Now that the UK has left Europe there are changes ahead for businesses wishing to employ EU citizens. Last week saw the biggest change in immigration laws in the UK for over 40 years. The Government unveiled its plans for the current Points Based System to be extended to cover EU citizens. At present, businesses have been able to employ EU nationals by checking their passport and retaining relevant copies. Under the new proposals, companies will need to apply for a visa for their EU population that will be coming to the UK after 1 January 2021 in the same way that they would for a US or South African employee.
It is time to act now. Companies should review and update their sponsor licence and HR systems to ascertain where changes need to be made to ensure they are compliant with the new proposals. Also companies will need to understand what roles will not be eligible for a visa going forwards. Given that there may be no immigration options for low skilled migrants under the new immigration system, businesses may not be able to employ EU nationals that will come to the UK from 1 January 2021 into low skilled roles. By undertaking the role reviews now companies can minimise the disruption of the new immigration system. This will ensure that companies are aware of any potential skills gaps that could impact their operations. PwC's immigration team have undertaken our own survey of almost 100 employers in the UK, who collectively employ half a million people. Employers responding to the PwC survey, which included representatives from all sectors of the economy and regions of the UK, cited a lack of specific skills such as 1) digital 2) technical and languages as key challenges. As high as 69% of respondents find it difficult to recruit from the UK resident population. This means that in the future businesses will need to adjust and look into making a greater investment in staff retention, productivity, technology and automation.
Companies need to be thinking about cost implications. At present it is free to employ an EU citizen however, going forwards the costs could be approximately £8,500 or higher per worker. Therefore companies should also undertake cost projections so that they can be prepared for the changes ahead.
It is important to plan now for the new immigration system. PwC can assist in minimising the disruption by helping companies to develop their immigration compliance strategy. This includes undertaking audit reviews of the existing licence, skills mapping across the business, providing in depth cost projections as well as training and communications to relevant personnel and assisting with the future workforce planning. We have a great team here at PwC and would be happy to help.