How to protect your business after Brexit

With so much uncertainty about Brexit, many employers are anxious about the status of their EU employees and employment in the future.

The UK is set to leave the EU on 29 March 2019. Even if there is no deal, the Government has made promises that EU nationals living in the UK by 29 March 2019 will be able to stay.

What is the current system?

At present EU nationals don’t need to make any application to the Home Office to be able to stay in the UK. However, it is much easier for them to work, study, rent property and access NHS services.

EU nationals can make an application for a Residence Card or Permanent Residence Card. Residence Cards can be applied for by EU nationals and their family members as soon as they arrive in the UK, as long as they are exercising the free movement rights, e.g. looking for work, working, self-employed, studying or self-reliant. The last two categories require that they have private medical insurance. Permanent Residence Cards can be applied for after the EU national, or their family members, have exercised their free movement rights for 5 years. This category confirms that they can stay in the UK permanently. All EU nationals and their family members must get a Permanent Residence Card before they can apply to become British Citizens. Permanent Residence applications can be made until 31 December 2020. Both applications require a £65 Home Office fee to be paid.

What will the new scheme be?

On 30 March 2019, the EU Settlement Scheme will open nationwide. The Scheme will apply to all EU nationals and their family members, except Irish Citizens. Applications will have to be made by 30 June 2020.

There will be 2 categories:

  1. settled status
  2. pre-settled status

Settled status is similar to the current Permanent Residence. This will be granted if individuals started living in the UK by 31 December 2020, for 5 years in a row. If settled status is granted, the individual will not have to make any more applications to the Home Office. Pre-settled status is similar to the current Residence Card. It will be granted to individuals who haven’t lived here for 5 years continuously when they apply. They can make an application to change to settled status once they have lived here for 5 years continuously.

The new system doesn’t require applicants to show they have been exercising free movement rights. The Government has clarified “residing” only means being physically present and living in the UK. Any EU national who arrives and intends to live in the UK by 20 March 2019 (no deal situation), or by 31 December 2020 (if Withdrawal Agreement goes ahead), will meet this requirement. Applicants won’t be able to choose to apply for a settled or pre-settled status. There will be a Home Office fee of £65 per person aged 16 and over, and £32.50 for children under 16. Applicants in the following categories won’t have to pay a fee:

  • People who have indefinite leave to remain and want to change settled status.
  • Those with a Permanent Residence Certificate.
  • When applying to move from pre-settled to settled status.
  • Children in Local Authority care.

5 Key things you can do to support your EU workers now

Navigating around the minefield of Brexit is a significant challenge for most employers. We have recommended 5 steps you can take to protect your EU employees and continuity of your business:

  1. Do a full audit: Examine all employees to see who made be affected by Brexit. Don’t forget the EU family members who may not have EU nationalities. Make sure you update your right to work checks.
  2. Work with your employees: Explain to your employees they must apply for confirmation of their status. Many of your staff may be unsure when to apply and which scheme is better for them. You mustn’t give them any immigration advice (unless you are regulated to do so) as this is a criminal offence. You can signpost them to the UKVI website, or for more bespoke advice contact our expert Immigration Team to arrange a “no cost-no obligation surgery” at your premises.
  3. Contribute to the fee: You may want to contribute or pay all or some of the Home Office application fee. This is an approach taken by many employers such as Carluccios, various NHS Trusts, Heathrow Airport and universities such as Oxford and Edinburgh. If you choose this option you must make sure it’s offered to all eligible employees to avoid discrimination.
  4. Apply for a sponsor licence: You could consider applying for a sponsor licence, so that you can continue to employ non-EU nationals to fill potential skills gap.
  5. Keep yourself updated: With changes being announced on an almost daily basis you should be aware of these. You can do this by prescribing to Home Office announcements. Alternatively, you can subscribe to our Immigration Team’s simple bright side plain English updates on Twitter, LinkedIn and Facebook.
  6. Don’t panic! Although there is a lot of ambiguity about the process and no one really knows about the impact Brexit has, it is important that employers don’t make any rash decisions that could have a negative impact on their business. This means it’s crucial that you take steps to retain your EU employees and their family members, as well as ensure that your HR systems are up-to-date to protect your business in the future.

It isn’t clear what will happen to employers who continue to employ workers who haven’t applied for confirmation of their status by the deadline. Most likely, they will be considered to be in the UK unlawfully and under current laws, employers could face heavy fines (up to £20,000 per employee) and face criminal conviction for continuing to employ them.