White Paper spells significant UK immigration changes for employers

On Monday 12 May, the government published its much-anticipated White Paper on “Restoring Control over the Immigration System”.

The paper sets out a number of reforms aimed at reducing net migration, increasing the focus on upskilling and utilising the domestic labour market in place of overseas talent, whilst increasing the integration of legal migrants in the UK. If implemented many of these changes could impact employers in terms of accessing the talent they need. This will be a balancing act for the government, to ensure the UK can remain an attractive destination for business and top talent, achieve clean energy and infrastructure objectives and maintain social care, whilst controlling net migration levels.

The government’s overall plan is for labour market policies to be informed by a stronger evidence based approach. A new Labour Market Evidence Group will be established that will gather evidence on issues such as domestic labour market participation, skills, training levels and industrial strategy and make recommendations for workforce strategies.

The proposals in the paper focus on legal migration to the UK. It is worth noting that the paper is essentially a statement of intent. Implementing these changes will require legislation, rule changes and, in some cases, prior consultation. We have no details of implementation dates yet, and await the finer details, but employers would be sensible to consider the impact these changes, if implemented, will have for them and plan ahead now.    

We have summarised below the key plans outlined in the paper for employers to be aware of.

1. Reduced reliance on immigration for skills shortages

   • If you want to recruit workers from overseas, you will be expected to invest in the skills of workers already in Britain. Sectors heavily reliant on skills from abroad will have to produce / update a workforce strategy (looking at things like skills, training, conditions of work and the engagement of the inactive domestic work force) which relevant employers will have to comply with. None of these things are quick fixes, but it is clear sectors using overseas labour will be expected to develop plans to reduce that reliance.

2. A return to pre-Brexit skills thresholds for skilled worker visas

   • Roles will have to be at graduate level (RQF 6) to qualify for sponsorship. Part of the rationale behind this is that lower skilled roles are considered quicker and easier to train people for. Even at RQF 6, employers may not have unfettered access to the points-based system. The new Labour Market Evidence Group will keep that under review and may make recommendations on how to tackle labour shortages, to reduce any over reliance on migrant workers.

   • This will remove around 180 roles from qualifying for skilled worker visas. Whilst classic roles such as those in finance, engineering and IT will not be impacted by this change, it is expected to spell the end of sponsorship for many roles that had been eligible in the retail, hospitality and construction sector, as well as those in the maritime sector involved in projects such as offshore windfarm development. This will be of concern to affected employers and developers of large projects and calls into question how such a change aligns with the UK’s wider clean energy and infrastructure objectives, for example, particularly where such roles are often transitory in nature. If implemented, the new Temporary Shortage List (see below) will be hugely important to those impacted.

   • This won’t apply to those already in the UK on skilled worker visas before the changes come into place. They are expected to be able to renew their visa, change employment and take supplementary employment in roles below RQF 6. Those applying from overseas or looking to switch category in-country (e.g. graduate visa holders) would have to comply with the new rules when they are in force though. As such, we predict a surge in sponsorship and visa applications (as we saw ahead of the April ’24 changes) by employers and individuals seeking to beat the changes. Similarly, those already on skilled worker visas ahead of the changes could become hot targets for recruitment on more favourable terms.

   • This will undoubtedly affect some sectors harder than others. One positive which may come from this is to relieve employers from some of the difficult considerations around sponsorship requests. Many of our clients have faced increased sponsorship requests since Brexit, often for roles at a lower skill level and which they can easily fill from the UK market. Since the resident labour market test was abolished, such requests have thrown up challenging indirect discrimination considerations. For those employers who do not wish to incur the costs of such immigration processes, the increased skills threshold would potentially be a welcome development.

3. Adult social care

   • Social care visas will be closed to new applications. Until 2028 visa extensions and in-country switching for those already in the UK with working rights will be permitted but kept under review.

4. Out with the old, in with the new (again)….Immigration Salary List to be abolished

   • We previously had a shortage occupation list, detailing roles considered in short supply and for which immigration was a partial solution. Roles on that list were granted discounts on the general threshold salary and going rate applicable to them. That was then replaced with the much shorter immigration salary list. Roles on that list are given a discount on the general threshold salary payable, but not the going rate for the role. That is now to be scrapped.

   • A new Temporary Shortage List is to be created. Roles below RQF 6 will only qualify for skilled worker sponsorship if they make it on to this new list, and their inclusion will be temporary. Roles may be added if they are key to the UK’s industrial strategy, following advice from the Migration Advisory Committee, and if there is a workforce strategy in place and employers are committed to increasing domestic recruitment. Any such roles will come with restrictions on bringing dependants to the UK.

   • It remains unclear whether inclusion on the new list will bring any salary discounts, and we understand this is something the Migration Advisory Committee will be asked to look at.

5. Increased salary requirements

   • The paper references increased salary thresholds being introduced but no further details are provided on this yet, including whether that would involve changes to the general threshold and/or the going rates for roles.

   • The expectation is that salary thresholds will increase for all visa holders seeking to bring dependants to the UK.

6. English language

   • New English language requirements are to be applied across a broader range of immigration routes, for main applicants and dependants, including an assessment of improvement over time.

   • Skilled workers and those where a language requirement already applies, will see a threshold increase from level B1 to B2 on the Common European Framework for Reference.

   • A new language requirement will be introduced for all adult dependants of workers and students at level A1 (basic user), which will be increased over time.

   • Requirements to demonstrate progression to level A2 (basic user) for any visa extension, and B2 (independent user) for settlement are to be introduced.

7. Higher costs – immigration skills charge

   • The immigration skills charge (“ISC”) is set to increase by 32% in line with inflation.These additional funds are to support skills funding for priority sectors to upskill the domestic workforce.

