- The UK Border Agency Announce Changes to Minimum Salary Thresholds, Standard Occupation Codes and Resident Labour Market Requirements
- March 11, 2013
- Law Firm: Faegre Baker Daniels - Minneapolis Office
The UK Border Agency has now released a Statement of Intent, which if approved will take effect on 6 April, 2013. The Statement of Intent deals with three specific areas and will have an impact on all employers currently sponsoring migrants. These areas include changes to the standard occupation code (or skilled occupations), changes to the minimum salary thresholds and appropriate salary rates for each occupation, and changes to the resident labour market test.
The changes to be adopted by the UK Border Agency are largely based on the recommendations of the Migration Advisory Committee, which provided a detailed report in October 2012. Whilst the Statement of Intent sets out the current intentions of the UK Border Agency, they must lay these changes to the Immigration Rules and therefore these intentions are still subject to possible change.
Changes to the Standard Occupation Codes
The skill threshold for Tier 2 will remain the same at NVQ6. However, the SOC table is being updated so that it is in line with the SOC 2010 occupation codes rather than the current SOC 2000 occupation codes. For employers this will mean familiarising yourself with the new codes. By way of example, Directors and Chief Executives of major organisations will change from their current SOC 1112 to either 1115 or 1131. The 2010 code has been split into two categories: 1115 Chief Executives and Senior Officials and 1131 Financial Managers and Directors.
In addition, the UK Border Agency has indicated that they will update and expand the current PhD-level occupations. It is intended that the PhD-level list would include:
- 2111 Chemical Scientists
- 2112 Biological Scientists and Biochemists
- 2113 Physical Scientists
- 2114 Social and Humanities Scientists
- 2119 Natural and Social Science Professionals not elsewhere classified (this can also be used for research posts in research organisation other than universities)
- 2150 Research and Development Managers
- 2311 Higher Education Teaching Professionals
Employers should be aware that certain concessional arrangements are made for employees who undertake a PhD level occupation.
Changes to Minimum Salary Thresholds and Appropriate Salary Rates Per Occupation
Since the April 2011 changes, employer would be familiar with the current minimum salary requirements for the various Tier 2 Intra-company transfer categories and Tier 2 General categories. It is intended that these thresholds be uplifted as follows:
- Tier 2 (General) will increase from £20,000 to £20,300
- Tier 2 (General) that are exempt from a resident labour market test will increase from £150,000 to £152,100
- Tier 2 (ICT) (Short Term Staff, Skills Transfer or Graduate Trainee) will increase from £24,000 to £24,300
- Tier 2 (ICT) ( Long Term Staff) will increase from $40,000 to £40,600
In addition to the salary thresholds, minimum salary rates for each SOC have been reviewed. The approach taken is to include a reduced minimum salary for those who meet a ‘new entrant' criteria. One of the previous shortfalls in the 2000 SOC was that, for many occupations, the minimum salary requirements was based solely on the job being for an experienced worker and did not make allowance for the role being undertaken as part of a graduate programme.
If the new lower pay threshold is accepted it means that the salary for the new entrant employee will be set at the 10th percentile of the pay distribution for full time employees in that occupation.
To qualify for the new entrant salary level the following will apply:
- Graduates switching from a Tier 4 into a Tier 2 under the post study provisions;
- Graduate recruits where the employer has used a university ‘milk round' to satisfy the Resident Labour Market Test;
- Those sponsored in the Intra-Company Transfer Graduate Trainee route; and
- Anyone aged 25 or under on the date of their original tier 2 application
This is beneficial for those employers who were unable to take on such graduate positions in the past due to the minimum salary levels. However all employers will need to be mindful that the new entrant salary will not be allowed when the employee applies for an extension beyond the three years and one month time frame. It will be expected that at this point the employee will be an experienced worker and will need to be paid as such.
Whilst the new entrant salary is welcomed, it does mean that some occupation codes will also see an increase in the minimum salary required for an experienced worker.
Changes to the Resident Labour Market Test (RLMT)
The core elements of a RLMT will remain unchanged save for two factors:
- At present employers only have to advertise in one medium if a salary of £70,000 or more is to be paid to the prospective employee. As from 6 April, 2013 it is proposed that this will increase to £71,000. Employers will still be required to advertise with Job Centre plus (Gov.uk) for salaries less than £70,000 plus one additional medium.
- Rather than the UK Border Agency providing a restrictive list of acceptable locations to advertise, the following more liberal criteria will need to be met.
Type of Medium
Criteria for Suitable Media
Marketed throughout the UK or throughout the whole of the devolved nation in which the job is located, and
Published at least once a week
Available nationally through retail outlets or through subscription,
Published at least once a month, and
Related to the nature of the job i.e. a relevant trade journal, official journal of a professional occupational body, or subject-specific publication
Must be one of the following:
An outline version of a newspaper or a professional journal which would satisfy the criteria above
- The website of a prominent professional or recruitment organisation, which does not charge a fee to jobseekers to view job advertisements or to apply for jobs via those advertisements, or
- If the employing company has over 250 permanent employees in the UK on your own company website
The UK Border Agency is setting out transitional arrangements to make certain allowances for those advertisements that may have been published using the lower salary threshold amounts.