Skilled migrants earning under £35,000 to be deprived settlement

Skilled migrants will only qualify for Indefinite Leave to Remain (ILR), also known as settlement, in the future if they are earning a minimum salary. The Home Secretary has announced the plan as a move towards creating a temporary migrant workforce in the UK.

The new rules will mean that any skilled worker who has been in the UK for five years will now need to earn at least £35,000 per annum in order to qualify for ILR. It is expected that there will be some exceptions to the limit, including a lower earnings threshold for jobs in shortage or at PhD level.

Temporary permission to enter and remain in the UK will also be capped at 6 years, to reduce access to ILR through the long-residence channel (after 10 years in the UK).

The changes in settlement rights will also include a new rule removing the rights of overseas nannies, cooks and other domestic workers to settle in Britain after five years. In 2010, 15,700 visas were issued to foreign domestic workers from outside Europe. The new rules mean that in future they will only be able to work for foreign visitors and their period in Britain will be restricted to six months.


In his press release on the UKBA website the Immigration Minister, Damian Green, provided these clarifications about who will be exempt from the salary requirement:

  • those who enter as PhD-level scientists and researchers who will not have to meet the £35,000 minimum salary threshold
  • make all workers in shortage occupation jobs (currently including specialist nurses, teachers and social workers) exempt from the minimum settlement salary threshold of £35,000
He also took the opportunity to make other general statements about the government’s forthcoming plans for the settlement system:
  • the UKBA will continue to provide a direct route to settlement for investors, entrepreneurs and exceptionally talented migrants under Tier 1
  • The UKBA will continue to provide a route to settlement for the best Tier 2 migrants, if they meet a minimum salary threshold of £35,000.
  • Tier 2 migrants will be allowed to extend their temporary permission to stay in the UK up to maximum of 6 years, and introduce a 12-month ‘cooling off’ period
  • The UKBA will retain a route for overseas domestic workers in private households, but only when accompanying a visitor and limited to 6 months’ stay with no right to change employer
  • The UKBA will retain the current route of entry for private servants in diplomatic households under Tier 5 (Temporary worker - International agreement), with a maximum stay of 5 years and no ability to change employer or to settle

The change to the rules has been announced the day after it was revealed that the cap on the number of Tier 2 visas introduced last April has been undersubscribed with only 10,000 out of 21,700 places being taken. However, the reason that this cap is undersubscribed is because many migrants - nearly 8,000 more in the last 12 months - are now coming to the UK through intra-company transfer visas.

The announcement separating settlement from skilled migration has been hinted at over previous months, and was the subject of a report published by the Migration Advisory Committee (MAC) in November 2011.

The migration advisory committee has estimated that the current level of 60,000 skilled workers settling in Britain each year could be reduced to 20,000 by adopting a £35,000 earnings limit.

Is the threshold right?

In the report the MAC proposed a salary threshold of between £31,000 and £49,000 for skilled migrants hoping to apply for settlement. This means that the Home Secretary’s chosen barrier of £35,000 - whilst still considerably above the national average wage of around £26,000 - is at the lower end of this range.

However, it is also important to note that the MAC published their report in response to very specific questions from the government. The government did not ask what would be best for Tier 2 of the points based system, or the UK. Instead the government asked the following questions: ‘What would be the economic effects of restricting or removing settlement rights in Tiers 1 and 2’ and ‘which economic criteria could be used to identify the most economically important Tier 2 migrants for settlement?’

Matt Cavanagh of the think tank the Institute of Public Policy Research said to the Guardian, ‘Ministers accept that our economy needs skilled migrants to come and work at levels below £35,000 a year, but have decided that even if they work hard, pay their taxes, and play by the rules, they will be forced to go home after five years’.

‘This makes no sense in economic terms, will cause big problems for employers, and is unfair on individual migrants. It could also discourage the “brightest and best” from coming here in the first place. The majority of working migrants don’t stay permanently anyway, but they value the option, and if Britain no longer offers it, they may go elsewhere.’

‘“Guestworker” policies, such as those applied in Germany in the 1970s and 1980s, were notoriously unworkable,’ he said. ‘The pattern is always the same: the policy is quietly abandoned when it becomes clear that there is no way to enforce the new rules.’ He said instead of removing settlement rights it would make more sense to provide financial incentives for migrants to return home.

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