Economic migration and salary thresholds: could an Australian-style points based system work in the UK?

The Migration Advisory Committee (“MAC”) has published its review of salary thresholds for economic migration and how an “Australian-style” Points Based System (“PBS”) could work in the UK.

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Immigration
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News

The MAC’s review of how salary thresholds are calculated for Tier 2 applicants was initially commissioned by Theresa May’s government in June 2019. Subsequently, in September 2019, Boris Johnson’s government asked the MAC to also consider how points could be awarded to prospective migrants under an “Australian-style” PBS.

The key recommendations made are listed below. To summarise, the MAC has recommended retaining the overall structure of the Tier 2 (General) route, which currently allows employers to sponsor individuals with a job offer from outside of the EEA to fill vacancies in the UK. However, alongside this, the MAC has recommended some changes to the route which would lower the minimum skill level and minimum salary thresholds, opening the route to individuals carrying out medium-skilled work.

While individuals currently score “points” for meeting certain requirements under Tier 2 (General) (including minimum skill and salary), the MAC highlights that these are effectively meaningless as they are not tradeable. In other words, individuals have to score points in specific areas in order to be eligible and cannot make up for a lack of skill, for instance, with a higher level of English language. As a result, the MAC concludes that the existing points under Tier 2 “serve no purpose” so could be removed; although they do no harm either.

For individuals without a job offer wishing to enter the UK labour market based on skills only, the MAC recommends expanding the Tier 1 (Exceptional Talent) route, as it currently “does not work well”. The MAC considers that the skills bar for entry is “set far too high” and the route is currently “too narrow” to cater for the array of highly skilled migrants who may wish to come to the UK without a job offer post-Brexit. The report outlines how the Tier 1 (Exceptional Talent) category could be turned into a PBS route which ranks applicants based on those who have the highest number of points. These would be tradeable points which could be scored based on characteristics the government finds desirable.

This timing of this recommendation is particularly interesting, given that the government has today published details of the new Global Talent visa, which is intended to replace the Tier 1 (Exceptional Talent) visa on 20 February 2020. The Global Talent category will not be subject to a cap, applications may be fast tracked with minimal evidence and there will be accelerated settlement options after 3 years for those endorsed by the bodies responsible for science, engineering, humanities and medicine. However, these reforms do not appear to lower the bar on the high skill level required.

Key recommendations

The key recommendations made by the MAC include:

For those with a job offer:

  • Recommends retaining the existing framework for Tier 2 (General)
  • Recommends expansion of Tier 2 (General) to include jobs skilled to RQF level 3 and above (medium-skill level and above)
  • Recommends reduction of minimum salary threshold from £30,000 to around £25,600 (based on 2019 figures) for Tier 2 (General) migrants
  • Rejects regional minimum salary thresholds, but recommends evaluating a potential separate pilot visa for “remote” areas of the UK which could include lower salary thresholds
  • Rejects pro-rating salary thresholds for part-time work, but recommends that the government considers this for visa holders switching to part-time work after becoming a parent
  • Recommends a review of whether the Shortage Occupation List is needed after the new immigration system has been introduced

For those without a job offer:

  • Recommends expanding Tier 1 (Exceptional Talent) to cater to a wider pool of talent by:
    • Having an overall annual cap
    • Operating on an “expression of interest basis” where individuals register their interest with the government and this creates a pool of applicants
    • Having a monthly draw from the pool of applicants based on those with the highest number of points, which would be tradeable and scored based on certain criteria. Those selected are invited to apply.
    • Having a minimum number of points
    • Awarding points for characteristics that the government wants to attract and for whom other routes are not suitable
    • Considering some of the following as potential characteristics for awarding points: Qualifications with a rigorous process to assess the quality of qualifications and not just the level; Age; Extra points for having studied in the UK; Priority areas such as STEM and creative skills.

Settlement:

  • Recommends an immediate pause in planned increases to the minimum salary requirement for settlement under the Tier 2 (General) route.

Conclusion

The MAC clearly does not envisage a drastic departure from the current immigration system for employer sponsored migrants with a job offer under Tier 2. Whereas, in the case of highly skilled migrants without a job offer, the MAC considers that the current Tier 1 (Exceptional Talent) category is not fit for attracting the type of highly skilled migrants we will need post-Brexit and recommends wide reaching changes. In both cases, the MAC appears to make recommendations that will make both routes more accessible to a wider pool of talent from highly skilled through to medium skilled. But what about low skilled workers?

It is important to note that the MAC’s recommendations are not binding on the government, so whether these will be accepted and implemented as part of the new immigration system remains to be seen. Given the reforms announced to the Tier 1 (Exceptional Talent) route today, it seems unlikely that the government would announce a further re-shuffle in the next 11 months before the new immigration system is due to be introduced, but anything is possible.


This information is necessarily of a general nature and doesn’t constitute legal advice. This is not a substitute for formal legal advice, given in the context of full information under an engagement with Bates Wells.

All content on this page is correct as of January 30, 2020.