As the holiday season gets under way, one of the biggest challenges for many hospitality businesses continues to be getting the operational staff needed to run the business at the busiest time of the year. In this article, Jacqueline Moore, Immigration Partner recommends three ways to fill positions by using the UK immigration system to employ international staff.
As of 1 January 2021, the only citizens with an automatic right to live and work in the UK are British and Irish citizens. Everyone else needs a visa. Some visa holders hold their own immigration permission, for example they could be here on a partner visa or an ancestry visa. Some visa-holders have blanket permission to work, meaning they can work for any employer in any role, while others have restricted work rights. For those who do not hold their own immigration permission, sponsorship will be the only means of employment, but more on this later. For now, let’s concentrate on those international staff that can be employed without sponsorship.
Option One: Filling roles with international staff who do not require sponsorship, including using international students to fill temporary roles in the vacation
As many employers will be aware, most international students have restricted work rights. Undergraduate students can work up to 20 hours during term-time and full-time during vacation. Last year, according to figures sourced from Universities UK, the Home Office granted 463,315 sponsored study visas, which is the highest number of study visas granted on record and an increase on pre-pandemic levels. Whilst a proportion of this cohort will return home during vacation, some students will choose to stay in the UK, and could work full-time during their vacation period. For employers, looking to access this potential recruitment pool, one way to gain access would be by contacting Colleges and Universities who are listed on the register of licensed sponsors: students to find out if they would be willing to advertise summer job vacancies.
However, employers hiring international students (including EU students) will need to be mindful of carrying out the appropriate Right to Work Checks. They must also ensure they do not employ the student full-time at any point during term time.
In an update to the Employer's guide to right to work checks, on 28 February 2023, the Home Office clarified a number of issues in respect of the employment of students. Firstly, the student’s vacation time is treated as starting the day after the educational institution’s term time ends. Therefore, if term ended on a Friday, full-time work would be permitted from the following Saturday. Employers should ask the student to provide verifiable evidence of when the term ends, and should also check this against the information on the education provider’s website.
Secondly, employers need to be aware that students cannot fill permanent full-time vacancies unless two exceptions apply. The first exception is for students who have successfully completed their course and applied for a Graduate visa. These students can take up a full-time position whilst their Graduate visa application is in process. A Graduate visa lasts 2-3 years, although this time does not count towards a settlement visa. However, some employers and employees find that the Graduate visa offers a useful trial period for both parties. If the employee is a good fit, the employer can then sponsor the employee at a later date.
The second exception is where the student has applied for a Skilled Worker Visa, in this scenario, the student can work full-time providing they have made a valid application to stay as a Skilled Worker and this application has been made within 3 months of the course completion date. This option is only available to employers who hold a sponsor licence, which leads us on to look at the second option: recruitment through sponsorship.
Option Two: Recruiting through sponsorship
A sponsor licence is a licence issued by the Home Office, which enables employers to recruit international staff. The employer applies for a sponsor licence and, once the licence is in place, they can issue a Certificate, known as a Certificate of Sponsorship (CoS). The prospective employee then applies for a Skilled Worker Visa using the CoS. The Skilled Worker visa is the Home Office’s flagship visa and is a re-branding of the Tier 2 visa with greater flexibility for employers.
A sponsor licence involves an investment in both time and money, although not perhaps as much as some might think. The cost of applying for a sponsor licence, which lasts for 4 years, is £536 for a small business and £1,476 for medium or large businesses. The employer must also comply with a number of sponsor duties in exchange for the benefit of holding a sponsor licence.
Our clients who hold sponsor licences report a number of benefits. The first benefit is very high retention rates; although sponsored workers can change employers, the fact that a visa application is required acts as a disincentive. Secondly, sponsored employees are permitted to do overtime for their sponsored employer, providing that the overtime is paid at the same rate or higher than the rate stated on their Certificate of Sponsorship. Employers report that sponsored workers are in general very willing to do overtime and provide emergency/sickness cover for colleagues when needed. Thirdly, many employers report that having sponsored international staff brings fresh ideas into the business and promotes their organisation’s wider diversity strategy. Lastly, a number of larger hospitality businesses have found sponsorship invaluable for recruiting chefs and spa managers, which have both been hard-to-fill roles following the end of free movement.
