What are the key changes to immigration and employment laws in 2021?

What are the key changes to immigration and employment laws in 2021?

As we cautiously make our way into this year, huddled behind our home desks clutching cups of coffee, we all have high hopes for change and progress in 2021.

If you are an employer looking to hire new talent this year or a candidate looking for a new job, then the most important changes you’ll want to be aware of are the ones to immigration and employment laws in 2021, post-Brexit.

Our departure from the EU has been a long time coming, but even despite being overshadowed by a pandemic, and like it or not, since the 31st of January 2020 the UK has been separated from the EU.

You may or may not have been aware of the alterations surrounding immigration and Brexit, so we have put together some of the key changes to immigration and employment law and how they will impact employment and working across the UK, EU or overseas.


Right-to-work compliance

When it comes to employing or hiring talent from outside of the UK there are two questions to ask.

Do prospective or current employees have the right to work in the UK?

And if not, can they secure that right?

To establish this, you need to first assess and then record the right to work. This is important, as any employers who do not conduct a right-to-work check could be exposed to a penalty of up to £20,000.

The CIPD has put together a handy flowchart to establish the right to work, below - view in full here 



Performing the right-to-work check

New employees must have their right to work status checked before their first day of employment, or on the day that they start before any work is undertaken.

You must verify one or more of the original documents from the Home Office, but this can also be performed online in limited circumstances. Be sure to make and keep copies of these documents and record the date you made the check.



Who has the right to work?

British and Irish Citizens, EU settled status, Non-EU visa holders, Non-EU settled status, Commonwealth citizens with a Right of Abode in the UK. (valid passport).


Gaining the right to work

If after completing all the relevant checks, it is found the employees do not have the right to work, there are a few things that can be done.

Apply for settled status: Employees from the EU, EEA and Switzerland who arrived in the UK before 31 December 2020, have until 30 June 2021 to apply for settled status. (see the section on non-EU nationals below for further information)

Get a sponsor Licence: you’ll need a sponsor licence to be employed if you are from the EU, Switzerland, Norway, Iceland or Liechtenstein coming to the UK to work from 1 January 2021.

For those from the EU who do not have a settled status or sponsorship licence from their employer, they will be referred to a new points-based immigration system. Which now operates as the legal framework for how EU and other overseas nationals may come to live and or work in the UK.

Find out more about the points-based immigration system here.




Skilled worker route

As well as introducing the new points-based immigration scheme, the government has also announced a new “skilled worker” route for non-EU-nationals, that will replace the Tier 2 route.

The idea is that this new route will enhance UK employers ability to recruit skilled talent and comes with advantages such as no annual cap on the number of work visas and the resident labour market test will be removed.

The threshold on skills will also be lowered from RQF 6 (degree level) to RQF 3 (A-Level) and other tradeable skills will be introduced to compensate for low salaries, such as a PhD in a relevant field or a shortage occupation job.



Preferential treatment for EU nationals

The changes to the immigration rules are designed to apply to all non-UK nationals based on skills they bring to the UK workforce, however, there still will be some preferential treatment for EU nationals too.

These include no requirement to attend an overseas visa application appointment but instead, EU nationals can use an app to enrol digitally from their smartphones and won't need to supply their fingerprints.

This also means that EU nationals will not be affected by the closure of visa application centres due to covid19, and all that apply under the new immigration rules will receive a digital immigration status that can be accessed securely online.



Recruiting EEA nationals

EEA nationals will have now lost their automatic right to live and work in the UK unless they have applied for either Settled Status or Pre-Settled Status, which can be done before the 30th of June 2021.

What is the difference between Settled and Pre-Settled status?

Settled status is a permanent residency for those who have lived in the UK for a continuous 5-year period.

Pre-settled status is a temporary status for those who have been living in the UK for less than 5 years. After 5 years’ time, you can then apply for settled status (‘continuous residence’).

View more information on settled and pre-settled status here. 

Either of these living and working statuses will give the employee the right to continue to live and work in the UK, and successful applicants will be given a code to share with their employer, that will prove their right to work within the UK.

Like EU nationals, EEA nationals can also be sponsored by their UK employer under the new points-based immigration system.

If you are looking to go down the sponsor route, keep in mind that this is not a quick process and licence applications can take between 3-6 weeks, so be sure the licence is in place in good time.



Changes to IR35 off-payroll

If you are a business that regularly hires contractors, or a contractor working for companies in the private sector then you might have heard about the upcoming changes to the IR35 regulation. These changes were supposed to take place last year, but due to the Covid19 pandemic, IR35 off-payroll changes have been moved to this April 2021.

First introduced back in 2000, IR35 is a law designed to increase the collection of income tax from people who work through an 'intermediary' such as an umbrella or personal services company.

In a nutshell, the new IR35 changes will be implemented in April 2021 for private sector contractors, transferring the responsibility of assessing IR35 from contractors to large and medium companies. This will apply to all payments made on or after the 6th of April 2021.

For further information on the changes to IR35 and how this affects you and your contractors view our article here. 


Please note this article is for education and awareness of the changes to immigration and employment law only and should not be classed as official legal advice. We advise to seek professional expertise and consult the relevant government advice when assessing the right to work and how employment law and immigration changes will affect you.


Sources and further advice: