UK immigration rules

Published on 14th Apr 2015

The UK immigration rules allow a number of options for international businesses to establish a trading presence. Traditionally, a company has sent over an employee to scout the market or hired a local agent to establish the business platform. Once the company is ready to set up, it is worth taking some time to consider the options from an immigration perspective. There are three main routes to consider where the employee charged with setting up the UK business needs immigration permission to work in the UK:

  • Sole Representative
  • Tier 2
  • Tier 1

The choice will depend on a number of factors such as timing, demands of existing clients, the skill-set of the employee to be sent over etc. In essence however, the options have the following basic functions:

Sole Representative

An overseas business that has no established presence sends a senior employee to the UK to set up and run the UK operation. Note, having existing UK clients does not preclude this application. The initial visa is for three years and can be extended for a further two years. At the end of that period, the employee can apply to “settle” (stay permanently) in the UK. 

Tier 2

This is almost the mirror image of a Sole Representative. In this case, there must be an established and trading UK business. The business applies for a visa to have the overseas employee transfer to fill a vacancy. Not all Tier 2 visas lead to settlement, so if that is important, then this should be discussed at the outset. 

Tier 1: Entrepreneur or Investor

If neither of the above options suits, this visa is secured on the basis of the employee meeting the criteria – nothing is required from the Company and no existing UK clients/business is necessary. 

All three routes allow spouses/dependent children to accompany the employee and the spouse can work without needing any further permission. 

We would as part of our normal due diligence, look to see if any non-work permit route were available, and take into account the aims of the business and individual to ensure that the most appropriate application is made. Just looking at a single factor can create issues in the future that can be difficult to correct later. 

There has been a further round of changes to the Immigration Rules and the criteria to be met – as well as the introduction of a new Health Surcharge – the aim of which is to be seen to have overseas workers contribute to the cost of their using the UK health service. To stop this being too simple to deal with, not all visa categories are caught by this requirement. 

Of more significance – but less actual initial impact – is the staggered reintroduction of exit checks. This makes it much more likely for those visiting the UK for business (as opposed to having a work visa) to be monitored and tracked, meaning that for regular travelers who do not have permission to work in the UK, there is less chance of staying under the radar. 

In this round-up, we have summarized the changes which are likely to have the greatest impact on corporate employers. As the UK looks to attract skilled workers and investors from overseas, the UK government is seeking to ensure that the UK remains open for business – in the face of a UK General Election where the impact on migrant workers in the UK economy is being put at the front of most political campaigns

Changes to Tier 2

Tier 2 is the category that governs sponsored employment – “work permit” applications. Many of the changes are simply updating salary thresholds as per below. The Home Office is also increasing all applicable minimum salaries and thresholds for new Tier 2 applications (see below). Some job-specific salaries have also increased. In some cases, the increase in salary is as much as 15% which is significant when costing a secondment/transfer.

Category Salary (pre 6 April 2015) Salary (from 6 April 2015)
Tier 5 General jobs £20,500 £20,800
Tier 2 General jobs which are exempt from advertising in Jobcentre Plus £71,600 £72,500
Tier 2 General jobs which are exempt from the annual limit and the Resident Labour Market Test £155,500 £155,300
Tier 2 ICT Short Term Staff, Skills Transfer or Graduate Trainee categories (maximum stay either six months or one year) £24,500 £24,800
Tier 2 ICT Long Term Staff jobs (maximum stay five years) £41,000 £41,500
Jobs which qualify for Tier 2 ICT visas of up to nine years £153,500 £155,300

The new UK Government will be elected on May 7th. Given that the state of the economy (both local and global) has meant years of slow growth, tough choices needed to be made in respect of Government spending. When a country is coming out of a recession, the issue of immigration (workers, students, family members etc) becomes a headline issue. All of the main political parties are having to respond to a far-right political party (UKIP) that seeks to dramatically restrict the numbers of foreign nationals that can come to live, work and settle in the UK. All the parties need to appeal to the populist vote by being seen to be tough on immigration control, but all recognize the valuable contribution that foreign workers bring. 

So irrespective of which political party has power after the General Election, what can we expect? 

All of the political parties acknowledge that net migration (the balance between incoming and outgoing) is unsustainable at current rates. They do however differ on how best to address this. 

UKIP takes the hardest line with undertaking to treat European nationals the same as non-European nationals. Currently, there are no restrictions of the rights to move, work or live in the UK by a European national. Whether this is in fact feasible under international law is a moot point. Other than increasing staff numbers in the relevant government departments, the other main policy is to restrict the ability of migrant workers to claim UK Government benefits. 

The Conservative party have merely stated an aim to restrict the benefits that can be claimed as well as attempting to re-negotiate the “Freedom of Movement” rights currently enjoyed by European nationals. 

The Labour party and Liberal Democratic party have been even less specific, stating only that they will again restrict the rights to claim benefits and create more jobs within the relevant government departments. 

Immigration and the importance of overseas investment into the UK is of paramount importance and over the coming weeks will be a determining factor in forming the next UK government.

Interested in hearing more from Osborne Clarke?

* This article is current as of the date of its publication and does not necessarily reflect the present state of the law or relevant regulation.

Connect with one of our experts

Interested in hearing more from Osborne Clarke?