Graduate employers withdraw offers after visa rule change

As you may have seen in the news, a number of the UK’s biggest graduate employers have withdrawn job offers to some of their foreign graduates. They say the reason is down to the previous government’s decision to raise the minimum salary required to sponsor a skilled worker visa in the UK as part of their aim to reduce what they term 'over-reliance' on migration to the detriment of investment in the resident workforce. 

Under the new rules effective from last April, the general salary threshold for those arriving in the UK on a Skilled Worker visa has now increased by 48%, from £26,200 to £38,700. First year graduates are typically paid between £25,000 and £35,000 in the UK, meaning they are directly affected. Graduates who had their offers revoked were told they would not be able to defer their places to 2025. However, in most cases they have been told they can request to transfer to a different graduate programme this year, provided applications were still open on the firm’s website and if the role is eligible for sponsorship.

Two of the UK’s largest graduate employers are among those to comment on their decision. KPMG released a statement saying the changes to eligibility criteria had “unfortunately impacted some of our graduate programmes that were previously eligible for sponsorship under the skilled worker visa category.” An HSBC spokesperson said “due to changes in the rules covering those seeking sponsored visas to work in the UK we are unable to take forward a small number of offers to candidates as part of our graduate scheme this year. Whilst this is disappointing for both the candidates involved and for HSBC we are required to follow the regulations of every market we operate in.” 

A number of our clients are in a similar position do let’s hear more about this. Alex Wright is an immigration specialist advising on this and earlier he joined me by video-link to discuss it. I put it to Alex that the change to salary thresholds is a significant one: 

Alex Wright: “Yes, it's been a really significant change, probably the most significant change we've had in immigration law in a couple of years. So the way things operate is generally people who want to come to the UK as skilled workers have to meet minimum skill and salary levels. Those salary levels were significantly reduced following Brexit in order to help maintain workloads the UK and in light of net migration numbers they have been put to the highest level we've seen them in some time. So it's definitely impacting on employers’ ability to hire who they want because, well, they're going to have to pay international workers more than they were previously.”

Joe Glavina: “So which visas are affected by this?” 

Alex Wright: “So, the two main visas affected by this are the skilled worker visa, which people probably just know as the as the work visa, or what used to be known as the Tier 2 General Visa. So it used to be that minimum salary rates were £26,200 and that's gone up to a minimum of £38,700. Now, that’s just the base rate, that's the minimum you have to pay someone to sponsor anyone at all. There are some professions, very skilled roles, where the going rates for those roles are much, much higher. So in certain categories, for CEOs, for engineering roles, for some IT roles,  we have seen salaries go up even further. The other main route that we've looked at which are affected are the global business mobility routes. Now there are many, many different types of global business mobility routes. These are a number of specialist routes the Home Office use, but the most common one is what's known as senior or specialist worker, which back in the day was called intracompany transfer. So this is for organisations who have multiple branches and want to move their employees around. That used to be at a salary level of £45,800 and that's gone up to £48,500, So not as dramatic an increase but what we have also seen in the global business mobility routes is a reduction in the number of roles that are entitled to use it so it's not as broader category as it used to be in there are fewer categories of types of worker who can take advantage. So fewer job descriptions fall under that now.”

Joe Glavina: “Can I ask you about the effect on businesses, Alex? I’m guessing this is having an impact on many of our clients who have graduate recruitment schemes. Can you tell me about that?”

Alex Wright: “Yes, certainly. It’s definitely having an impact on some of our clients in terms of what salaries they're offering and also what their prospective employees are expecting from them. Many more people are expecting salaries in line with these new requirements and are requesting sponsorship. The thing for employers to be aware of is there are some circumstances where these rates do not apply. So if you've got people who were already sponsored before the regime in place that came in at the beginning of April, they do come in at a lower salary rate. So these new rates are solely for people who've come in new for the first time from 4 April 2024 onwards, and also for some categories of worker, for example, new entrants, graduates moving into the route, there are some discounts available. So it's always worth just checking before you move people in exactly what the correct salary level is for the role they're doing because there may be ways of reducing it slightly.”

Joe Glavina: “Finally, Alex, anything else to add?” 

Alex Wright: “I would encourage any employers to have a look at the standard occupation codes and see what's been changed since they last looked at them. There are plenty of really great resources out there explaining the changes to the immigration rules and we've got some really useful articles on our website that myself and the team have put together over the past couple months, explaining what those changes are and how best to navigate them.”

Those resources which Alex mentioned comprise an Out-Law article called: ‘UK employers face complexities due to immigration sponsorship changes’ plus an article they have posted on LinkedIn called: ‘How will new immigration rules impact the health and social care sector?.’ We’ve included links to both in the transcript of this programme.

LINKS
- Link to Out-Law article: ‘UK employers face complexities due to immigration sponsorship changes’
- Link to LinkedIn article: ‘How will new immigration rules impact the health and social care sector?’