Following the announcement by the Home Secretary in December 2023 that several key measures would be introduced to bring down record net migration figures, there are a number of important changes in 2024 that individuals and sponsors should be aware of.

The government estimates the measures announced in May and December last year would result in around 300,000 fewer people qualifying to come to the UK. We assess some of the more critical updates in this article for non-care sector businesses, together with the timeline for implementation.

Minimum salary for Skilled Worker visa to increase

The minimum basic annual salary to apply for a Skilled Worker visa will increase from £26,200 to £38,700 from 4 April 2024 – a 48% uplift. When assessing eligibility, there are technically two salary thresholds that must be met. The first is the minimum "going rate" for the type of role the migrant will perform in the UK, as prescribed by the Standard Occupational Codes (SOC). The second is the minimum rate for the type of visa i.e. £26,200 increasing to £38,700 for a Skilled Worker. The higher of the two thresholds apply.

When can you pay an employee less?

However, in some cases you can be paid less. If the employee is under 26, is studying or recently graduated, has a qualifying PhD level qualification, or has a shortage occupation role, it is possible to be paid 10-30% lower than the SOC code minimum – so long as they still earn at least £20,960 (new entrant and shortage occupation) or £23,580 (PhD) per year.

The government confirmed the 20% reduction for shortage occupation roles will come to an end in April. Currently, businesses can benefit from a lower going rate and a reduced visa application fee. Whilst it is expected the concessions for employees who are under 26, or recently graduated (i.e. "new entrants"), or those with a relevant PhD qualification will remain in place, it is unclear whether a lower salary threshold against the new £38,700 minimum will still apply and, if so, what it will be. It is hoped that this has been considered when the new Immigration Rules are laid out on 14 March 2024.

Arrangements for existing visa-holders

This increase will apply for all visa applications submitted online on or after 4 April 2024. There will be transitional arrangements in place for existing Skilled Workers, who extend or switch employers or apply for settlement. However, it is expected they will still need to meet the minimum rates (25th percentile) as per the ONS Annual Survey of Hours and Earnings (ASHE) 2023 data, as opposed to the ASHE 2021 data, which are likely to be higher due to inflationary pressures. It is also unclear whether the 20% reduction for prior shortage occupation roles will also apply, or whether employers will need to uplift the salary to the full going rate when making a further application.

Immigration Salary List and salary discounts

The government commissioned the Migration Advisory Committee (MAC) to conduct a rapid review of the Shortage Occupation List (SOL), pending a full review in the near future. The MAC's recommendations are due to be published on 23 February 2024. Whilst we know the SOL in its current form and the 20% reduction to the minimum "going rate" will be scrapped from April 2024, the MAC has been tasked with recommending which roles on the SOL should be temporarily transferred to a newly created Immigration Salary List (ISL).

It is expected that roles that make it onto the ISL will benefit (at least temporarily) from a discounted salary. The government's criteria for the list includes whether the sector has a realistic and sustainable talent strategy for the future, the role is skilled and any discount to the salary threshold will be meaningful and beneficial without putting downward pressure on pay – which could potentially put off resident workers.

Therefore, whilst the SOL and blanket 20% reduction will be removed, there may still be some flexibility for business suffering skills shortages in roles which make the ISL list.

Earned income threshold for family members to increase

The minimum income threshold for family members applying as dependants of settled workers (i.e. British/Irish passport holders, indefinite leave to remain or pre-settled status/settled status under EUSS) is also changing. Following widespread concern, this will now be staggered over a period of time. The minimum earnings threshold from 11 April 2024 will increase from £18,600 for a single dependant to £29,000. The threshold will further increase to £34,500 and then to £38,700 by early 2025.

For those relying on income to meet the criteria, this is a significant increase and will undoubtedly impact many families hoping to repatriate or bring dependants to live in the UK. It is important to remember that whilst applicants can only rely on the sponsor's income for an Entry Clearance application (i.e. outside the UK), applications made in the UK can rely on either the sponsor or the dependant's income.

Other sponsor updates

Immigration Health Surcharge increases

The Immigration Health Surcharge is a fee levied at the point of application for main applicants of Skilled Workers and their dependants. The fee can either be paid by the sponsor or the individual and is charged per six months of the length of visa applied for. The charge is now £1,035 per year for an adult and £776 for each child.

The cost of a three-year Skilled Worker visa for a main applicant will increase from £1,872 to £3,105. Similarly, a family of four would see costs increase from £6,564 to £10,866.

Given the increased costs of sponsorship, many businesses are reviewing their internal policies on visa application fees. If the sponsor chooses not to cover the full cost of the visa, some will consider other mechanisms to cope with the upfront cost. This can include offering a loan repaid through the employee's salary or a claw-back if the employee leaves within a set period of time.

Sponsor licence renewal now automatic

Until recently, sponsor licences needed to be renewed and a fee paid every four years. UKVI has now abolished the requirement to renew a licence from 6 April 2024, offering automatic extensions for 10 years. If your current licence is not due for renewal until on or after 6 April 2024, the extension should now be visible on your Sponsor Management System. If your licence expires prior to this, you will need to renew it in the usual way prior to the expiry date and pay the renewal fee which will be refunded in due course.

Prevention of illegal working and increase in civil penalties

From 13 February 2024, the Home Office has tripled civil penalty fines for employers (up from £15,000 to £45,000 per illegal worker for a first breach, and up from £20,000 to £60,000 for a repeat breach). The last increases to civil penalties were in 2014, so these rises are significant.

Read more about this in our blog post here.

Biometric Residence Permit expiry dates

You may have noticed that all Biometric Residence Permit cards now expire by 31 December 2024. This does not mean that the employee's leave expires on 31 December 2024, which is why it is important to carry out a compliant right to work check and obtain a share code from your employee. From 1 January 2025, the Home Office plans for all visas to be digital, but is yet to publish any further guidance on the switching of status from a physical document to an e-visa.