On 16 February, the UK Border Agency (UKBA) released a Statement of Intent detailing proposals to change the eligibility criteria for the Points-Based System (PBS) Tier 2 migrants and the operation of permanent limits on certain Tier 2 applications.

Additionally proposals to change the criteria for indefinite leave to remain (ILR) for Tiers 1 and 2 and work permit-holders were made.

These changes will come into force on 6 April, including the final closure of the Tier 1 (General) category. Increases to application fees have also been proposed due to the need to cut public spending.

The coalition’s overarching aim for UK immigration is to reduce net migration by ‘selecting the best and brightest’. To help achieve this, UKBA proposes to raise the qualifying thresholds for the Tier 2 category and cap the number of Tier 2 (General) migrants at an annual limit.

Moreover, restrictions will extend to the requirements for settlement in the UK to implement the government’s ‘less automatic settlement’ agenda.

UKBA was expected to publish the new rules and formal guidance at the time of going to press .

Proposals for Tier 1The final closure of Tier 1 (General) on 6 April will deal a huge blow to both employers and individuals alike. After the dubious operational assessment of the category last October, which purported to find that 29% of Tier 1 migrants were in unskilled jobs (the report was based on solely Tier 1 dependants who had been in the UK for six months), UKBA believed it had justification to delete the entire highly skilled migrant category.

At least there will be transitional provisions in place for those who will be submitting eleventh-hour Tier 1 (General) applications by post, so that their applications will be assessed in accordance with the rules in place on the date of application (the date the application is posted).

Under the transitional arrangements, migrants who are not already in Tier 1 (General) or its predecessor category, the highly skilled migrant programme, will not be permitted to switch into this category from 6 April 2011. The Tier 1 (General) route will remain open to allow those with existing leave to enter or remain under Tier 1 (General), or its predecessor, to extend their leave.

However, the points threshold for extensions will be raised to 100 points for those who required 100 points when first granted leave.

It is feared by immigration practitioners that the Tier 1 (post-study work) category may survive the changes only to be phased out after the new rules are implemented. Generous transitional provisions are anticipated if so.

On a positive note, there are proposals for those recognised with ‘exceptional talent’ from different sectors to be certified as ‘exceptionally talented’.

It will be decided that a migrant meets the ‘exceptionally talented’ criteria by bodies who have been delegated the power to certify migrants. The UKBA is yet to give definitive criteria for what will amount to ‘exceptional talent’.

Unsurprisingly, a Nobel prize winner will be viewed as such. The proposals need to be built upon and it is still unclear how the capped allocation of 1,000 migrants for each sector will be managed, let alone how UKBA will deal with an undoubted ‘oversubscription’ to the category.

Proposal for reform of the Tier 1 – (Entrepreneur) and (Investor) categories have not yet been published but future (skilled) changes are thought to be nominal.

Proposals for Tier 2As the main category for sponsored skilled workers, Tier 2 migrants require a Certificate of Sponsorship (COS) from their licensed sponsor. These will be divided into ‘Restricted’ and ‘Unrestricted’ COSs.

From 6 April onwards the ‘Restricted’ COS will be capped at an annual limit of 20,700, 4,200 of which will be available for the first month and 1,500 available thereafter. It is proposed that if a monthly limit is undersubscribed, the balance will be added to the allocation for the following month.

If the monthly limit is oversubscribed, applications will be prioritised on the basis of a new points table. Much like the old work permit scheme, which ironically the PBS was supposed to displace, sponsors will need to apply to the monthly panel for a ‘Restricted’ COS each time they wish to sponsor a migrant under Tier 2 (General).

This points system will prioritise occupations on the new shortage occupation list followed by occupations at PhD level and then occupations meeting the resident labour market test (RLMT).

Points will also be awarded for salaries ranging from £20,000-£20,999 with further points for salaries of £100,000 to £149,000. Persons in occupations with salaries of less than £20,000 will be unable to meet the minimum points required.

‘Unrestricted’ COSs are only available for the Tier 2 categories unaffected by the limit.

These fortunate few include intra-company transfers, Tier 2 migrants extending with their original employer or switching to a new employer, migrants switching into Tier 2 (General) from a permitted category, applications under transitional arrangements for existing Tier 2 and work-permit holders, positions with a salary over £150,000 and Tier 2 sports people or ministers of religion.

Sponsors will be given an initial annual allocation of ‘Unrestricted’ COSs based on UKBA’s consideration of their allocation requests.

These surprisingly generous provisions should enable sponsors to continue employing migrants who: are extending their leave with their original employer; switching into Tier 2 (General); or are intra-company transfer migrants, without the worry of a salary assessment (as there is for ‘Restricted’ COSs).

The consequence will no doubt be a rush of annual allocation requests from sponsors who had been stripped of COSs under the previous interim limits. Immigration practitioners are concerned that UKBA may not have made provision for this.

As the new graduate occupations list and shortage occupation list are compiled, some occupations are expected to be dropped from the ‘skilled’ threshold.

Positions previously on the shortage occupation list may be removed as they do not meet the new graduate-level criteria. Nevertheless, provided the minimum salary levels are defined clearly and the lists compiled in accordance with the Migration Advisory Committee (MAC) recommendations, some positions may be elevated to the new ‘skilled’ level by virtue of the migrants’ previous experience being equivalent to graduate level.

This will apply to all migrants across the board for both ‘Restricted’ and ‘Unrestricted’ COS.

Another wholesale change proposed for the Tier 2 category is the increased English language requirement to intermediate English at level B1 on the Common European Framework of Reference for languages. Furthermore, Tier 2 entry clearance applicants will no longer be able to claim points for qualifications.

SettlementMigrants submitting applications for ILR in the UK on or after 6 April 2011 will be affected by the changes to settlement to be introduced on that date.

The changes will introduce a new income requirement for Tier 1 (General), Tier 2 (General) and work permit-holders applying for settlement; will amend the Knowledge of Language and Life in the UK requirement for Tier 1 (General), Tier 2 (General) and work permit-holders; and will clarify the criminality test applied to all applicants for settlement. UKBA’s proposals to tighten settlement requirements bear, on closer inspection, a likeness to the outgoing government’s ideas (published in the Path to Citizenship green paper on 20 February 2008) for selecting migrants with ‘the right values and commitments’ who would integrate into British society.

There is one key difference however, as there appears to be no inclination to mimic the ‘earned citizenship’ ­proposal.

Unfortunately, as changes are proposed for Tier 1 and Tier 2 categories UKBA has failed to align its proposals with settlement rules and nationality law.

For instance, the lure of ‘accelerated settlement’ for Tier 1 (Entrepreneur) and Tier 1 (Investor) migrants who invest more money into the UK do not factor in the requirement of continuous residence in the UK under settlement rules which most entrepreneurs and investors will not be able to meet. UKBA has remained silent on this matter, but it is evident that primary legislation may need to be amended accordingly.

ConclusionUKBA’s aim to create a ‘flexible system designed to meet business needs’ as well as reducing net economic migration may seem almost impracticable but may indeed be achieved in part.

Though it is a difficult balancing act, it cannot be denied that many potential applicants will now fall foul of the higher thresholds established, resulting in a net reduction in migration.

It remains to be seen whether the new rules will prevent businesses from employing as many non-EEA migrants as required or whether businesses will remain unscathed.

Hannah Batchelor, a legal assistant, contributed to this article