   • The current ISC is £1,000 per year paid upfront for large sponsors. The increase will raise the ISC for a 3-year sponsorship from £3,000 to £3,960. As noted below, given businesses will be facing sponsoring workers for 10 years to get them to settlement, this increase (along with prohibitions on recovering such costs from applicants), may well rule some businesses out of the points-based system, making it more challenging for them to compete in the global market. We would anticipate this increase hitting harder in the UK’s regions and on SMEs.

8. Settlement

   • This is one of the most significant changes proposed.

   • Settlement is the first step to becoming eligible to apply for British citizenship. At the moment settlement is achieved through sufficient continuous residence in the UK and a knowledge of life in the UK test. For skilled workers, after 5 years’ continuous residence they may apply for settlement. The government intends to reform the rules to ensure that individuals “earn their right to privileged immigration status in the UK through the long-term contribution they bring”.This will see an increase in the qualifying period from 5 years to 10 years.

   • Individuals will potentially be able to reduce that qualifying period based on “points-based contributions to the UK economy and society”. Consultation on that is expected later this year. It remains to be seen how one’s contribution will be assessed and whether that will be primarily based on their salary. Further, the paper does not say what impact this change may have on those already in the UK on skilled worker visas ahead of these changes, which will be a key concern for employers and employees alike.

   • A typical family of four currently seeking visas under the skilled worker route for 5 years will generally have to pay over £24,000 in visa fees and the immigration health surcharge. This change will see them having to pay upwards of £48,000 to accrue the required continuous leave for settlement. Questions have been raised about the impact this may have on the UK’s reputation and attractiveness as a destination for top talent, as well as on businesses seeking to develop and expand.

9. British citizenship

   • Eligibility for citizenship will be reformed to align with the settlement changes referenced above, increasing the standard qualifying period and expanding the points-based system to allow those with greater contributions to qualify sooner. Those with greater contributions to the UK economy and society will potentially qualify for citizenship sooner. Again, how contributions will be assessed remains to be seen.

   • The Life in the UK test is also to be refreshed.

10. Simplification and compliance focus

    • Where visas are required, apparently the process for employers and workers will be streamlined to reduce bureaucracy and support growth. Amid concerns about worker exploitation and modern slavery, the government will explore further reforms to the sponsorship system, putting more responsibility and accountability on effective and responsible sponsors. That will include potentially make it easier for sponsored workers to move between licensed sponsors during the period of their visa, giving them more control over who they work for.

    • Employers should expect a continued increase in resources focused on illegal working (particularly in key sectors where higher incidences occur), through the use of eVisas and modern biometric technology to support raids. 1,000 staff have already been deployed into enforcement and returns since the election.

    • The rules applicable to major banks to prevent illegal working are to be extended to other financial institutions.

    • The Home Office intends to work with HMRC and HM Treasury to apply immigration enforcement measures to those applying for visas, or here on visas, who have not paid taxes owed in the UK.

11. Graduates

    • Amid concerns about the number of graduates remaining in the UK after their studies and not moving into graduate level roles, the government intends to reduce the period graduates can remain in the UK for to 18 months. This will be concerning for the higher education sector, among others, given the economic need to attract international talent to study in the UK.

12. Global talent:

• Amid the restrictions trailed in the paper, there are some relaxations. The government has stated an intention to ensure the very highly skilled have opportunities to come to the UK and access targeted routes for the brightest and best global talent. This will be done by:

  • Increasing places for research interns, including those working in the field of AI, to allow businesses access to promising young talent

  • Making the Global Talent Visa easier for top scientific and design talent to access

  • Reviewing the Innovator Founder Visa, to ensure it supports entrepreneurial talent studying at UK universities to move into the visa so they can build their business and career in the UK

  • Doubling the number of workers an overseas business can send to the UK under the UK Expansion Worker Visa to establish a presence in the UK

  • Doubling the list of eligible overseas universities from which graduates may seek a High Potential Individual Visa, to work in the UK without employer sponsorship. The HPI visa can be a useful option for employers to consider and so this will be welcomed if it helps employer access talent without sponsorship. It is interesting that, if the visa term is held at the current two years, this would put graduates of overseas universities at an advantage over those from UK universities given the above graduate visa changes planned. 

  What can employers do now?

• Keep an eye out for consultation opportunities to help shape these reforms. If your sector is facing acute labour shortages it will be important to make that known, particularly as the Temporary Shortage List will be shaped around such information.

• Consider your workforce – can you expedite any extensions for sponsored workers to avoid an increase in the ISC? Do you have employees approaching settlement eligibility? If so, ensure those applications go in where possible ahead of the requirements changing. Similarly, existing employees on other visas should be considered if you wish to sponsor them ahead of the rule changes (e.g. to avoid increased costs and the skills threshold increasing). Graduate visa holders can switch at any point, they do not have to wait until the expiry of their graduate visa.

• Consider your recruitment pipeline, particularly if that includes roles below RQF 6 which you struggle to fill. You may wish to expedite any required sponsorship and visa applications to get in ahead of rule changes.

• Remember to consider alternative routes for particular individuals if sponsorship is ruled out and a permanent solution is not needed (e.g. youth mobility visas, global business mobility routes such as senior or specialist worker).

• Look at your upcoming projects, plans and budgets and consider how these changes may impact them.

• Consider how you, and your wider sector, can increase recruitment and engagement from the domestic labour force.

Our business immigration team will continue to monitor developments in this area and keep our clients updated. If you have any questions on the changes announced and how they may affect your business, please contact the team.

This publication is intended for general guidance and represents our understanding of the relevant law and practice as at May 2025. Specific advice should be sought for specific cases. For more information see our terms & conditions.