Wolfsdorf Rosenthal LLP

[UNITED KINGDOM] Various Developments Announced


Immigration Minister Announces Changes to Immigration Rules

On March 13, 2014, the Immigration Minister, James Brokenshire, announced the following changes to the Immigration Rules before Parliament:

  • The Exceptional Talent visa route will become available to leading talent in the digital technology sector, as Tech City UK will be added to the list of bodies that can endorse visa applications. Currently, the only bodies that can endorse individuals within this category are the Arts Council England, British Academy, Royal Academy of Engineering, and Royal Society. The exceptional talent category has an overall limit of 1,000 visas per year and 200 of these will be allocated to Tech City. 
  • A new category of overseas government sponsored language teachers will be introduced within the Tier 5 Government Authorised Exchange route, to enable teachers to share knowledge and awareness of foreign languages and cultures in the UK. Permission will be granted for up to 24 months, and the first of these schemes will support a Mandarin teaching scheme.
  • The ability for Sponsors to grant Tier 2 migrants five years’ leave has been added. This follows an earlier announcement on February 3, 2014, of the proposed fees for this application: £1,028 for overseas applicants and £1,202 for those applying in the UK.
  • A new visa regime for visitors from Venezuela will be implemented on May 5, 2014.
  • Minimum salary thresholds have been updated for occupations within the Tier 2 category. The Statement of Changes presented to Parliament. Details of the updated salary rates start on page 39.
  • Appropriate salary rates for Tier 2 have been increased. Details of the increases can be found on page 123 (page 8 of the Explanatory Memorandum at the end of the Statement of Changes, linked above).
  • The threshold for maintenance funds will be increased in line with increases in the costs associated with living in the UK. This will apply to student, worker, and family immigration applications effective July 1, 2014. As applicants need to have held the funds for 28 or 90 days, depending on the visa category, anyone planning to apply beginning in July is advised to ensure that sufficient funds are held in bank accounts from the end of March. The level of the new maintenance thresholds are set out in the Statement of Changes at pages 125-128 (pages 10-13 of the Explanatory Memorandum).

Unless otherwise stated and subject to any fine-tuning by Parliament, these changes are due to start on April 6, 2014.

Salary Rates For Tier 2 To Be Updated On April 6

On March 4, 2014, the Home Office announced that they intend to update on April 6, 2014, the salary rates in the codes of practice for skilled employees. At the same time, they will replace the following Standard Occupation Classification (SOC) codes with multiple options to correspond with the various job levels within those occupations, as set out in the codes of practice:

2123 Electrical engineers
2211 Medical practitioners
2213 Pharmacists
2219 Health professionals not elsewhere classified
2231 Nurses
2442 Social workers

From a practical perspective, the introduction of multiple options for the SOC codes listed above will not prevent Sponsors from assigning Certificates of Sponsorship (CoS) after April 6, based on Restricted CoS (RCoS) applications submitted before that date. However, the transition to the new salary rates means that the Home Office will adjust the arrangements for RCoS in April and May 2014 as follows:

  • Any RCoS granted before April 6, 2014, should be assigned by April 5, 2014. If not, Sponsors will need to ensure that the salary is in line with the revised salaries in the code of practice for the SOC code in question.
  • Rather than accepting RCoS applications from March 6 to April 5 to be decided on April 11, the Home Office will accept applications from April 6 to April 16, 2014, and decisions on these applications will be made on April 18, 2014.
  • Applications for the May allocation of RCoS will be accepted from April 17 to May 5 and the decision will be made on May 12. The monthly allocation process for June will revert to the usual schedule.
  • If an RCoS is required urgently between March 6 and April 16, an application must be submitted through SMS and exceptional consideration requested by email to Tier2Limits@homeoffice.gsi.gov.uk. This email must be sent to the Home Office on the same day as the application for an RCoS is submitted. 

Additional information includes:

Minimum salary thresholds:

Annual updates will be made to the absolute minimum salary thresholds for each Tier 2 category:

  • – Tier 2 (General) minimum rises from £20,300 to £20,500
  • – Tier 2 (ICT) Short-term staff, Skills Transfer, and Graduate trainee rises from £24,300 to £24,500
  • – Tier 2 (ICT) Long-term staff rises from £40,600 to £41,000

Standard Occupational Classification (SOC) code salary levels:

  • Appropriate salary rates for each SOC code have also individually been reviewed, with some increases and some decreases.

Resident Labour Market Test (RLMT)/Advertising:

  • Increases will be made to the salary thresholds with regard to advertising requirements under Tier 2 (General):
  • – The salary level at which a role is exempt from being advertised on Jobcentre Plus/Directgov rises from £71,000 to £71,600
  • – The “high earner” threshold at which a role is exempt from advertising rises from £152,100 to £153,500

Maintenance levels:

  • Maintenance amounts will increase beginning on July 1, 2014:
  • – Tier 1 (General) migrants extending in the UK will need to have held £945 for 90 days, up from £900.
  • – Tier 2 migrants will need £945 in maintenance and their dependents will need £630 in maintenance. Sponsors can continue to certify maintenance by confirming that they are happy to do so on the Certificate of Sponsorship.

