Brexit Update

by Ivon Sampson, Partner - Head of Immigration at Healys

The UK and the EU have finally come to some sort of draft agreement

The Draft Withdrawal Agreement (In Principle)

We’ve heard it said from both sides that nothing is agreed until everything is agreed, therefore unless the two sides resolve the major issues then the Draft Withdrawal Agreement is not worth the paper it is printed on.

That having been said, both the EU and the UK need a framework document with timelines in order to reach a final settlement.

The draft withdrawal agreement does however, for the first time provide us with a comprehensive plan of what you nationals can expect post Brexit. The key features are as follows;

Transition Period – This has been agreed as between  30 March 2019 and 31 December 2020

Cut off Period For Free Movement- This has moved to 31 December 2020. (EU nationals may still remain after that date depending on the terns of the final withdrawal agreement.

New Status Document – All EU citizens who wish to remain in the UK post 31 December 2020 MUST apply for a new status document. The deadline for doing this is 30 June 2021.

Family Members of EU Nationals – If the relationship has existed before the end of the transition period then they can join their EU family member in the UK. Family members defined as, Spouse/civil partner, durable partner, children under 21 and dependant direct relatives in the ascending line.

EU Nationals Coming To The UK After Transition Period – These individuals will have to apply under the new regime which has not been decided by the Home Office.

Refusal/resubmission of applications- prior to 31 December 2020 EU nationals  can resubmit applications for settled/temporary status if their application is refused. However, applications refused post 01 January 2021 can only be appealed

The interesting thing to note is that the new “settled status” is different from the automatic right to permanent resident which presently exists under Rule 15 of the EEA Regulations. The criteria for such settled status may also change. I would assume that all EU nationals would have to apply for this status document even if they already hold a permanent residence document.

Also, an additional six month period after the end of the transition period has been allowed for those who wish to apply for a settled status document.  

What are the likely risk scenarios for businesses to a hard or soft Brexit? 

There has been a great deal of uncertainty and animosity between the UK and the EU, since the UK declared its intention to leave the EU following the referendum in March 2017. Because of this, neither side is willing to commit to firm promises of what the new relationship between the UK and EU will look like post Brexit. What I can describe (in my view)  is the likely regimes of either a withdrawal  agreement reached or one where there is no agreement

Soft Brexit

  1. A transitional period of 2 years permitted from March 2019 to allow EU nationals already in the UK to apply for permanent settlement
  2. Freedom of movement to continue for those that wish to work in the UK but job offer required before an EU national allowed to come to the UK
  3. No minimum skills threshold
  4. No minimum pay requirement
  5. No residence labour market test required
  6. Right to permanently settle to continue after 5 years residence in a qualifying category
  7. Application fee to settle or reside to remain at £65 per applicant

Hard Brexit

  1. No transitional period. EU workers who do not have permanent settlement must make an application to remain in the UK prior to March 2019
  2. Freedom of movement to cease from March 2019. A new immigration category introduced for EU migrants similar to the present Points Based System (PBS)  for non EU workers
  3. Minimum skills threshold similar to the PBS
  4. Minimum pay requirement
  5. Residence labour market test required
  6. Right to permanently settle to continue
  7. Application fee (permanent settlement) to be raised to circa £1000.

How can businesses limit the risks? 

EEA Permanent Residence

Under the current EEA Regulations (Reg 15) EEA nationals are entitled to permanent residence if they have been resident in the UK as a qualifying worker for a period of 5 years and have not spent more than 6 months out of the UK in any calendar year. This will provide these individuals with settled status. Also, irrespective of what the outcome of the Brexit negotiations are, these individuals will be allowed to remain in the UK post Brexit. In addition, after 1 year of holding EEA PR, these individuals will be eligible to apply to be naturalised as a British citizens.

Residence Permit (those EU employees that haven’t been residing in the UK as qualified workers for 5 years)

Under the provisions of the EEA Regulations, an EEA national exercising Treaty rights as a worker is entitled to apply for a 5 year Residence Permit. EEA nationals do not need to apply for such permits in order to work here as their passport or national identity card is sufficient to allow them to do so. The EEA Residence Card is simply a documentary proof of an automatic entitlement.  The reason we are advising clients to make such applications is because post Brexit EEA nationals may not have automatic rights to live and work in the UK.  They will however be able to argue that they have a 5 year grant of leave, which still stands, as they have a legitimate expectation of that right as the law stood at that time of the grant of leave.

What are the pros and cons of regularising the immigration status of EEA employees now or waiting till after the Withdrawal Agreement is finalised? 

Pros

Certainty in regularising the immigration status of your EU workers

Goodwill established with EU workers

Significant reduction in application costs and legal fees as many EU nationals will have the right to challenge a Hard Brexit in court

Cons

Legal costs incurred now as opposed to waiting and applying post Brexit

  • After incurring legal costs for each employee, they may leave their employment

What are the cost implications for Mobvista to regularise the status of their EU employees now or waiting post Brexit? 

Applying now

  • £65 application fee plus legal costs (fixed)
  • Decision within 2-4 months

 

Applying Post Brexit

  • £1000 per application (estimate) plus legal costs (fixed)
  • Decision,  unknown as hundreds of thousands of EU nationals will be applying simultaneously.

     My advice to clients has remained constant throughout Brexit. If you can either apply for permanent residence for a residence permit this side of Brexit then do so immediately.

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