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A post-Brexit trade deal has been finally agreed upon between the UK and the European Union, ending their fifty-year old relationship.
Jan. 1, 2021 marked the end of the free movement of people, goods, and services between the UK and the European Union. In addition to the new points-based immigration system now in effect, Brexit will start impacting how people work, live, and travel between the UK and the European Union.
What does this mean for UK employment law?
According to a recent survey by the3million, which is the largest campaign organization for EU citizens in the UK, employers are struggling to understand the new immigration system.
Only 14 percent of employers were clear on the new rules of employing EU citizens after the free movement ended in December 2020. Alarmingly, the poll also showed that one in five EU citizens may be discriminated against when seeking work in the UK.
With such a major overhaul taking place at the start of 2021, employers should bear in mind these five important facts about UK employment law after Brexit:
#1: The new points-based immigration system — no preferential treatment for EU citizens.
Brexit marks the birth of UK’s new points-based immigration system. According to the UK government, the need to bring a new immigration system was necessary, as it was distorted by European free movement rights.
The main aim of the points-based immigration system is to treat EU and non-EU citizens equally by reducing the overall levels of migration and prioritizing highly skilled employees, such as engineers and scientists.
In addition, the UK government does not aim to focus on low-skilled and low cost labour coming in from Europe using a temporary route. Instead, it plans to increase investment in technology and automation.
The overall costs and fees associated with sponsoring visa applicants has not changed dramatically, but sponsorship is expected to become more common now that free movement has ended.
Nowadays, to qualify for a skilled worker visa, employees who want to move to the UK must score a total of 70 points. According to the UK government, the breakdown of points is as shown below:
#2: EU citizens entering the UK — an end to the freedom of movement.
Following Brexit, the free movement of citizens has come to an end. EU citizens will no longer have the right to move to the UK to work and settle.
In short, employees moving to the UK from Jan. 1, 2021 from any European countries, such as Germany and the Netherlands, would be required to go through the same immigration restrictions that already apply to citizens from India or China.
The same rules do not apply to Irish citizens due to the pre-existing Common Travel Area arrangements.
European Economic Area (EEA) citizens who were already living in the UK by Dec. 31, 2020 need not go through this new system — on the condition that they apply to the EU Settlement Scheme (EUSS) by June 30, 2021. If their application under EUSS is successful, they will be allowed to remain, study, and work in the UK.
In addition, EEA citizens who are living outside UK can still visit the UK for business or short trips, although they may have to justify their trips at the UK borders. Most visitors and employees can only carry out business meetings and attend conferences, but cannot legally “work” in the UK. Frequent visitors to the UK may come under the scrutiny of border officials, who have the right to ask their purpose and length of intended stay.
#3: UK citizens who want to move to the EU must get ready for thorough border checks.
Just as the removal of free movement rules from Jan. 1, 2021 affects EEA citizens arriving in the UK, the same stands true for British employees moving to Europe. As per a document published by the European Commission, UK nationals travelling to the European Union and Schengen Area would now be treated as third-country nationals, and therefore would be subjected to thorough checks at the borders when entering EU countries.
According to the Schengen Borders Code, UK nationals will not need visas to stay in EU countries for up to 90 days in any six month period, as long as they do not work. It is important for UK residents to check European country-specific rules and be aware of documents required for residency and employment.
#4: Employees must check and apply for the EU Settlement Scheme (EUSS).
Employees from the EU, EEA, and Switzerland must apply to the EUSS by June 30, 2021 to continue living and working in the UK. Successful applications would either get a settled or a pre-settled status.
Employees who have lived in the UK for a continuous five-year period (also known as continuous residence) will be given a settled status. If employees do not have five years of continuous residence, they will be given a pre-settled status.
A crucial point for employers to remember is that they should not monitor whether employees have applied to the EUSS or not, but should offer support, if need be.
According to the UK government, frontier workers (employees who work in the UK but do not live there) do not need to apply for the EUSS, but instead require a frontier work permit, which would allow them to continue working in the UK without needing a sponsorship.
The checks for right to work will not change until July 1, 2021, after which UK employers hiring employees from the EU, EEA, and Switzerland will need to check digital status under EUSS.
#5: Employers much meet licensing and sponsorship requirements.
The UK government’s Brexit checker tool can help you get a personalized list of actions for both employers and employees. This tool aims to help companies prepare for Brexit, particularly if they deal with personal data or employ EU nationals. Companies must bear in mind that starting January 2021, they would need a license to employ workers from the EU, Switzerland, Norway, Liechtenstein, and Iceland.
Irish citizens, individuals with a settled or pre-settled status under the EU Settlement Scheme, and those with indefinite leave to remain in the UK do not require a sponsorship. It is important for employers to note that sponsoring someone does not guarantee that they will be allowed to stay in the UK.A crucial point for employers to remember is that they should not monitor whether employees have applied to the EUSS or not, but should offer support, if need be. Click To Tweet
An Employer of Record can help your company navigate Brexit compliantly
Since the day of the Brexit referendum, many global employers and companies have been proactively planning their responses to Brexit.
Employers thinking about navigating Brexit, relocating multiple employees, obtaining work permits, and setting up locally compliant payrolls can be greatly benefit from using Globalization Partners’ Employer of Record (EOR).
It is always advantageous to consult international expansion experts on future trade, immigration, and economic policies to maintain compliance.
Using our comprehensive solution, we can help you navigate the changing labor laws and regulations compliantly. An EOR like Globalization Partners handles legal compliance and payroll so you don’t have to.
This also means you can expand into a country more rapidly since you don’t have to wait until you are legally established there before you can start hiring employees.