New government proposes tough immigration bill

27 May 15

UNITED KINGDOM

IMPACT – HIGH

What is the change? Newly re-elected Prime Minister David Cameron wasted little time in proposing a tough immigration bill that aims to stem immigration to the U.K. on several fronts, including “significantly reducing the level of economic migration from outside the EU” and limiting the number migrants from within the EU. In addition, today’s Queen’s Speech included plans for a bill to pave the way for an in/out referendum to decide Britain’s ongoing membership in the EU, potentially putting at risk the free movement of EU workers and their families into the U.K.

What does the change mean? Among the business-related proposals, the bill would reinforce the cap on non-EU skilled migration, require companies to transition foreign skills to British workers, make it illegal for employment agencies not to test the U.K. labor market before recruiting overseas, establish a new government enforcement agency to deal with abuse, and renegotiate EU membership to allow fewer European migrants into the U.K.

  • Implementation time frame: Ongoing. The full bill was unveiled today in the Queen’s Speech.
  • Visas/permits affected: While the proposals may affect conditions for all visa categories, those that limit foreign workers would primarily affect Tier 2 categories. Stricter English language testing would affect Tier 5 students.
  • Who is affected: U.K. companies and employment agencies that recruit foreign workers.
  • Business impact: The proposals call for tougher measures and increased costs for businesses that use foreign labor.
  • Next steps: If the bill passes, companies should prepare for a stricter immigration environment and greater limitations on hiring foreign workers.

Background: In a speech last week, Cameron outlined the immigration bill, saying it would “control” immigration and make the system “tougher, fairer and faster.” Today’s Queen’s Speech confirms the bill aims to root out illegal immigration and reduce the demand for skilled foreign labor while curbing abuse of low-skilled workers.

Of interest to the business community, the measures to reduce skilled foreign labor would have the government embark on a “massive skills drive” to train British citizens to transition into jobs currently occupied by foreign workers. The creation of 3 million apprenticeships would be financed by imposing a new visa levy on companies that employ foreign workers, Cameron said in the speech.

“We should be getting to a place where we only bring in workers from outside Europe where we have genuine skills shortages or require highly specialist experts,” Cameron said. “So sectors that have become over-reliant on migrant workers will be encouraged to train Brits instead. What’s more, we’ll make it illegal for employment agencies to recruit solely from abroad without advertising those jobs in Britain and in English.”

Other proposed provisions include establishing a new government enforcement agency to monitor companies and make sure they are paying minimum wages, conducting tougher English language testing of students, requiring banks to trace accounts of foreign visitors who do not have authorization to stay, mandating licensing of landlords, and tracking deportees by satellite.

BAL Analysis: Cameron’s Conservative Party remains committed to making good on its stated goal of reducing net immigration to the U.K. to “tens of thousands” of migrants. With a majority government, Cameron stands a good chance of passing an immigration bill and the EU referendum bill. If passed as is, the measures will significantly curtail immigration, including skilled categories, and add stricter rules for companies that rely on foreign workers.

This alert has been provided by the BAL Global Practice group in the United Kingdom. For additional information, please contact uk@balglobal.com.

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