 3CS can help
For further information or help and advice with any business immigration matter, please get in touch with your usual 3CS contact.