Recommended actions:

  • Advertising carried out before April 6, 2014, in line with the rules in place at that time will continue to be acceptable. However, the salary listed on the Certificate of Sponsorship must be in line with the post-April 6, 2014, SOC code minimum if the visa application is made after that date.
  • “High earners” recruited before April 6, 2014, need only meet the pre-April 6, 2014, salary threshold of £152,100. Retain evidence that recruitment took place before April 6, 2014.
  • Inform migrants of new maintenance amounts; for example, any Tier 1 (General) migrants will need to have maintenance of £945 for themselves and £630 for each dependent for 90 continuous days if they plan to extend their stay after July 1, 2014.
  • Review relevant SOC codes and ensure that existing sponsored workers meet the potentially higher minimum “experienced worker” rate required for extension applications.

Migration Advisory Committee Releases Report on Tier 1 (Investor) Category

On February 25, 2014, the Migration Advisory Committee (MAC) published a much-anticipated report on the current investment thresholds and economic benefits of the Tier 1 (Investor) route. Commissioned by former Immigration Minister Mark Harper, the report synthesizes a large volume of data and offers a number of significant recommendations.

The MAC, a non-departmental public body sponsored by UK Visas and Immigration, is made up of experts in the fields of economics and migration and advises on questions of immigration posed by the government.

Tier 1 (Investor) Background

The predecessor to the present-day Tier 1 (Investor) category was launched in 1994 and required, as it does today, a minimum investment of £1 million. With the creation of the Points-Based System (PBS) in 2008, the government introduced the Tier 1 (Investor) route. Since then, the category has remained in large part unchanged except for a few amendments introduced in 2011, which accelerated settlement for investors of larger sums and reduced residency requirements.

At present, applicants must possess either £1 million, comprising the applicant’s own money, or £2 million in personal assets in addition to at least £1 million loaned to the applicant by a UK-regulated financial institution. In both cases, funds must be under the applicant’s control, held in a regulated financial institution, and disposable in the UK.

Individuals who meet the route’s requirements may be granted leave to enter the UK for up to three years. After that time, they may apply to extend their stay. To qualify for an extension, at least £750,000 of the funds must have been invested within a prescribed time frame in UK government bonds, share capital, or loan capital in active and trading UK-registered companies. The balance of the funds must have been used to either purchase assets or maintain a deposit in a UK-regulated financial institution.

After five years, investors may be eligible for settlement (also referred to as indefinite leave to remain) in the UK. However, individuals who meet the higher premium investment thresholds of £5 million or £10 million may benefit from accelerated settlement of three years and two years, respectively. After obtaining indefinite leave to remain, individuals who have invested £10 million or more may apply for citizenship after a total of five years, while all other investors are eligible after six years.

Report Recommendations

At the outset, the MAC noted its “healthy skepticism” about the economic benefits of the Tier 1 (Investor) route. The report asserted that many of the gains typically associated with the category might not be as self-evident as some would claim. Nevertheless, the MAC did acknowledge a modicum of economic benefit, albeit difficult to quantify, both to the British public as well as investors.

Based on these findings, as well as input from individual and organizational stakeholders, the MAC recommended:

1. raising the minimum threshold of investment from £1 million to £2 million;

2. relaxing present restrictions on permissible investment instruments and allowing greater flexibility and variety in investment alternatives. Potential options included:

  • relaxing reporting requirements to make investment in private companies more feasible;
  • permitting investment in extant investment opportunities such as venture capital schemes, and angel investments;
  • creating new investment instruments such as infrastructure bonds and property development;
  • combining investments such as pooled investments and a UK government business fund; and
  • offering philanthropic contributions such as education, arts, and medical research funds.

3. removing the “topping up” rule for investments, where investors must reinvest to maintain a prescribed balance. This would remove the incentive to purchase only low-risk UK government bonds, eliminate the need for quarterly valuations, and allow for more high-risk investments;

4. removing the ability to meet investment requirements by way of loans from UK financial institutions;

5. reducing the time individuals opting for the premium routes must be resident in the UK from 185 days to 90 days annually; and

6. capping the annual number of available premium investment visas at approximately 100 and offering them in a sealed bid auction. A reserve price would be set at £2.5 million with £2 million being investment and the balance being donated to the UK government for a good-causes fund.

In addition to these recommendations, the MAC noted several options that were outside of its responsibility, but that they believed would increase popularity of the Tier 1 (Investor) route and benefit the UK economy:

1. reducing the proportion of investment that may be made in UK government bonds, or prohibit investment in them altogether;

2. bringing dependent settlement periods in line with those for main applicants; and

3. accelerating citizenship for premium investors.

Pros and Cons

A number of the recommendations outlined in the MAC report represent constructive, reasonable steps that, if adopted, will benefit the UK economy and investors alike. Significantly broadening the scope of investment options, relaxing certain reporting obligations, and reducing residency requirements are all positive moves in the right direction.

