Do UK employers prefer employing foreign skilled workers?
This type of Tier 2 visa is very different to the Tier 2 General (work permit) visa where a cap still exists (though somewhat relaxed recently for certain medics and other skilled staff), and where the UK labour market test is necessary to give British citizens or those settled here (and even EEA nationals) an opportunity to first apply, and only in the event of not finding suitable candidates from the British labour force, to employ from abroad.
It is also different from the Tier 2 general in the sense that unlike that visa category, the Tier 2 ICT is a temporary visa route not leading to settlement. There is a minimum threshold at present of £41,500 in terms of salary. The Tier 2 general salary varies depending on the type of job and skills involved.
Information technology (IT) has brain stormed the globe at a galloping pace, and nothing can operate without it! Many countries are far more advanced that the U.K. in the provision of IT services, but consider the U.K a crucial part of their operations as one of the leading economies of the world. They have therefore established headquarters or subsidiaries of their companies here and regularly transfer skilled employees from abroad to work here. This is both beneficial for them and for the UK as it supports inward investment to the UK. For such foreign companies, the scheme also provides flexibility for senior skilled staff with headquarters or branches in the U.K.
However whilst the Tier 2 ICT has its commercial benefits, there is a point i think to argue that at the same time it has a negative impact on skilled persons from the UK labour force in successfully applying for such posts.
Foreign transferees can bring in to the UK their dependents as well , and with the tax breaks and allowances it becomes very attractive for them and for the UK employers.
Allowances can be classed as part of the salary package, making it cheaper to employ from outside rather than locally. In fact those with an ICT visa can receive an accommodation allowance of up to 30% of their salary if they have a 5 year visa, and 40% for short term graduate trainees allowed to remain for 12 months. Furthermore business expenses for travel, accommodation and subsistence allowance are tax exempt for the first two years of employment .
I think therefore there is an argument in favour of a cap on Tier 2 ICT employees, in order to protect the UK’s IT labour force.
Forget about Brexit for the moment, because like it or not, this uncontrolled visa regime may be one of the reasons why non- EU migration has not been reduced. Those who are Losing out in the process are British or settled workers, or those permitted to work in the U.K. without restrictions, because multinational companies can transfer to the UK employees at a lower cost than that of equivalent experience and expertise available on the domestic market here. Allowances and tax incentives and savings contribute to cost savings when employing ICT workers compared with UK workers.
by Dr Bernard Andonian
Dr Andonian is a guest contributor at Legafit.com. DR Andonian has been a practicing lawyer for over 30 years and also sits as a Judge of the First-tier Tribunal (IAC). He has been at the forefront of legal developments both as a practicing lawyer and a s a Judge, and has demonstrated his unique skills, through his writing, in untangling complex legal phenomenons and distilling them down to basic concepts that can be understood by everyone.