Minimum Salaries for Sponsored Overseas Workers From 4 April 2024
It isn’t too late to consider how your business will be affected by the increase in minimum salaries for sponsored overseas workers and to consider what you can do to mitigate the impact on your business.
Our Immigration Solicitors look at the minimum salary threshold from 4 April 2024 and the steps sponsor licence holders can take.
UK Online and London-Based Immigration Solicitors and Sponsorship Licence Lawyers
For immigration advice call OTS Solicitors on 0203 959 9123 or contact us online.
Salaries for new sponsored workers rise on 4 April 2024
If your business sponsors a new sponsored worker on a Skilled Worker Visa on or after the 4 April 2024 you will need to pay them the increased minimum salary threshold.
The increased minimum salary threshold rises by nearly 50% from £26,200 to £38,700 but there is still the caveat that a sponsoring employer must pay the minimum salary threshold or the ‘going rate’ for the job, whichever is the higher figure.
The going rates are set by the government after consultation with the Migration Advisory Committee and are subject to ongoing review.
Any employee asking for a pay rise from £26,200 to £38,700 in a single leap would likely be told ‘no’. The economics are unlikely to add up and that is also why sponsor licence holders will have to weigh up the affordability of sponsoring some jobs after 4 April 2024.
Sponsorship Licence lawyers recognise that UK business owners and sponsor licence holders face tough decisions as it is said that nearly 9 million people have quit the job market. According to ONS statistics around 2.8 million people are suffering from long-term sickness preventing them from re-entering the job market. There is also the ongoing issue of the UK skills gap with those people who are available for work not necessarily having the skills UK employers are looking for.
Steps sponsoring employers should consider before April 2024
Sponsorship Licence lawyers recommend that where possible you:
- Assess your recruitment needs for 2024
- Consider if your recruitment needs can be met through internal promotion or UK-based recruitment
- If additional sponsored workers are needed sort out their recruitment before the April deadline. Sponsorship lasts up to 5 years so could provide stability whilst you put in place long-term apprentice schemes and work on staff retention schemes so sponsored workers stay with the company after they have settled in the UK through securing indefinite leave to remain and British citizenship
- If you employ workers on Graduate Visas look at the expiry date of their Graduate Visas. Consider if it is economic for you to get them to switch to the Skilled Worker Visa before the minimum salary threshold increases. This may depend on whether you know your business will not be able to afford to sponsor them as skilled workers once their Graduate Visa ends and if the jobs they are doing fall within a standard occupational classification code
- Assess the costs and timescales of apprentice schemes or training costs for UK-based recruiting and compare overhead increases with the rise in the minimum salary threshold
- Look at increasing your recruitment of international students able to work part-time on Student Visas and who are not subject to a minimum salary threshold (other than of course the national minimum wage)
- See if you can develop links with colleges and universities to increase your recruitment of graduates on Graduate Visas – but this is likely to be a short-term solution as the Migration Advisory Committee is reviewing this route. Changes are highly likely
- Look at whether you are doing all you can to retain staff to try and reduce the need for replacement overseas staff
- Take a holistic approach and review commercial and consumer contracts to see if contracts provide for price reviews to pass on your increased overheads with sponsorship post 4 April 2024
- Take ongoing expert advice from Sponsorship Licence lawyers as the shortage occupation list is to be replaced by an immigration salary list. It is said that this list will allow employers to offer sponsored employment to some overseas workers with a general salary threshold discount. If you cannot avoid having to pay the increased minimum salary threshold to new recruits on Skilled Worker Visas then Sponsorship Licence lawyers may be able to suggest savings in sponsor licence costs by using a professional sponsor licence management service
One thing to emphasise is do not be tempted to take shortcuts and to employ people who do not have the right to work. You put your sponsor licence at risk and face a massive fine. For more information take a look at our article on Right to Work and Rent Fines for Employers and Landlords Increase on 13 February 2024.
How can OTS Solicitors help your business get ready for April?
Our Business Immigration Solicitors and Sponsorship Licence lawyers believe in proactive legal advice that is commercially focused.
We can assist with your strategic short-term and long-term business planning through:
- Business immigration and sponsor licence advice on all aspects of sponsor licencing and sponsor licence management service
- Employment law advice including employment contracts and employment policies
- Employment law issues including grievance resolution and claims
- Corporate and commercial advice
UK Online and London-Based Immigration Solicitors and Sponsorship Licence Lawyers
For immigration advice call OTS Solicitors on 0203 959 9123 or contact us online.
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