Closure of Tier 2 Intra-Company Transferee (Short Term) Category, Minimum Salary Modifications Among April 6 Changes

United Kingdom

New rules effective April 6, 2017 will include the closure of the Tier 2 Intra-Company Transferee (ICT) (Short Term Staff) category, changes to salary thresholds and relaxed graduate recruitment provisions. As expected, the Immigration Health Levy is to be extended across all Tier 2 ICT categories and an Immigration Skills Charge will be introduced for most new Tier 2 applications.

The new rules are explained in detail below.

Tier 2 Intra-Company Transfer Category

The Tier 2 Intra-Company Transfer category will be reduced to the following two sub-categories from four:

• Long Term Staff – for those with a minimum salary of GBP 41,500 or those who meet the Standard Occupational Code (SOC) minimum; and
• Graduate Trainee – for those with a minimum salary of GBP 23,000 or those who meet the SOC minimum.

Other changes include the following:

• The salary threshold to avoid the 12-month cooling-off period for Tier 2 ICT will be reduced to GBP 120,000 from GBP 155,300.
• The salary threshold to remain in the United Kingdom for nine years under Tier 2 ICT will be reduced to GBP 120,000 from GBP 155,300.
• Tier 2 ICT migrants earning over GBP 73,900 will be exempt from the requirement to have at least 12 months’ employment experience.
• The government clarified what does and does not count toward allowances. Notably, employers will have to pay assignees guaranteed annual payments to cover mobility or cost of living in the United Kingdom.
• An Immigration Health Levy of GBP 200 per applicant per year will apply to all Tier 2 ICT migrants and their dependants.

Tier 2 General – Salary Changes

The key changes that will affect salaries for workers in the Tier 2 General category include the following:

• The minimum salary will increase to GBP 30,000;
• The High Earner threshold (where no Resident Labour Market Test is required) will be increased to GBP 159,600;
• What does and does not count toward allowances has been clarified. Employers must pay guaranteed allowances for the duration of the applicant’s employment in the United Kingdom, which must match what would be paid to a local settled worker in similar circumstances; and
• Applications on or after April 6, 2022 for Indefinite Leave to Remain based on residence as a Tier 2 General migrant will require a minimum salary of GBP 37,900.

Tier 2 General – Recruiting Practices

Employers will be able to advertise on at least one prominent graduate recruitment website which does not charge a fee to jobseekers to view job advertisements or to apply for jobs via those advertisements. Employers will no longer be required to advertise on specific commercial websites such as Target Jobs or to use the milkround recruitment method.

Employers will be required to make an offer to graduates within 12 months of the end of the recruitment exercise, up from six months.

The salary threshold for employers who are exempt from advertising on Universal Jobmatch will be increased to GBP 73,900.

Immigration Skills Charge

• An Immigration Skills Charge will be introduced for foreign nationals who apply for a stay over six months in the Tier 2 General and ICT categories at a rate of GBP 1,000 per year.
• There will be exemptions for Tier 4 to Tier 2 switches, Tier 2 ICT Graduate Trainee and PhD roles.
• Small and charitable sponsors will be subject to a lower charge of GBP 364.

Criminal Record Certificates

Tier 1 Investor, Tier 1 Entrepreneur and certain Tier 2 General SOC code employees (in medical and educational roles) will be required to obtain a Criminal Record Certificate from the relevant authority in any country in which they have resided for 12 months or more (whether continuously or in total) in the past 10 years while age 18 or over.

The Home Office will allow waivers of this requirement in certain circumstances.

Tier 1 Entrepreneur

The government has clarified the following points about Tier 1 Entrepreneurs:

• They will be able to become members of a Partnership to retain eligibility.
• ‘Investment’ means that the funds have been invested into a business or businesses in which the applicant is self-employed or is a director or member of a partnership.

Tier 1 Exceptional Talent

There will be minor changes to Arts Council England criteria, and major changes to Tech Nation criteria, with separate criteria for those applying under the Exceptional Talent and Exceptional Promise categories.

Representative of an Overseas Business

The rules clarify that a UK branch of an overseas business can already be in existence but must not be active to qualify for the visa.

Inward Investment Companies

The Home Office has confirmed the definition of an Inward Investment Company and indicated that the Resident Labour Market Test will not apply to companies that meet the following requirements:

• The sponsor was registered in the United Kingdom with Companies House no earlier than three years before the date the Certificate of Sponsorship was assigned;
• The sponsor is the registered branch or wholly-owned subsidiary of a business which has its headquarters and principal place of business outside the United Kingdom;
• The relocation or inward investment involves new capital expenditure of GBP 27 million or the creation of at least 21 new UK jobs; and
• The sponsor can provide evidence of the above points, if required. For this purpose, working in support of an inward investment project does not include the supply of services to a third-party client.

Other Changes

Applications will be refused if a migrant has overstayed a visa in the United Kingdom for 30 days or more and leaves voluntarily. This is a reduction from the current more generous 90 days’ allowance, where transitional arrangements are in place.

The Home Office will grant 10 business days for applicants to provide additional documents for their visa applications where requested, an increase from seven business days.

Passports will no longer have to be current to meet English language requirements, as required by certain visa categories.

What This Means for Employers and Foreign Nationals

These changes will result in a substantial increase in the cost of obtaining permission to work in the United Kingdom due to the introduction of the Immigration Skills Charge, the extension of the Health Levy to Tier 2 ICT category and the elimination of the Tier ICT Short Term Staff category.

Foreign nationals should, however, benefit from the introduction of a lower threshold for the cooling-off period for the Tier 2 ICT category and the relaxation of the graduate recruitment rules.

This alert is for informational purposes only. If you have any questions, please contact the global immigration professional with whom you work at Fragomen or send an email to [email protected].

© 2017 Fragomen, Del Rey, Bernsen & Loewy, LLP, Fragomen Global LLP and affiliates. All Rights Reserved.