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Supporting Employees with UK Visa Fees: Costs, Benefits & Clawbacks

UK Visa applications fees are becoming increasingly costly; the visa fees for a Skilled Worker visa for five years can exceed £12,000 for the main applicant. The importance of hiring skilled workers to assist in an entity’s growth and success versus the upfront cost of doing so creates a nexus.

A key decision for employers is consideration of the financial level of support provided to current or prospective employees hired under a skilled worker sponsorship licence.

Overview Of Fees

For most UK work related visa application, Government fees constitute the majority of the total costs, usually these fees will exceed professional legal fees. Government fees include the visa application fee, the Immigration Health Surcharge (IHS), the Certificate of Sponsorship (CoS) fee, and the Immigration Skills Charge (ISC). Other optional fees include priority services fees to expedite a visa application.

The Level Of Financial Support Provided By Employers

Whilst many employers will have a well-established policy in place to guide them, many employers do not. The extent of support that an employer can offer to provide can range from, the employee covering all of the fees (that they are legally required to pay) to employers paying for all of the fees associated with the visa application.

Many Employers Adopt An Ad-Hoc Approach and Base Their Decisions Upon A Varity Of Factors Such As:

• Seniority of the employee
• Their skill-set
• Their shortage in the employment market
• Departmental budgets
• The demand for the employee against business needs

Employers Take One Of The Following Approaches Generally:

1. Covering the full costs associated with the immigration application for the employee. Some employers will also cover the costs of the employee whilst others will not.
2. Paying only the professional fees and requiring the employee to cover all of the other costs that can legally be passed on.
3. Paying the mandatory fees in order the employee to be employed but not enhanced fees such as priority service to expedite an application.
4. Requiring a minimum length of service with clawbacks if the employee leaves prematurely.

Important Considerations For Employers

1. Employers need to consider, socio-economic factors such as labour trends along with inflation rates, shortage of talent, the cost-of-living crisis, employee morale and well-being.
2. There have been instances of employees rejecting or withdrawing from job offers over a lack of agreement as to who will pay the visa costs. It is important for relocation packages to balance the cost of visa fees with the ability to attract and retain talent critical to an entity’s success.
3. Employers should be duly advised as to the legal options available to them to protect their investments in respect to visa applications. Employers can insert a minimum service length clause. This means, if an employee leaves before reaching the requisite length of service the employer can clawback a percentage of the visa application fees.
4. It is important for employers to be consistent with the level of support that they offer. A case-by-case approach can lead to an imbalance in employee morale and give rise to potential discrimination claims.

Clawback Clauses

If an employer intends on inserting a clawback/repayment clause into their contract, they will need to consider the following relevant points:

• The rule against penalty clauses in the event of a breach of contract (an individual signs the contract and begins the visa process but does not commence employment);
• The principles surrounding restraint of trade (where there is no breach but the individual leaves within a few weeks or months such that the employer has not had the ‘benefit’ of the financial investment made;
• Discrimination.

To avoid any attack on the enforceability of a repayment clause, the contractual term must be proportionate. A ‘sliding scale’ based upon a greater reimbursement if an employer leaves sooner rather than later will be an important element to increase the prospects of the term of the contract being enforceable.

Conclusion

Hiring highly skilled individuals to grow or enhance your business is a primary aim when employing an individual from abroad. The initial outlay in visa application costs can be daunting. However, in our experience clients with a well-prepared policy or agreement in place, should the intended hire fail to commence work or leaves prematurely mitigate the cost risks associated with sponsorship.

Quastels

Our corporate immigration team can provide holistic legal advice across employment and immigration law. If you require advice or assistance in preparing a clawback or repayment agreement, contact Jayesh Jethwa at corporateimmigration@quastels.com

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Sponsorship Licences: a viable solution to the workforce shortage in the post-Brexit era.

Since the United Kingdom’s decision to leave the European Union, the nation has been grappling with the challenges of a new immigration system. Consequently, businesses across various industries have faced a significant shortage of skilled labour.

To address this issue, sponsorship licences have emerged as a viable solution. It enables UK firms to attract and retain talented professionals from around the world. In this article, we will explore how sponsorship licences offer a promising path forward to mitigate the workforce shortage in the post-Brexit era.

The Post-Brexit Workforce Shortage

Brexit has led to the end of the free movement of people between the UK and the European Union. For this reason, this change has had a significant impact on the availability of foreign workers in the UK. Which leaves many industries struggling to fill key roles. Correspondingly, sectors such as healthcare, technology, finance, and engineering have been particularly affected by this shortage. To ensure the continued growth and success of these industries, it is imperative to find innovative solutions.

Enter Sponsorship Licences

Sponsorship licences have become a lifeline for UK businesses in need of skilled workers from outside the country. Under the sponsorship system, employers can apply for a licence to sponsor individuals from non-UK and non-European Economic Area (EEA) countries. This allows businesses to recruit talent from a global pool of professionals who possess the necessary skills and expertise.

Benefits For Employers

• Access to a wider talent pool: Sponsorship licences enable UK firms to access a vast international talent pool. Which ensures they can hire the best candidates for their organisations. By removing geographic restrictions, businesses can attract individuals with specialised skills and experience that may not be readily available locally.
• Retaining skilled workers: Sponsorship licences allow businesses to support the long-term residence of foreign employees. Which reduces turnover rates and retaining valuable talent. This stability positively impacts productivity, innovation, and the overall success of the organisation.
• Meeting specific industry needs: Certain industries require specialised skills that may not be adequately fulfilled by the local labour market. Sponsorship licences allow businesses to bridge this gap by recruiting professionals from overseas who possess the desired expertise. Thereby ensuring continued growth and competitiveness.

Benefits For Employees

• Professional opportunities: Sponsorship licences offer individuals the chance to pursue rewarding careers in the UK. Skilled professionals can explore new horizons, gain international experience, and contribute to the growth of UK businesses, all while enjoying the benefits of living and working in a culturally diverse environment.
• Security and stability: The sponsorship system provides foreign workers with greater security and stability. With a sponsorship licence, employees have the reassurance of being employed by an organisation committed to supporting their immigration status, providing peace of mind for themselves and their families.
• Skill development and growth: Working in the UK under a sponsorship licence allows individuals to enhance their skills and professional networks, opening doors to future career opportunities both in the UK and beyond. This exchange of knowledge and expertise contributes to a vibrant and diverse workforce.

Conclusion

In the face of the workforce shortage brought about by Brexit, sponsorship licences have emerged as a viable solution for UK businesses. These licences enable organisations to tap into a global talent pool and attract skilled professionals from around the world. By utilising sponsorship licences, businesses can bridge the skills gap, foster innovation, and maintain their competitiveness in the post-Brexit era.

Moving forward, it is crucial for UK firms to embrace sponsorship licences as an essential component of their talent acquisition and retention strategies. By doing so, they can navigate the challenges of the new immigration system and continue to thrive in an increasingly globalised and interconnected world.

Finally, to find out how we can assist you on all matters relating to Sponsorship Licences and Corporate Immigration. Please contact Jayesh Jethwa to make an appointment.

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