Sponsoring migrant workers from outside the European Union: Is raising the cap the way forward?

The Tier 2 (General) category is the main immigration route for UK employers seeking to recruit non EEA Skilled workers. It is subject to an annual limit of 20,700 places, divided into monthly allocations of certificates of sponsorship.

Over the last six months the scheme has been massively oversubscribed meaning that many employers have been disappointed not to be allocated a certificate of sponsorship.  As a result of the high demand for certificates, the minimum salary for non EEA Skilled workers has risen from £30,000 to effectively £50,000 – £60,000 per annum for any role. Employers paying less than the latter salaries have been refused a certificate. The Government announced that as from 6 July 2018, changes are being made to exempt doctors and nurses from the Tier 2 (General) limit, in response to pressures facing the NHS at this time. Whilst this will also be welcome news for other employers seeking to apply for a certificate of sponsorship, the pressure on certificates may take some months still to ease as employers previously disappointed may be applying again in the coming months. It may be time for the Government to consider raising the overall annual limit in any event to allow UK business to recruit the skilled workers that it needs.

Other non EEA Skilled Worker Changes

The Government is expanding the restriction on Tier 2 migrant workers holding no more than 10% of shares in their sponsor employer so as to restrict such ownership being held indirectly, such as via another corporate entity.

The rules on calculating a sponsored worker’s absences from the UK, for the purposes of settlement applications after 5 years in the UK have been clarified.

Right to Work Checks

The Government has updated its guidance on right to work checks.

Summary of Changes:

1. Steps employers should take, if in carrying out a right to work check, they consider a prospective employee presents information indicating they are a non-EEA national who has been a long- term lawful resident of the UK since before 1988 and does not possess acceptable right to work documentation;
2. Further clarification on appropriate steps for employers in relation to existing employees;
3. Clarification of the grace transfer period in cases of Transfer of Undertakings (Protection of Employment) transfers;
4. Ending restrictions on the employment of Croatian nationals with effect from 1 July 2018.

Interestingly, whether or not an employee had the right to work in the UK was the issue in dispute in the recent EAT case of Afzal v East London Pizza Ltd t/a Dominos Pizza.

Mr Afzal, who was from Pakistan, started working as a delivery driver in October 2009 and by August 2016 he was acting assistant manager and a manager in training. He was married to a European national and acquired time-limited leave to work in the UK, which expired on 12 August 2016. After that time, having been a permanent resident for five years, he had a right to apply for a document evidencing his right to permanent residence that would continue his right to work. He could not apply before 15 July but provided he applied by the expiry of the current leave, he was entitled to work while the application was considered.

The HR department wrote to Mr Afzal on 3 June and 15 July reminding him that he needed to provide the company with evidence that he had made an in-time application (which extended his right to work) and asked him to do this before 11 August. No evidence was sent until around 4.30 pm on 12 August when Mr Afzal sent an e mail with two attachments which contained the evidence of the application. However, Mr Afzal’s line manager could not open the attachments and he told Mr Afzal this.

As the company was concerned about possible fines/criminal sanctions for employing someone with no right to work in the UK and with no evidence that an in-time application had been made before the expiry of 12 August, it sent a letter of dismissal to Mr Afzal that day. No procedure was followed by the company prior to dismissal and Mr Afzal was not given the right of appeal. The reason for dismissal was “some other substantial reason”, in that the company believed that Mr Afzal’s employment was prohibited by statute. The Employment Tribunal held that the dismissal was fair on the basis that it was reasonable for the company to hold this belief and that it was reasonable for it to act decisively on 12 August because of its concerns about the risks of continuing to employ Mr Afzal especially because it had given him advance warning about the need to provide evidence of his in- time application. As for the failure to offer the right of appeal, the Employment Tribunal held that there was “nothing to appeal against”. The test which the company had to apply was whether before the date of the expiry of the permission it had reasonable grounds for believing that Mr Afzal had made a valid application for an extension. Once the date had passed, no new evidence would undermine the reasonableness of the belief that the company had on 12 August.

The EAT disagreed and held that whether a dismissal is unfair is to be judged on the whole process, including any right of appeal. Although the company had a genuine belief that Mr Afzal’s employment was prohibited by statute, that belief was wrong and with the application being made in time, the company was always entitled to employ Mr Afzal. If he had been given the right to appeal his dismissal and had produced evidence which showed he was entitled to work then the company could have rescinded the dismissal without any concerns about being prosecuted or fined. On that basis an appeal was not futile and the matter was remitted back to the same Employment Tribunal to consider the question of unfair dismissal and contributory fault.

Under the ACAS Code of Practice on Disciplinary and Grievance Procedures allowing an employee the right to appeal against any formal decision made is a key element of a fair procedure. Had an appeal been offered in this case and Mr Afzal given the opportunity to produce the relevant documentation the litigation could probably have been avoided.