19th January 2021
As the Brexit transition period came to an end on 31st December 2020, new policies are impacting employers, particularly with regards to employing EU citizens from now on. In this guide we explore the changes to workplace rights that come into effect from the 1st January 2021.
How Are Workers’ Rights Affected by Brexit?
The majority of workers’ rights after Brexit are expected to have no change, enabling the employer and employee to continue in many processes undertaken in recent years. However, the UK government have advised on changes within two key aspects of employment law:
- Employment Insolvency
- European Works Councils
The changes to these workers’ rights depends on the employee’s residency. Changes are determined if the employee is a UK resident or an EU resident working in the UK.
UK Workers’ Rights after Brexit
Employment Insolvency
UK workers working in the UK will not experience any change to their rights surrounding employment insolvency post-Brexit. UK employees’ rights if an employer goes into administration, liquidation, bankruptcy, receivership, company or individual voluntary arrangement or debt relief order will not change after the 1st of January.
UK employees working in the EU for a UK company will need to check the law in the specific country they are working in as the EU country may not protect non-EU employers or employees.
European Works Councils
For UK employees, from the 1st January 2021, you will no longer be allowed to request your employer to set up an EWC. If the request is submitted prior to this date, you will be allowed to complete this set up.
For UK employees already involved in an EWC, you may continue to be involved after the 1st of January 2021, providing your company agrees. The UK government aim to keep the enforcement framework, rights and protections for employees in UK EWC available as long as possible.
Businesses in the UK will need to review EWC agreements with existing EWC and trade unions after 1st January 2021. UK businesses are encouraged to allow UK workers to be represented on a voluntary basis.
Despite this change, employees still have the right to be informed and consulted about issues at work which will not change post-Brexit.
EU Workers’ Rights after Brexit
Employment Insolvency
Like UK employees, EU employees working in the UK will continue to receive the employment insolvency protection after Brexit. This means that if an employer becomes insolvent as a result of administration, liquidation, bankruptcy or other causes, EU workers in the UK will still receive the same level of protection as UK workers.
European Works Councils
UK businesses are required to review the agreements made with existing EWCs after the 1st of January 2021. EU workers will continue to receive the right to be informed and consulted regarding issues at work after this date.
Recruiting People Outside of the UK
From the 1st of January 2021, the freedom of movement between the UK and the EU will end and a new immigration system is being introduced to the United Kingdom. This means that employers looking to hire employees outside of the UK (including Irish citizens) require permission beforehand. Employers in the UK will need to apply for a sponsor licence to hire most workers outside of the UK.
Whilst the Brexit transition period ended on the 31st of December 2020, the new system will not apply to EEA or Swiss citizens already employed in the UK. If living in the UK by the transition deadline, they and their families can apply for the EU Settlement scheme. The deadline for this application is the 30th of June 2021. For employers looking to hire EEA and Swiss citizens to work in the UK from the 1st of January 2021, they are also required to apply for a sponsor licence.
What is a Sponsor Licence?
A sponsor licence grants you permission from the UK Home Office to hire employees outside of the UK. As an employer, you will need to meet eligibility criteria before being allowed to apply for a sponsorship licence. On success of the application, your business becomes a Home Office licensed sponsor. For employees applying to work in the UK, they require a job offer from such a sponsor.
Organisations have the ability to hire employees outside of the UK in the following ways:
- Skilled workers route
- Intra-company transfers
- Other routes
Skilled Workers
Skill level: RQF3 (A-level equivalent) or above
Minimum Salary: £26,500
Sponsor Licence Required: Yes
Other Requirements: English speaking
Skilled Workers Requirements
Employees applying to work in the United Kingdom under the skilled worker application must have a job offer from a Home Office licensed sponsor and they must demonstrate a competency to speak English at the required level. The qualifications required for their role is the equivalent to RQF3 or above (or A-levels) and the salary must be at least £26,500 or the “going rate” for the role, whichever is highest.
Skilled Workers Exceptions
There are some exceptions to the salary rules within this application for those with a job offer from the shortage occupation list, those with a PhD in their field or for those starting their career within the health or education sector.
Employers looking to hire employee workers with a salary less than £20,480 or for a role requiring a skill level below RQF3 will not be able to recruit from outside of the UK.
Intra-company Transfers
Skill level: RQF6 (graduate equivalent) or above
Minimum Salary: £41,500
Sponsor Licence Required: Yes
Other Requirements: Minimum of 12 months’ employment at an overseas company linked to a UK place of work
Intra-company Transfer Requirements
This applies to employers wanting to transfer existing workers overseas to the UK. Similarly to the skilled workers route, intra-company transfers will be subject to skill and salary criteria.
As an employer, you will need to gain a sponsorship licence and the employee requires a minimum of 12 months’ experience working for a business overseas linked by ownership to the UK business they will work for.
The skill level required for an intra-company transfer role must be graduate level equivalent or above (RQF6). The salary threshold for intra-company transfer applicants is higher than that of a skilled worker with a minimum salary of £41,500 or the “going rate” for the role, whichever is higher.
Whilst this route for working in the UK is seen as a temporary method, employees can be dispatched to the UK multiple times and can stay up to five years within a six-year period.
Intra-company Transfers Exceptions
Employees who are paid over £73,900 are exempt from the 12-month minimum term employment with their sister company prior to the transfer. Employees that fit these criteria are allowed to stay in the UK for up to nine years within a ten-year period.
Other Routes
For working in the UK, there are a number of other routes employees may be eligible to apply for. These rely on skills that the UK is in demand for within certain sectors. These include:
- Start-up and Innovators
Proof of funding is required for at least £50,000 and can be applied for by individuals or teams. - Health and Care visa
Closely aligned with the skilled worker route, this relies on a job offer from the NHS, social care sector or businesses that service the NHS. - Creative Route
For those who have short-term contracts (up to 12 months’ engagement) with an organisation within the creative industry. The employer must be a recognised Home Office licenced sponsor and the applicant must have a job offer in place. - Sporting Routes
International sports people applying for the right to work in the UK within the sporting industry must have sponsored employment, a job offer and be endorsed by the relevant sport body.
What is changing?
As well as EEA and Swiss citizens having to apply to work in the UK from the 1st January 2021, there is one change to the routes available to potential applicants.
After Brexit, one method for applying to work in the UK that is still in question after Brexit is the seasonal worker pilot. Designed to provide labour for the agricultural industry, it had been scheduled to end on 31st December 2020. The UK government has now extended this application method for another year until the end of 2021 with an extended quota of 30,000 places (an increase from 10,000 in 2020).
If you currently employ or are looking to employ non-UK residents to work in the United Kingdom, our payroll and employment law specialists can assist you to ensure you are fully compliant to the latest post-Brexit legislation.
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