From 1 January 2021 UK businesses employing EU nationals without settled or pre-settled status needed to meet the requirements of a new points-based system and obtain a sponsorship licence. The requirement aligns the EU-workers immigration and employment regime with that previously only applying to non-EU nationals.


Points-based system

Following Brexit, for EU nationals wishing to come and work in the UK, the prospective employer will need to be licensed. The points-based immigration system  and licensing regime requirements do not apply to EU nationals who already reside in the UK and have a settled or pre-settled status.


Settled and pre-settled status

Since the Brexit referendum, EU nationals already living and working in the UK by December 2020 have been required to apply to the EU Settlement Scheme and be granted a settled or pre-settled status to be allowed to stay and work in the UK. The deadline to apply is 30 June 2021.

The settled status is granted to EU nationals who can evidence that by the time they apply they have been in the UK for five years. Those who have not lived in the UK continuously for at least five years will usually get a pre-settled status. Subsequently, they are expected to apply for the settled status once they reach five years of residency.


Sponsorship licence for EU nationals

As part of the new licence application process the employer is responsible for verifying that the candidate has the necessary skills, qualifications or professional accreditations for the advertised job, and must keep relevant documentary evidence to that effect. Sponsorship licence conditions define the minimum rates of pay and skill required of prospective candidates. This is currently set at £25,600 or the ‘going rate’ for the job and skill level of RQF3 (Regulated Qualifications Framework Level 3). Candidates are required to speak English.

The employer organisation is required to appoint relevant sponsorship managers to oversee compliance with the licensing requirements. Key personnel must ensure relevant records and right to work checks are up to date, including notifying UK Visas and Immigration (UKVI) of any changes within the organisation or to the migrant’s employment status within a specified timeframe.

Sanctions for non-compliance include revoking the licence, fines up to £10,000 or prosecution.


How to apply 

Application for a sponsorship licence is online and must be accompanied by additional documents and evidence provided by post or email. Which documents are required depends on the type of organisation looking to employ overseas nationals.

The detailed list of documents can be accessed at Appendix A of the licensing guidance.  It is possible employers will get a pre-licence visit from a compliance officer from UKVI.


How long does it take to apply?

Licensing decision and approval is likely to take eight to ten weeks with possible delays due to Covid.


What to do now

Employers should look ahead to plan their hiring needs and apply for the licence in advance of the hiring process starting, allowing sufficient time for the process to run through and for the employer’s name to be included on the register of licensed sponsors. If help is needed with the application process, it is advisable to arrange a consultation with a OISC registered advisory organisation.

View more information about the sponsorship licence application process


Additional resources

Technical factsheet: freedom of movement to live and work in the EU or UK after the transition period

Technical factsheet: freedom of movement to study in the UK or EU after the transition period

This article has been shared from ACCA In Practice, to whom copyright belongs.  Whitefield Tax are an ACCA Member Firm