Moreover, while falling short of actual recommendations, the MAC’s suggestions to bring dependents’ settlements in line with those of the main applicants and accelerating citizenship for top investors are sound proposals that the UK government should adopt.

On the other hand, some of the report’s recommendations could have negative effects. For example, raising the investment threshold from £1 million to £2 million could drive off a portion of investors who may be enticed by less costly schemes offered elsewhere. The UK’s investor route is already relatively expensive compared to those of other nations. While investors of the caliber attracted to the Tier 1 (Investor) route are concerned with more than just cost alone (e.g., stability of government, rule of law, and access to education), doubling the price of entry in one fell swoop will almost certainly act to drive down applicant numbers. And although we must avoid engaging in a race to the bottom with other nations, it is equally unwise to move in the other direction and price investor routes out of play in an increasingly competitive market.

Additionally, artificially capping the number of premium investment migrants at around 100 does not make for sound policy. The government has actively pursued the reduction of annual net migration numbers from the hundreds of thousands to the tens of thousands by 2015. But with successful Tier 1 (Investor) applications representing less than one percent of successful applications across all routes, such a measure, while perhaps appealing politically, will ultimately be meaningless numerically. Rather, the government should be actively drawing on its resources to attract as many new premium investors as possible, while simultaneously converting past applicants into higher levels of investment.

It should be noted that the MAC does not set policy and the recommendations in its report are not binding.

REPORT

Resignations: A Commentary

This government is committed to taking action to effectively tackle illegal working. Illegal working encourages illegal immigration, it undercuts legitimate businesses by illegal cost-cutting activity, and is often associated with exploitative behaviour like tax evasion and harmful working conditions.

  • – Immigration Minister Mark Harper

The circumstances under which Immigration Minister Mark Harper resigned are, to say the least, piquant.

Seven years ago, in 2007, he hired a housekeeper from South America. Although he allegedly requested and received documentation evidencing her permission to work in the UK, it recently came to light that these papers were invalid, and that he had in fact been employing an undocumented worker. Adding to the controversy, Mr. Harper was unable to produce copies of her paperwork to demonstrate that he had undertaken the prescribed status checks.

As a result, Mr. Harper submitted his letter of resignation on February 7, 2014, which was accepted by the Prime Minister.

Beyond the obvious irony that the Immigration Minister was forced from his post because he employed an undocumented worker, this resignation is particularly poignant in light of the new immigration bill that is wending its way through Parliament. In addition to doubling the maximum civil penalties for employers involved in hiring undocumented workers from £10,000 to £20,000, the new bill proposes to oblige banks, private landlords, and driver’s licensing authorities to perform mandatory immigration status checks before offering their services.

Cast in a harsh light, and borrowing from his own previous words, Mr. Harper’s transgression could be described as the type that “encourages illegal immigration” and “undercuts legitimate businesses.” More accurately, however, his actions should be seen as highlighting the onerous nature of the immigration bill’s proposed penalties and mandatory checks. Indeed, that the Immigration Minister was unable to follow the very employer protocols that he championed is a clear indication that they are deeply flawed.

Mr. Harper is not the first minister to resign under awkward circumstances.

Unsurprisingly, there is a storied history of ministers falling on their own swords.

In 2004, David Blunkett resigned as Home Secretary following allegations that he had expedited the visa of his ex-partner’s nanny. That same year, Beverly Hughes resigned from her post as the Minister for Immigration, Citizenship and Counter Terrorism after news emerged that she had been aware of fraudulent visa applications from Eastern Europe being granted.

Half a decade later, in 2009, Baroness Patricia Scotland was fined £5,000 and forced to issue an apology for unwittingly employing an irregular migrant as her housekeeper. While she purportedly obtained evidence of her employee’s permission to work in the UK, it turned out to be a forgery and she failed to keep copies of the paperwork. Fittingly, when she was a minister at the Home Office, Baroness Scotland had been instrumental in pushing legislation through the House of Lords requiring employers to request and retain copies of immigration status documentation. Despite the controversy, she was not asked, nor did she volunteer, to resign from her position as attorney general, as it was claimed that she did not “knowingly break the law.”

It is a truism, but unfortunately not always true, that those responsible for making and implementing policy should have a firm understanding of the areas with which they are charged. In Mr. Harper’s case, it is of obvious import that his employee deceived him. And while we do not expect our public officials to be superhuman, we do hold them to a higher standard. Accordingly, Mr. Harper resigned.

But the more pressing issue, indeed the one that suggests he was ill-equipped for the position in the first instance, was his inability to recognize at the outset that the immigration policies he promoted were, and continue to be, detrimental to immigrants, the general public and, as we have seen, the Immigration Minister.

To revel in Mr. Harper’s personal defeat would be callous and inappropriate. On the other hand, one cannot help but appreciate the equitably elegant manner in which his fall from bureaucratic grace neatly captured the onerous absurdity of the very policies that he espoused.

Following Mr. Harper’s resignation, James Brokenshire, the Conservative MP for Old Bexley and Sidcup, was appointed Minister for Immigration and Security.

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