News & Insights

New points-based immigration system to be implemented from January 2021


On 19 February 2020, the government published a policy statement setting out the initial details of its plans for a new UK points-based immigration system from 1 January 2021, once free movement with the EU has come to an end.

Under the proposals:

  • EU and non-EU citizens will be treated equally.
  • The government will not introduce a general low-skilled or temporary work route.
  • Migrants to the UK will have to score 70 points under the new system to qualify for a visa.
  • The skills threshold for roles that can be filled by migrant workers will be reduced to include “medium skilled occupations”.
  • EU citizens will benefit from a more streamlined application process than non-EU citizens.

A “new” points-based system

From 1 January 2021, following the end of free movement between the UK and EU, a new Immigration System will come into force.

Under the new scheme, EU and non-EU citizens will be treated equally. The government says that it is intended to cater for the most highly skilled workers, skilled workers, students and a range of other specialist work routes, including routes for global leaders and innovators. The changes are significant as they will affect how employers can recruit both EU and non-EU citizens in the UK after 1 January 2021.

Skilled workers

The policy paper confirms that the current Tier 2 route will be broadly similar to the new Skilled worker category.  They key differences, are:

  • The system will apply to both EU and non-EU citizens.
  • The skills threshold will be reduced from (RQF) level 6 (equivalent to degree level) to level 3 (equivalent to A-level), to include “medium skilled occupations”.
  • The resident labour market test process will be abolished.
  • The cap on the number of people able to enter the UK under the skilled worker route will be suspended.

Point scoring

To qualify under the new system, applicants must score 70 points (which is currently the case for Tier 2 entrants). 50 of the points must be from compulsory criteria:

  • Role at appropriate skill level (at least RQF3) (20 points).
  • Job offer from a sponsored employer (20 points).
  • English language (10 points).
  • The salary for the role must be at least £20,480, but no points are awarded.

The remaining 20 points can be made up from the following optional criteria:

  • Salary of £23,040 to £25,599 (10 points)
  • Salary above £25,599 (20 points)
  • PhD in a subject relevant to the job (10 points)
  • PhD in a science, technology, engineering or mathematics (STEM) subject relevant to the job (20 points)
  • Job in a shortage occupation (20 points)

Salary thresholds

In the current scheme Tier 2, applicants must be paid the higher of the Tier 2 category minimum threshold and the “going rate” for the type of job. However, under the new system, the applicant can be paid:

  • 10% lower than the going rate if they have a relevant PhD in a non-STEM subject.
  • 20% lower than the going rate if they have a relevant PhD in a STEM subject or the job is in a shortage occupation.

There will also continue to be a lower salary threshold for applicants considered to be “new entrants” (based on their age or experience in the UK). The new entrant salary rates will be 30% lower than those for experienced hires.

There will continue to be different arrangements for some public sector occupations (including doctors, dentists, nurses, midwives, teachers and social workers), where the salary threshold will be based on published pay scales.

Finally, under the new system, only the applicant’s basic salary will count towards the points criteria, not their allowances or pension contributions.

A route for highly skilled workers

From January 2021, the government will extend the Global Talent route to EU citizens on the same basis as non-EU citizens. Under this route, the most highly skilled migrants, who can achieve the required level of points for this category, will be able to enter the UK without a job offer if they are endorsed by a relevant and competent body.

The government intends to create a broader unsponsored route within the new points-based system to run alongside the employer-led system. This will allow a smaller number of the most highly skilled workers to come to the UK without a job offer. Example characteristics for which points could be awarded include academic qualifications, age and relevant work experience. This route will take longer to implement and is not anticipated to be implemented until 2022, at the earliest.

Lower skilled workers

The government will not be introducing a general low-skilled or temporary work route into the UK.

The new proposals represent significant change for businesses in the UK, the government has said that “employers will need to adjust”. It encourages employers to move away from using the UK immigration system to recruit “cheap labour from Europe” as an alternative to wider investment in staff retention, technology and automation.

Visitor visas

EU nationals will be treated as non-visa nationals, meaning they can come to the UK as visitors for six months without the need to obtain a visa. However, visitors are not permitted to work in the UK.

