Whilst still coming to terms with the global pandemic, the retail and hospitality industry now faces a new challenge; adapting to the end of free movement for EU nationals and the introduction of the UK’s new immigration system.
The retail and hospitality industry employs a significant number of EU workers, and businesses across the country have relied on EU labour to meet their staffing needs. From 31 December 2020 free movement for EU nationals will come to an end. This means that EU nationals who move to the UK after 1 January 2021 must hold valid work visa permission under the Government’s new Points Based Immigration System to be able to work in the UK.
The work categories contained within the PBIS are based on a system of sponsorship. This means that an applicant must have a job offer from an employer who holds a valid sponsor licence. The job itself must meet certain skill and salary thresholds to be eligible for a visa. Under the new system, the salary threshold has been lowered for a skilled worker visa to £25,600 and the minimum skill level to RQF 3 (A Level or equivalent). Whilst this is positive news for some, it is still potentially out of reach for many employers within the retail and hospitality sector. Many employees are likely to be paid national minimum wage (or just above) and not all roles will meet the skills threshold. Visa applicants must also demonstrate good spoken and written knowledge of English language. Combine this with visa application fees that can add up to almost £10,000 (per person for a five-year visa), the new Skilled Worker route looks even more unattainable.
With only weeks to go until the new system is in place, the retail and hospitality industry will need to consider quickly how they can prepare. Our timeline set outs some important steps. It will be essential that your current EU staff know about the requirements to apply under the EU settlement scheme before 30 June 2021. You will need to consider if your business will need a sponsor licence, to ensure you have one in place from 1st January 2021. For those businesses who already hold a sponsor licence, you will need to think about the additional costs of sponsorship to ensure it is factored in when planning budgets. In the longer term, the retail and hospitality industry may need to give some thought to alternative recruitment strategies to ensure they are able to source labour now and into the future.
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