Corporate Governance Report interviews international migration expert Sophie Barrett-Brown on the value of immigrants to UK corporations
Immigrants to the UK have received a rush of negative press, confounded by low public support. But how valuable are immigrants to UK corporations, and how easy are they to employ? Corporate Governance Report interviews Sophie Barrett-Brown from Laura Devine Solicitors about the laws and regulations in place to govern international migration.
Corporate Governance Report: Well Sophie, let’s start with how important is immigration to the UK economy as a whole?
Sophie Barrett-Brown: I’d certainly say they [immigrants] are hugely important, and I very much speak from the perspective of employers who employ migrant workers. There have been a number of studies that have demonstrated that they’re key in certain industries, many of them extremely skilled.
Corporate Governance Report: Well moving over to large corporations now, and how important is it to have a migrant friendly environment?
A negative climate around immigration can create concerns for business
Sophie Barrett-Brown: It’s very important for those companies who need that skill base, so it does very much depend on the particular companies and the particular industries, but a negative climate around immigration can create concerns for business, it can deter businesses, particularly inward investment. There have been various examples that I’ve encountered, even in my own practice, and there are more widely spread examples of companies that have chosen to set up in other countries because of concerns around being able to get the staff that they need to come to the UK.
Corporate Governance Report: Well how does the UK stand in terms of the European context?
Sophie Barrett-Brown: It’s quite a sort of mixed position. Each European country has its own domestic laws and they operate very, very differently. And in some respects the UK does have some positives, so the way its system is structured, it is able to respond very, very quickly in certain circumstances. Tier 2 of the points-based system, once a company actually has a licence in place to be able to sponsor workers under Tier 2, can mean that within a matter of days they could have a worker in place, but it can be cumbersome to obtain the licence and it can be very difficult for the companies to find their way through the myriad of requirements and controls.
Corporate Governance Report: How does the UK manage EU migration compared to non-EU migration?
Sophie Barrett-Brown: The UK as a host country for migrant workers from the EU, in theory, should apply the same rules in the same way as other EU countries. But when it comes to migrants who are coming from outside the European Union, then it goes to the domestic laws of each individual member-state country, and they are all completely different and operate very, very differently indeed. So the UK system principally has a points-based system, and Tier 2 is the main route that’s used for employers, but there are categories outside the points based system as well.
Corporate Governance Report: Well there is a reoccurring debate about whether companies should just train local youngsters or hire qualified workers, so how does the UK handle this?
Sophie Barrett-Brown: The UK immigration system itself doesn’t really influence that debate, insofar as the system doesn’t compel employers to have particular schemes in place. That’s a separate area of policy. But, in my experience of clients, reaching for an international solution is not the first port of call. It can be very expensive to have an international assignment, and many employers would first try to recruit locally and train locally. But there are occasions when the skills that are needed are not existent here. What we do have in the UK points-based system is the resident labour market test as part of Tier 2, which does compel employers to test the resident workforce. That’s more about engaging a resident worker who’s already capable of doing the job.
Corporate Governance Report: So the UK doesn’t ever really have anything like positive discrimination for nationals?
Sophie Barrett-Brown: It’s positive discrimination is essentially in the resident labour market test, and I say that because that test requires employers not reject any what’s called settled worker, basically a British citizen, a European citizen, or someone who may be a foreign national but has indefinite leave to remain here. They can only reject an applicant of one of those nationalities if they are incapable of performing the role.
Corporate Governance Report: Are there actually quotas in place on how many immigrants a company can employ?
It’s really critical that employers who are using Tier 2 make sure that they have a full understanding of the Tier 2 sponsorship duties
Sophie Barrett-Brown: There are, but in a limited way. So the quotas only exist in the context of Tier 2 of the points-based system, and only in a particular subset. So for Tier 2 intra-company transfers there are no specific quotas in place. However, a company must ask for a number of certificates of sponsorship to be able to sponsor foreign national intra-company transferees, but they can ask for that to be increased at any time and a decision will be made on a case-by-case basis. For Tier 2 general, and that’s where they’re essentially non intra-company transferees, new hires, some of those certificates of sponsorship for Tier 2 general applicants are what I term restricted, where there is a cap, and some are not. And that cap is an annual limit for all employers wanting to use it of 20,700, and it’s never been reached since it came into force a few years ago.
Corporate Governance Report: Immigration law is sometimes at loggerheads with employment law, so which one wins out in the end?
Sophie Barrett-Brown: Each wins in its own context. So it very much depends on the nature of the claim or dispute or compliance point that is being raised. If an employer has, for example, failed to satisfy the resident labour market test adequately because they have rejected a British candidate who was capable of doing the job but was nowhere near the performance standard of the foreign national, that would mean that they haven’t met the requirements of the test, it would mean they’ve assigned the certificate of sponsorship incorrectly, and that they are effectively in default of their licence. If, however, they choose that resident worker applicant, and the foreign national applicant brings a claim saying “I’m clearly by far the stronger candidate,” then potentially in the employment tribunal they could be looking at significant damages.
Corporate Governance Report: Well how do regulations differ when it comes to skilled and non skilled workers?
Sophie Barrett-Brown: The UK doesn’t really provide for non skilled workers, so under the points-based system, the various tiers, there is a Tier 3 for low skilled workers that has never been implemented, so it exists in name but there is nothing behind that.
Corporate Governance Report: Well finally, what advice could you give to corporations who are taking on migrants, what are the biggest pitfalls they can fall into and how can they avoid these?
Sophie Barrett-Brown: The greatest area they need to be aware of is the compliance issues around Tier 2. As I mentioned earlier, Tier 2 does have great advantages compared to the previous immigration laws, to the extent that it can respond very quickly to situations, but that responsiveness can also sometimes give a false sense of security and it’s quite easy to make errors unwittingly. It’s really critical that employers who are using Tier 2 make sure that they have a full understanding of the Tier 2 sponsorship duties and keep that up to date, because it’s changing all the time. So to either have in-house people who are very skilled and focus on that area, or to use external advisors who specialise.
Corporate Governance Report: Sophie, thank you.
Sophie Barrett-Brown: My pleasure.