Despite the benefits, uptake of sponsorship in the hospitality sector has been slower than in other sectors. There are a number of reasons. Firstly, not all hospitality sector roles are sponsor-able; many roles do not meet the skills threshold for sponsorship. To be eligible for sponsorship, a role must be assessed as requiring a skill level set at Level 3 or above on the Regulated Qualifications Framework (RQF). This is a role assessed as requiring a level of education equivalent to A Level/Scottish Highers. Official figures reveal that 63% of hospitality roles are ineligible for sponsorship, while 37% are eligible. Currently, the following hospitality sector roles can be sponsored: chefs (all levels), bar managers, catering managers, floor managers (restaurant) and health and fitness managers. Roles that are not sponsor-able include, waiters (including head waiters), bar staff and beauty therapists.
Recently, the UK Government commissioned the Migration Advisory Committee (MAC) to look at adding ineligible hospitality sector roles on to the Shortage Occupation List (SOL). Roles on the SOL can be of a lower skills threshold and still qualify for the Skilled Worker visa. They also benefit from lower visas fees and lower salary thresholds. Last year, the UK Government accepted the MAC’s recommendation to add “carers” to the SOL, as they were satisfied that an exceptional case had been made of a genuine shortage of workers. However, unfortunately for the hospitality sector, the MAC recently rejected the calls for more hospitality sector roles to be added to the SOL. This was on the basis that they were not satisfied that there was exceptional and strong evidence that this was required.
One small crumb of comfort for hospitality businesses in the MAC’s interim report on Construction and Hospitality Shortage Review is that the MAC advised that they were prepared to consider, as part of the fuller review, whether the skill level for Sommeliers should be increased. The proposal is for Sommeliers to be re-categorized from RQF Level 1-2 to Level 3, making them eligible for sponsorship. The MAC has invited stakeholders to make representations in relation to this proposal.
In view of the skills threshold issue, obtaining a sponsor licence won’t be for everyone. However, it may be worth considering for businesses who are struggling to fill sponsor-able roles.
Another important point to flag is processing time-scales. The Home Office is currently receiving applications for sponsor licences at the rate of 500 new applications per week, with a standard processing time of 8 weeks. There is a priority service, but only 30 new businesses a day are lucky enough to obtain this. The priority service operates on a first-come first-served basis, and slots open at 9 am, with only those applications arriving bang on the hour having any chance of success.
Once the licence is granted, there are further processing times and costs to consider in connection with the prospective employee’s Skilled Worker application. There are costs that must be borne by the employer in this process, including £199 to issue the Certificate and there is also an Immigration Skills Charge (ISC). The ISC is an employer levy and costs vary depending on the size of the business. A small sponsor pays £364 per year of the visa, a medium or large sponsor pays £1000 per year. There are then visa fees and fees to use the National Health Service. These fees can be subsidised by the employer or paid for by the employee, and practice varies widely across businesses and sectors. Skilled Worker visas take, on average, anywhere between 3-8 weeks to be processed.
Option three (for sponsor licence holders only): advertise roles as sponsor-able
A final practical option worth considering is to advertise the roles as being sponsor-able. Clearly this only applies where the business has decided that they are prepared to pay the costs of sponsorship. Clients frequently tell us that obtaining a sponsor licence and being listed on the register of licensed sponsors can result in approaches from potential new hires. Some businesses decide to go one step further and will advertise as part of their recruitment process that they hold a licence and can sponsor the prospective employee.
Businesses also find that many sponsored workers become a source of recruitment, bringing in family and friends from their home country who are looking to live and work in the UK. Many businesses choose to incentivise this by operating staff commission schemes.
For the hospitality sector, the end of free movement has been very impactful on business operations. No immigration system will ever be as good as free movement. However, there are options out there. For all businesses, there is a substantial number of international students who can work full-time during the busy summer season, although care must be taken to carry out right to work checks. For those who have obtained a sponsor licence, sponsorship is a long term investment which brings substantial benefits. Those considering an application for a licence can rest assured that significant numbers of businesses find that the advantages outweigh the costs and red tape involved.
