TheRetailer_Summer_19

Brexit - is your workforce ready?

LOUISE SHAW SOLICITOR Pinsent Masons

FOLLOWING THE BRC’S ROUNDTABLE ON “THE FUTURE OF THE IMMIGRATION SYSTEM”, LOUISE SHAW COMMENTS ON HOW BREXIT WILL IMPACT THE SECTOR. In a sector with high turnover, seasonal demand and low margins, access to labour is crucial. So what to make of the Government’s proposals to end Free Movement and develop a new immigration system “for all”? The End of Free Movement The good news is that European Economic Area (“EEA”) nationals who are already here can stay. They need to register under the EU Settlement Scheme. In a no deal scenario the timescales for residency and registration will be shortened. Retailers are advised to take steps now to reassure colleagues and encourage registration. Many of my clients have already done so. The majority by signposting colleagues to the government guidance and explaining that the process is simple, particularly compared to the 80+ page form for Permanent Residence under the EEA rules! Colleagues need to be aware that if they don’t register they risk losing their right to live and work in the UK. Employers who effectively communicate on this will foster a welcoming environment, which may contribute to improved retention rates. The Post-Brexit World Current government policy is that after Brexit (and any agreed transitional period), EEA nationals will be subject to the same rules as migrants from the rest of the world. This principle means that employers will need a sponsor licence to support work visas for EEA migrants. Basic requirements include conducting the Resident Labour Market Test, a role at degree level and a minimum £30,000 salary. A 3 year visa costs up to £4,400 and the sponsor is bound by strict record-keeping and reporting requirements. The government has proposed changes to the Immigration Rules from 1 January 2021 (ie after the Withdrawal Agreement transition period). These are contained in a White Paper published late last year:

Low skilled options The key challenge for retailers is the sudden narrowing of options for low-skilled labour. This will also impact the supply chain and sub-contractors, all in a challenging trading environment. The 12 month option may prove useful for peak trading periods. However, it doesn’t sit well against the agenda of Retail to create fewer, better quality roles. 12 months disappears quickly once a migrant has found a job and received training. Additionally, the visa cannot be extended and the migrant will be subject to a 12 month “cooling off” period where they will need to leave the UK before they could re-apply. A consequence of a temporary 12 month visa route may be two tiers of employee; (1) settled workers who receive quality training and opportunities and (2) short-term workers with few opportunities. UKVI are currently consulting on the proposals for the low skilled visa route. The sector could seek to persuade them that it would be beneficial to have a cooling off arrangement that sits better with seasonal requirements. Sponsorship Many retailers won’t have a sponsor licence, or their usage of it will be low. The White Paper proposes to reduce the skill level to RQF 3-5, which opens up sponsorship to a wider variety of roles. For example, project administrators, buyers, and team leaders (customer care). This relaxation, coupled with the requirement to sponsor EEA nationals, is likely to lead to a heavier reliance on the sponsorship scheme in future. However the jury is still out on the £30,000 salary threshold. If the threshold is not reduced significantly, then sponsorship will remain out of reach for many roles particularly in the regions. Furthermore, sponsored migrants are still expected to work within one “job code”, which means they cannot move between projects and gain experience in different roles. This type of programme is increasingly common, particularly in Retail head offices. It is a good example of how the immigration rules do not flex sufficiently to meet the needs of modern employers.

• A relaxation the sponsorship regime, including reducing the skill level. • A 12 month visa for “low risk” countries, with no work restrictions. We assume that EEA countries will be included.

10 | summer 2019 | the retailer