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This week, the Migration Advisory Committee (MAC) released their final report on EEA migration in the UK. The report was commissioned by the Home Secretary in 2017, and its purposes were 1) to look at the impact of EEA migration on the economy and society of the UK and 2) to gather evidence to assist in the development of a new immigration system for the UK post-Brexit.

In relation to the impact of EEA migration on the UK, the report concluded that on average there was no impact on wages or unemployment levels for the native workforce, although there were minor variations across different regions and between higher and lower-skilled roles. This key finding would appear to significantly undermine the arguments of opponents of free movement which were instrumental in the outcome of the Brexit referendum.

Recommendations

The key recommendations for a reworked immigration system were:

• That there should be no special treatment for EU nationals (unless this is agreed as part of a Brexit deal)
• The cap on the number of migrants coming to the UK annually under the Tier 2 (General) visa should be removed
• The skills threshold should be lowered, allowing NQF level 3 roles and above to be filled by migrants on a Tier 2 (General)  visa, but the earnings threshold of £30,000 should be retained
• It should be easier to change employer when a migrant is in-country
• The bureaucratic burden of obtaining a Tier 2 (General) visa should be reduced
• The resident labour market test should be abolished
• There is no specific need for a special scheme for lower-skilled workers, other than in seasonal agriculture

Some of these recommendations will be welcomed by employers. For instance, a wider range of roles would be available to be filled by migrant workers if Tier 2 (General) was opened to mid-level roles. The reason why these roles are not currently able to be filled by non EEA migrants is because it is thought that the resident labour market, together with EEA migrants, are able to fulfil the demand. However, with the uncertainty of Brexit, employers would likely welcome an expansion of the types of roles they could recruit for outside the EEA. However, the fact that the earnings threshold will remain at £30,000 will clearly make things more difficult.  Moreover the MAC report expressly recommended that there should be no regional variations. This means that parts of the UK where average earnings are lower may still struggle to fill such roles if this recommendation was implemented.

Another welcome recommendation is the desire to decrease bureaucracy in an effort to encourage highly skilled and qualified individuals to come to the UK. The abolition of the resident labour market test would also make this easier.

Reaction

Unsurprisingly, a number of business leaders in sectors where many lower-skilled workers come from within the EEA have expressed their disappointment and resistance to the finding that no specific immigration scheme for lower-skilled workers is required. The chief executive of the Road Haulage Association, quoted in the Guardian, described the idea that only high-skilled immigration should be permitted as “both ignorant and elitist”.

The finding by the MAC that a lower-skilled migrant route was not necessary is based on the idea that the majority of EEA migrants currently in the country and working in lower-skilled roles will remain after Brexit. Furthermore, they point out that shortages in, for example, the care sector, are a result of poor working conditions and salary in the industry as a whole, and that if this were addressed the shortage would likely resolve itself. While this may well be true, it is difficult to see a resolution to these issues at any industry level in the short term.

The MAC acknowledged that in the seasonal agriculture sector, there may be a requirement for specific schemes to ensure that sufficient workers could come to the UK to service levels of demand. One suggestion of the MAC was that employers willing to pay higher than minimum wage levels should have privileged access to the scheme, to ensure that the resident workforce is not being undercut.

The Government has already recognised the pressure on this sector with fewer workers available year on year. As we noted in our previous Insight, there was a 12.5% shortfall of workers required for seasonal work last year. The majority of workers currently carrying out short term, low skilled agricultural work come from Eastern Europe. To address the anticipated further shortfall post-Brexit, the Government announced a pilot scheme allowing fruit and vegetable farmers to employ migrant workers for up to 6 months. A total of 2,500 workers from non EEA-countries will be able to carry out such work in the UK each year to counteract the effects of Brexit. However, it remains to be seen whether the scheme will prove attractive to third–country nationals, and whether the numbers coming over will be sufficient to make up any shortfall created by Brexit.

Going Forward

How many of the MAC recommendations will be taken forward clearly depends on the outcome of the Brexit negotiations in relation to EEA migrants post-transition period. The Committee states that the UK could develop an immigration policy which could be linked to trade but expressly declined to express a view on whether immigration should be part of the Brexit negotiations.  In any event, unless free movement is agreed without change from the current system, it is likely that an overhaul of the Tier 2 (General) category will be necessary in the near future.  While it is clearly important to ensure that immigration is not used to undercut salaries for the resident workforce, it is also important that the needs of all industry sectors are taken into account when the system is designed.

If you have any queries regarding business immigration or any of the issues discussed above, please contact a member of the Stronachs Employment Team.

Annika Neukirch, Solicitor

Chambers UK 2018

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