Significant changes to Skilled Worker Route from 4 April 2024

When the Government announced its five-point plan for immigration in December 2023, it made clear that the key aim of the changes was to reduce net migration. With work and study routes being the biggest contributors to UK net migration figures, it was no surprise that the widely used Skilled Worker route was targeted for change.

After months of waiting, the Government published the Statement of Changes to the Immigration Rules earlier this month, which set out the detail of the proposed changes, including an increase to the minimum general salary threshold for Skilled Workers.

The changes to the Skilled Worker salary thresholds are some of the most drastic changes we have seen since the changes made to work routes post-Brexit. The result of these changes will undoubtedly make it more difficult for employers to source suitably skilled candidates, and will likely have a starker impact outside of London and the south east where salaries tend to be lower.

Summary of the changes

• Increase in minimum general salary threshold for new Skilled Workers

The biggest change is to the minimum general salary threshold for sponsorship. From 4 April 2024, it will increase from £26,200 per annum to £38,700 per annum. In addition, the way in which the ‘going rates’, which are the occupation-specific salary rates, are calculated, is also changing. From 4 April 2024, the going rate will be calculated with reference to the median Annual Survey of Hours and Earnings (ASHE) data (previously set at the 25th percentile). The worker will need to be paid the higher of £38,700 and the applicable going rate to be eligible for sponsorship.

• Tradeable points still available

From 4 April 2024, it will be possible to pay less than £38,700 in certain circumstances where the applicant can ‘trade’ points on specific characteristics against their salary. In such circumstances, the minimum general salary threshold will be reduced to £30,960 (or £34,830 in some cases). An applicant will need to be paid the higher of:

• £30,960 per annum (or £34,830 in limited cases); and
• 70-90% of the ‘going rate’ for the role.

The percentage reduction on the ‘going rate’ will depend on the reason for claiming tradeable points.

• Transitional provisions

When the planned salary increase was first announced, the Government had said that current Skilled Workers would not be subject to the new higher salary threshold and that transitional provisions would apply. Whilst the new higher general salary threshold does not apply, transitional provisions are a lot less generous than expected.

Under the complex transitional provisions, Skilled Workers who had valid permission in the UK under the Skilled Worker route prior to 4 April 2024 will benefit from a lower general salary threshold if:

• the application for an extension of stay as a skilled worker is made before 4 April 2030;
• the applicant was granted permission as a Skilled Worker under the rules in place before 4 April 2024;
• the applicant has had continuous permission as a skilled worker since then.

In such instances, the applicant must be paid the higher of:

• £29,000 per annum; and
• The ‘going rate’ for the role.

The going rates for these applications have been updated in line with the current 25th percentile ASHE salary data. Those covered by the transitional provisions can also continue to rely on tradable points and, where relevant, will need to be paid the higher of:

• £23,200 per annum (or £26,100 in some cases); and
• 70-90% of the going rate.

As a result of the changes, some occupations are no longer eligible for sponsorship. Where this is the case, those applicants affected will only be eligible to extend their permission to stay under the transitional provisions where they are applying to continue to work for the same sponsor.

• Shortage occupation list

The shortage occupation list is being replaced by a new Immigration Salary List (‘ISL’), with the number of occupation codes on the list reduced significantly. Whilst roles included on the new ISL will benefit from a lower general salary threshold of £30,960, they will no longer benefit from a 20% discount to the ‘going rate’.

• Health and care worker visas

Health and care worker applicants are exempt from the new minimum general salary threshold of £38,700. The relevant salary threshold will depend on whether the role is subject to national pay scales or not.

Where the applicant is applying to work in a role that is subject to national pay scales, they must be paid in line with the national pay scale for their role and at least £23,200 per annum, whichever is higher. For health and care visa applicants whose role is not subject to national pay scales then a lower general salary threshold of £29,000 will apply (subject to reductions for tradable points, if eligible).

Deadline for assigning new Certificates of Sponsorship (CoS) before the salary increase

In advance of the 4 April 2024 increase to the minimum general salary threshold for visa sponsorship, the Home Office has updated its sponsor guidance, setting deadlines for the issuing of certificates of sponsorship before the immigration rules change on 4 April 2024.

To implement the changes to the immigration rules, the sponsor licence application form and sponsor management system (SMS) which organisations use to manage their sponsor licences, will be offline between 7pm on 2 April 2024 and 9am on 4 April 2024. Certificates of Sponsorship will not be able to be applied for, or assigned, during this period. Time is therefore of the essence for employers wishing to sponsor workers under the rules currently in place before the changes come into effect next week.

Should your organisation require advice and assistance to navigate these changes, please get in touch with a member of our immigration team.