The visa process

People coming to the UK from any country in the world for the purpose of work or study, other than some short-term business visitors and short-term students, will need to obtain a visa.

Non-EU citizen visa applicants will continue to provide their biometrics (including a digital photo and fingerprints) at visa application centres in their country of application. However, EU citizens will be able to upload a photo of their face using their smartphone and will not need to submit their fingerprints or attend a biometrics appointment as part of their application. This should streamline the application process for EU citizen applicants.

Most EU citizens will be issued with an e-visa under the new system, which confirms their right to be in the UK. They can use the online checking service to demonstrate their immigration status and their rights and entitlements, where permitted, when accessing work and services. For many EU citizens, their status will automatically be available when seeking to access benefits or the NHS.

Non-EU citizens, including those who are the family members of EU citizens, will continue to be provided with physical evidence of their immigration status in the UK, usually in the form of a biometric residence permit.

Right to work checks

Employers can continue to accept passports and national identity cards of EU citizens as evidence of their right to work in the UK until 30 June 2021 which is the deadline for applications under the EU Settlement Scheme.

Crossing the UK border

A fully digital end to end customer journey, similar to the US ESTA scheme, will be introduced in due course. This will require everyone (except Irish nationals) to seek permission to enter the UK in advance of travel to ensure they have permission to do so.

EU citizens, as well as citizens of Australia, Canada, Japan, New Zealand, the United States of America, Singapore and South Korea, who possess biometric passports will continue to be allowed to use e-gates to pass through the UK border either as a visitor or with prior permission. However, migrants should be aware that this can lead to issues when establishing their date of entry to the UK as their passport is not stamped on entry.

Implementation of the new system

The new system will be the only option for applicants from 1 January 2021, however, the government intends to open new key routes from as early as Autumn 2020 on an optional basis.

The second phase of the changes, particularly in relation to the Global Talent category, are expected to be announced next year.

Entitlement to benefits

Currently, EU nationals in the UK can claim benefits if they are “economically active”. Non-EU citizens only become eligible for benefits when they are granted indefinite leave to remain in the UK, which usually requires five years of living legally in the UK.

Under the new proposals, all migrants would only be entitled to access income-related benefits after obtaining indefinite leave to remain in the UK.

EU citizens resident in the UK by 31 December 2020

EU citizens resident in the UK by 31 December 2020 can still apply to settle in the UK through the EU Settlement Scheme until 30 June 2021. Migrants with settled, or pre-settled, status are free to work for any employer in the UK.

Practical implications

Employers and EU citizens will need to bear in mind the following practical implications of these changes:

  • Employers will need to sponsor EU citizens who enter the UK after 31 December 2020 to be able to employ them in the UK. Employers without a sponsor licence should apply for a licence as soon as possible as the Home Office is likely to receive a surge in applications which could delay processing times.
  • With more employees requiring sponsorship in future, the importance of employers complying fully with their sponsor duties is even more significant to avoid their licence being revoked and sponsored workers’ employment being terminated as a result.
  • Recruitment costs could increase significantly from 1 January 2021 as the Immigration Skills Charge (up to £1,000 per year of the visa) and Immigration Health Surcharge (£400 per year for each applicant and their dependants due to increase to £600 in October 2020) will apply to EU citizens as well as non-EU citizens entering the UK for sponsored employment.
  • Employers will need to be conscious of the additional time it will take for an EU citizen to obtain a visa to allow them to work in the UK after 1 January 2021.
  • There is no mention of intra-company transfer (ICT) visas, but we assume that the ICT route will remain open. This route does not currently lead to settlement in the UK, but the major benefit is that ICT migrants are exempt from meeting the English language requirement. However, as allowances will no longer count towards the salary requirement, employers will need to check carefully that the migrant’s basic salary (often paid abroad) will meet the minimum salary threshold requirement.
  • With only 5 months to 2021, employers should consider putting contingency plans in place now to mitigate the risk of not being able to recruit staff as easily from 2021, particularly if they are reliant on lower-skilled workers from the EU. Businesses in sectors such as care, food and hospitality, and construction are particularly exposed.

If you need to discuss any aspect of your preparation for leaving the EU, please get in touch with Imelda Reddington in the immigration team at FSP.