All You Need To Know About The EU Settlement Scheme

January 4, 2022


5 min

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What does Brexit really mean for UK employers and what they should look out for before the 30th of June

Maybe due to the fact that COVID has taken over all the news headlines as well as our ability to travel, Brexit has received less attention as expected and suddenly, just like that, it has happened. The UK has left the chat.

And not only that, but soon enough the EU settlement scheme will come to an end on the 30th of June. But what does this mean for global employers and what should they look out for?

UK Nationals working in the EU

The end of the eligibility period for the Withdrawal Agreement on the 31st of December 2020 marked the date from which on, UK citizens living and working in the EU are required to comply with each country’s working and living regulations, which strongly differ from one another. The holding of a EU Blue Card is the exception to the rule since.

However this document will only be provided to highly qualified workers, granting them the freedom to work in any EU country they wish. Also one should bear in mind that the card is not valid in Denmark.

All together, employees will need an employment contract, a higher education degree as well as a competitive salary in comparison to the average for the position in the host country.

EU nationals already working in the UK

But what about the EU employers with employees in the UK? If they have been working in the UK since before the 31st of December 2020, they will most likely remain under the EU Settlement Scheme. They will not need to make any changes if they already have an Indefinite Leave to Remain.

If they don’t, they are able to apply here for settled or pre-settled status. This free scheme will grant the right to live and work in the UK, as well as to use the National Health Service, and to access public funds as would pensions and benefits be.

EU nationals that may need to work in the UK in the future

However, things will change at the end of June 2021 when the EU settlement scheme is concluded. Even though traveling to the UK for a stay no longer than 6 month without a visa, if an EU citizen wishes to work in the UK, he/she will need to apply for a Skilled Worker Visa.

This Visa will allow the holder to not only work as well as to apply for additional work in the UK, but also to study for a period of 5 years. It can be renewed or the employee will even be able to apply for Indefinite Leave to Remain. The Skilled Worker Visa will not provide the holder with social benefits.

As an employer, you will have to take the following aspects into consideration:

  • Hire the employee as a UK employer
  • The employer will need to provide a Certificate of Sponsorship to the employee
  • Make sure their role is eligible using its four digit code
  • Verify that the employee to be hired speaks, reads and writes English
  • The employer will have to pay the employee a salary of at least £25,600 per year and more than the going rate for that specific position.

In order to be able to provide a Certificate of Sponsorship, employers will need to hold a sponsor license. If you match the criteria, your application will take up to 8 weeks to process. Small businesses as well as charities will have to pay £536 and larger companies and enterprises will have to pay £1,476.

The exception: The Global Talent Scheme

As always, there is an exception to the rule. If potential employees comply with the criteria of the Global Talent Scheme, they will not need a visa to work in the UK.

This would allow leaders as well as future leaders in different fields and industries to work in the UK with their family for up to 5 years, with the possibility to extend. You can find out about related fees and more here.

Ensuring compliance and alignment with the new post-Brexit employment with WorkMotion

Even before Brexit became a thing, local laws and compliance had always to be considered by employers in the UK and the EU, since there was no single market between them.

Now, this situation has become increasingly complicated, and EU workers as well as employers will be facing some difficulties if they haven’t secured the Settled Status.

An important issue for employers might result in a loss of EU workforce and therefore face talent shortages. Employing people illegally will be a dangerous game since it comes with a £20,000 fine per employee.

Therefore, employers in the UK should look into setting up all the relevant and needed organisational policies as well as recruitment and on-boarding processes, so that they are compliant with right to work duties.

But ensuring compliance requires expertise, resources, and plenty of time. As a global employer, it is important to make sure everything is in place while not missing out on important opportunities and neglect your company’s growth.

A global EOR (Employer of Record) service such as WorkMotion will save you time and money and will take care of those challenges on your behalf.

This will help you minimise risk and avoid fines that can have a large impact on the bottom line. Not only will WorkMotion take care of the full compliance with local legislation but also help you hire, pay and manage remote employees from all over the world with just a push of a button.

We will take care of the onboarding process, the payroll and benefits packages so that you will have everything in place before the 30th of June enabling you to focus on your goals and the future of your company.

Curious to know more?

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