What is the new ‘Australian’ style points based system?
3 November 2020
During the referendum campaign along with ‘Get Brexit Done’ what we heard a lot of was the introduction of new ‘Australian’ style points based system which would only encourage the best talent in the world to come to the UK.
The term “new” was more of a political tool than anything else as it insinuated that once free movement ended the Government would introduce a system that would only allow people in to the UK if they were able to achieve points for various personal attributes such as age, qualifications and experience etc.
The reality is that we already have a points-based system that was introduced in 2008 called the ‘Points Based System’. This points-based system operates in tandem with a host of other non-points based routes.
The current Points Based System we have is split into various tiers.
Tier 1
The Tier 1 category has probably seen the most changes over the years and is for investors, entrepreneurs, highly skilled migrants and people with exceptional talent.
The Tier 1 (General) or Highly Skilled Migrant category which was discontinued in 2011 was perhaps the perfect embodiment of a points-based system. The category essentially allowed applicants to score points based on their education, earnings, experience and age etc.
Tier 2
The Tier 2 route is for skilled workers with job offers or for employees transferring from an overseas branch to a UK branch.
Tier 3
The Tier 3 route was envisaged for low skilled workers which never actually got implemented as it was thought that low skilled roles could be filled by workers from the EU. The Tier 3 route remains closed.
Tier 4
The Tier 4 route is for students who come to the UK to study at approved institutions
Tier 5
The Tier 5 route caters for temporary workers in various industries that usually require sponsorship from their employers. It covers sportspersons, dancers, entertainers, models, charity workers, religious workers amongst others.
The ‘new’ system focuses on making changes solely to the Tier 2 or skilled worker route.
Most other categories remain the same for now with minor changes to the rules and terminology.
The Tier 2 route or the skilled worker route, however, will see some significant changes (not enough to call it a new points based system), but significant in that the changes will make it easier for employers to sponsor foreign workers. What kind of checks and balances will be put in place to ensure that the system is not abused will have to be seen.
The key changes to the Tier 2/ skilled worker route include:
- Removal of the Resident Labour Market Test (RLMT)
Currently employers wishing to sponsor an employee from outside the EU must first advertise the position on two approved mediums (unless certain exemptions apply). Employers must confirm that they have been unable to fill the position advertised by a local worker.
The new rules will not place any such requirements on employers. They are free to choose who they wish to fill a vacancy.
- Lower skill threshold
Currently employers are only permitted to sponsor employees if the job in question has a minimum skill level equivalent to NQF level 6, unless the role falls within ‘The Shortage Occupation List’. NQF level 6 roles are considered graduate level and above roles. The Home Office have a published list of roles that they deem to be at this particular level and have minimum salary thresholds for those roles.
In the new rules, the good news moving forward is that, all positions that are at a skill level of NQF level 3 will be roles under which foreign employees can be sponsored. We already have a list of published roles that are considered to be at NQF level 3.
The Shortage Occupation List sets out jobs which are in short supply in the UK and therefore may need migrants to fill these positions. This list is constantly monitored and will continue to be monitored.
- Lower salary thresholds
Currently employers are required to pay a minimum salary of £30,000 per annum. In most cases the minimum salary payable for a particular role will be higher than the £30,000 per annum in any case.
In the new rules, the overall minimum salary payable has been reduced to £25,600 per year. There is further flexibility if the person that the employer wishes to sponsor is under 26 or switching from a student visa in which case the overall minimum is reduced to £20,480 which keeps it in line with average wages for graduates.
- No annual cap
Currently the Home Office has a cap on the number of people that can be sponsored under the skilled worker routes. Employers are required to request certificates of sponsorship in order to sponsor their workers and then usually have to wait to see if they fall within the monthly quota. This sometimes can mean delays in receiving a certificate of sponsorship if the limit has been reached in a particular month.
In the new rules, there will be no cap and employers will be given a certain number of certificates every year depending on their recruitment needs. Further certificates should be made available within 24 hours if they are needed.
These changes make it a lot easier for employers and businesses in all industries to ensure that they can continue to recruit the talent that they need.
If you or your organisation require employment advice please contact the Employment Team or your usual Wilsons contact.
