The implications of Brexit for employers and their migrant workers

12th January 2017

The ‘leave’ vote on 23 June 2016 has far ranging implications for UK businesses but topping the list of employers’ headaches is the question of how Brexit will affect migrant workers already employed or likely to be needed in the future.

When will the UK leave the EU?

Extraction from the EU will take two years from the date the UK invokes Article 50.  However, to do so Parliament must first give their consent and we now await the ‘Brexit bill’ which is likely to face considerable opposition.

Why should UK businesses be concerned?

Unfortunately for British business, there is much to worry about, particularly for those businesses that rely on migrant workers to fill essential jobs in the hospitality, care and agricultural sectors.

Whilst the free movement rights of EEA nationals will not change until we formally exit the EU there is work to be done in retaining migrant workers, particularly those who may feel now that they are unwelcome and undervalued.  It is a difficult time to be an EU migrant in the UK no matter how dedicated or diligent

How can migrant workers protect their right to remain in the UK?

Many employers are reviewing their workforce to identify at an early stage whether Brexit could lead to gaps in their labour resources because the freedom of movement rules are removed or because the migrant workforce chooses not to return to the UK.  Employers concerned about this issue are offering their migrant workers assistance in establishing and cementing their rights of residence while it is still possible to do so.  Having recruited and trained those migrants, retaining them in employment for the long term is financially more beneficial than recruiting afresh, particularly in those sectors where employers have had difficulty in recruiting from the UK resident labour market.

As the status of EEA nationals has not yet changed, for those migrants currently living and working in the UK, the best way to secure their ongoing ability to remain in the UK is for their rights of residence to be formalised.  The first step is to apply for a registration certificate which can make it easier to prove a right to work in the UK and, if needed, to claim certain benefits and services.  Family members can also apply for a residence card in certain circumstances.

The next step is to apply for a permanent residence card.  Qualifying persons (ie those who are working, studying, self-employed, self-sufficient or looking for work) and who have lived in the UK for 5 years can apply for this card to prove their right to live in the UK permanently.  Family members can also apply.  In some cases, permanent residence can be confirmed after a shorter period of residence.

The registration certificate and permanent residence card can be obtained for a Home Office fee of £65.  Provided the eligibility requirements are met and the correct information and documentation is supplied when the applications are made, both processes are simple but can take up to 6 months.  The referendum vote will no doubt lead to a significant increase in applications for permanent residence and the processing times will increase.  The sensible course is to act quickly.

If the migrant wishes to remain in the UK permanently, the final step is to become naturalised, that is to apply for British citizenship.  In order to apply for British citizenship, the migrant must have a permanent residence card and must have held permanent residence for one year before applying as an EU citizen.  There are a few hurdles to be navigated including an assessment of the time spent absent from the UK; the need to pass the Life in the UK Test and an approved English Language Test (or hold an approved degree) and satisfy the Home Office that the migrant is of “good character”.  However, with a carefully prepared application the process is relatively straightforward.  Once the naturalisation certificate has been issued, the migrant can apply for a British passport.

Time is of the essence

Because of the increase in applications for registration and permanent residence, employers can greatly assist their migrant workers by advising them of their rights and the requirements to be met if they intend to remain in the UK.  Applications which are delayed until Article 50 has been invoked and the two year ‘notice period’ is in progress could be impacted if at the end of that period they have not been decided.   The consequences of delaying action may be severe if free movement is replaced by a new and more complex system of entry clearance which is a very real possibility.

The alternative view

Of course there is an alternative view that Brexit will ‘level the playing field’ for non-EU staff who currently have to satisfy the Home Office’s rigorous processes before any application for entry to the UK is granted.  However, we believe that priority will be given to the UK resident labour market, as currently applies with the inclusion of EU nationals benefitting from free movement.  Therefore the competition for UK jobs is likely to increase. If UK businesses can only recruit from outside the UK if they can demonstrate an inability to recruit from the resident labour market, those UK businesses may find that their payroll costs increase significantly and that our resident labour market drives payroll costs higher.

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