How will Brexit affect businesses that employ European workers?

November 30, 2020
Vitoria Nabas


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In the latest of our series of articles on Brexit and the changes we can expect come 1st January 2021, Partner Vitoria Nabas looks at the implications and considerations for UK businesses who employ European workers.

With less than a month to go before the UK finally and formally leaves the EU at the end of the transition period, it’s important for businesses to be aware of a number of things if they employ European workers. Some of the key questions businesses should have asked themselves, or be asking right now, include:

  • Have you carried out a risk assessment of your employee pool?
  • Are your resources ready for a change of employees?
  • Have you considered that hiring European “unsettled” employees will require a Sponsor Licence?
  • Are your workers, who are European citizens, recognised under the Settlement Scheme, with an Indefinite Leave to Remain stamp on their passport?

Let’s look at that in a touch more detail.

Risk assessments

UK and non-UK businesses based in the UK must audit their current workforce. European Economic Area (EEA) nationals and visa holders should be checked to ensure they have properly applied, under the Settlement Scheme, to remain in the UK after Brexit. And, just to be really clear, this check is not just for the employee, it is needed for any people whose visa is dependent on their relationship status to an employee. This includes spouses, children and other family members.

The good news is that if they haven’t done this yet, there is still time. They have until 30th June 2021 to make an application, otherwise they will not be able to live and work in the UK without obtaining a visa.

It’s worth noting that businesses can request a Home Office Share Code from their employees (and their family members) who are EEA Nationals. This code allows you to confirm the immigration status of employees on the UK Border Agency (UKBA) website.

The end of the transition period

From the 1st January 2021, businesses who wish to hire EEA Nationals will have new requirements. Along with those people who have a visa, EEA Nationals will be required to have a pre or settled status in the UK to live and work. Businesses must check an individual’s immigration status in the UK.

Moving forward, the hiring of EEA Nationals without a settlement status will be the same as hiring a foreign worker. Businesses will need to apply for a Sponsorship Licence and the EEA National will be required to have a visa to live and work in the UK.  For the avoidance of doubt, from the 1st January, foreign staff includes EEA Nationals and family members who have not arrived before 31st December 2020 and not applied under the Settlement Scheme until 30th June 2021.

Obtaining a Sponsorship Licence

It is crucial to know that obtaining a Sponsorship Licence is a lengthy process. It can easily take eight weeks for approval to come through from the submission date. Businesses should also be aware that they will be required to provide a huge amount of supporting documentation and information. They will need to do this for each foreign worker separately.

What happens if businesses get it wrong?

Penalties for getting this wrong can be significant. They include fines of up to £10,000 per person and criminal convictions for Company Directors. So, it pays to make sure everything is in order, both now and moving forward.