The New Minimum Salary Threshold For Overseas Workers on the Skilled Worker Visa
With a commitment to reduce net UK migration figures by around 300,000 people next year, the government is introducing the new minimum salary threshold for overseas workers on Work Visas on 4 April 2024.
In this blog, our Immigration Solicitors look at the new rules and how they may affect UK businesses with sponsor licences.
UK Online and London-Based Immigration Solicitors, Sponsorship Licence and Employment Lawyers
For UK employment and immigration advice call OTS Solicitors on 0203 959 9123 or contact us online.
Is your business affected by the new minimum salary threshold?
Your business will need to pay the new minimum salary threshold if it sponsors and recruits a Skilled Worker Visa applicant and assigns a certificate of sponsorship to the recruit on or after 4 April.
The deadline is in reality 7 pm on 2 April as the Home Office has said their sponsor management system will not be open and available for use between 7 pm on 2 April and 9 am on 4 April.
Current sponsored employees can continue to be paid their existing salaries. New sponsored recruits can only be paid at the old minimum salary threshold if they apply for their Skilled Worker Visa within 3 months of being allocated their certificate of sponsorship.
HR staff therefore need to ensure that visa applicants are aware of the deadline and the importance of sticking to it if the company job offer is contingent on the job applicant applying for their Work Visa within the 3-month limit.
Ultimately, all businesses with sponsor licences will be affected by the changes to the minimum salary threshold and will need to understand the rule changes and transitional arrangements.
What is the new general salary threshold?
The new general salary threshold for the Skilled Worker Visa is £38,700 gross per year. However, the minimum salary threshold is £38,700 or the going rate for the job, whichever is the higher figure. Going rates have also increased significantly in some cases.
For Health and Care Worker Visa applicants, where their job is not based on a national pay scale, the general salary threshold increases to £29,000 gross per year. In healthcare jobs where the salary requirements are based on national pay scales, the general salary threshold will increase to £23,200 gross per year.
The new general salary for the Senior or Specialist Worker Visa under the global mobility route increases to £48,500.
Exceptions to the new general salary threshold
The new general salary threshold will not apply to:
- Skilled workers in sponsored jobs where the going rate salaries are set using national pay scales
- To some sponsored roles falling within the Health and Care Worker Visa
Discounts to the general minimum salary threshold
Discounted minimum salary thresholds are still available if the Work Visa applicant falls into one of these 4 categories:
- Has a PhD relevant to their role - the minimum salary threshold is reduced to £34,830 gross per year
- Has a PhD in a STEM subject relevant to their role - the minimum salary threshold is reduced to £30,960 gross per year
- Qualifies as a new entrant - the minimum salary threshold is reduced to £30,960 gross per year. A new entrant can only be sponsored for up to 4 years
- The job is on the immigration salary list – inclusion on the list reduces the general minimum salary threshold but not the going rate for the job
These discounts to the general minimum salary threshold only:
- Apply at the Skilled Worker Visa stage. They do not apply when a sponsored worker is applying to settle in the UK and making an indefinite leave to remain application
- Apply to the general minimum salary threshold. There is no discount on offer to the going rate and the minimum salary threshold is the higher of either the general minimum salary or the going rate
Changes to the going rate
The going rate for a job is based on the job’s standard occupational classification code. The 4-digit code for many job roles is changing. This may catch out some key personnel and lead to the rejection of certificate of sponsorship requests or visa applications.
The going rate codes are changing because sponsor licence holders have been using the standard occupational classification code scheme 2010. That ceases to apply on 3 April 2024. After that date, key personnel need to use the SOC code scheme 2020.
The 2020 scheme uses salary data from 2023 to calculate the going rate for jobs so that is one reason for the increase in the going rates for jobs. The other reason is that from 4 April 2024, the going rate salaries will normally be based on the 50th percentile of salaries for roles within the relevant standard occupational classification code rather than the previous 25th percentile. This will significantly increase the going rate for some job roles. The Home Office has not tempered this increase with the introduction of regional going rates to assist companies outside of London or the South East where businesses have not been able to historically pay as high a salary as in the South East.
Sponsorship Licence Lawyers warn that the changes to the going rates and standard occupational classification codes can easily confuse those who are not working full time on sponsor management system issues but sharing a key personnel role with other HR or administrative work. One thing to watch out for is that some jobs no longer have a standard occupational classification code. Existing sponsored employees can continue in their employment and can apply to extend their Skilled Worker Visa in the same job role but they cannot switch to a new employer with a sponsor licence and continue to be sponsored in a job with the defunct code.
The introduction of the new immigration salary list
On 4 April 2024, the immigration salary list replaces the shortage occupation list. Around 30% of all Skilled Worker Visa roles were on the shortage occupation list but only around 20 jobs are included on the immigration salary list.
Although the jobs on the immigration salary list will benefit from a reduced general salary threshold of £30,960, they will not benefit from a 20% discount on the going rate for the job’s standard occupational classification code.
Transitional rules for existing Skilled Worker Visa and Health and Care Worker Visa holders
If your business is sponsoring a Work Visa holder whose visa application was decided using the immigration rules in force before 4 April 2024 then they (and your business) may benefit from transitional arrangements applicable to all applications submitted on or before 30 April 2030.
If a sponsored employee comes under the transitional arrangements, then they can continue to be paid the before 4 April 2024 minimum salary thresholds and lower going rate when:
- Applying for a Work Visa extension
- Switching to a new sponsor
- Applying for indefinite leave to remain
How can OTS Solicitors help your business with its sponsor licence?
OTS Solicitors are specialist Immigration Solicitors and Employment Lawyers. We provide bespoke legal advice covering all aspects of immigration and employment law ranging from:
- Sponsor licence applications
- Sponsor licence training for key personnel
- Sponsor licence management services for a fixed monthly retainer
- Certificate of sponsorship allocation advice
- Employment contract advice for sponsored and non-sponsored employees
- HR policy advice and employment tribunal claim advice and representation
- Sponsor licence guidance if the Home Office conducts an audit or suspends or revokes a sponsor licence
UK Online and London-Based Immigration Solicitors, Sponsorship Licence and Employment Lawyers
For UK employment and immigration advice call OTS Solicitors on 0203 959 9123 or contact us online.
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