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Immigration price hike hits employers

The price hike could see employers paying £11,834 per employee -

The UK government’s visa price hike has come into force today (4 October) leaving workers and employers with a much larger bill.

The rise in price for immigration processes has largely been targeted at immigrants themselves, with a 15% minimum jump in the price of visa applications. 

A skilled worker visa for three years or less will now set applicants back £719, up from £625. The cost rises to £1,420, up from £1,235, for applications for over three years' right to remain.

Read more: Government’s reactive approach to immigration is stymying growth

Given that many businesses opt to help immigrant employees with the cost of their move, however, the new price hikes are likely to affect a wide variety of businesses that hire from abroad.

Tsige Berhanu, immigration partner at employment law firm Keystone Law, told HR magazine: “Although the skilled worker visa provided some relief to the acute shortage of skilled workers in the aftermath of the pandemic and Brexit, the significant costs associated with these applications has had substantial financial impact on businesses [hiring from abroad].”

The direct cost of employing immigrant workers has largely stayed the same for businesses, though employers have seen a 20% uplift on the cost of a Certificate of Sponsorship.

The certificate, required for any skilled worker visa, will now cost £239, rather than £199. It must be paid before the potential employee has begun their application for a visa.

The hospitality sector, Berhanu added, has been particularly badly affected since Brexit, and has had to adapt to using the skilled worker route to immigration. 

Should an organisation choose to sponsor its employees through the immigration process, it could now face bills of up to £6,600 for a small organisation, or £9,800 for medium-sized or large organisations.

Berhanu added that the government’s plans to increase the immigration health surcharge (IHS) – an annual charge originating in then home secretary Theresa May’s 2014 anti-migration ‘Hostile Environment’ policy – would have an even bigger impact.

She said: “The government’s intention to increase the IHS by a whopping 66%, at a date to be confirmed, will hike up the above-mentioned fees significantly to £8,654 and £11,834 respectively. 

“This will most likely have a significant impact on most businesses’ recruitment strategies and their ability to rely on this route to fill vacancies.”

“Employees with dependent families will also be impacted, as the IHS is payable for each family member.”

Read more: Key HR strategies for managing immigration

As well as deterring talent coming to the UK Josephine Whitaker-Yilmaz, policy and public affairs manager at migrant and refugee support charity Praxis, told HR magazine that existing workers in the UK also face being pushed into poverty and destitution.

She said: “Instead of being able to focus on what matters to them – including caring for their families and advancing their careers – the people we work with are constantly worrying about making regular applications to renew their visas, and how they’re going to save the thousands needed to renew their leave to remain.

“When the full set of visa fee hikes kicks in, a family of four could be facing a bill of more than £14,000 every 30 months, an increase of almost 50% on the current cost.”

Unison, the union representing nearly 500,000 workers across the NHS, condemned the price hike in July.

Whitaker-Yilmaz continued: “We know NHS nurses, accountants and software developers, among others, who are barred from accessing further training, better qualifications or permanent contracts because of the time limit imposed on their leave to remain, despite the fact that they have already lived in the UK for years, if not decades, and they’ve established their families and careers here.”

The full list of changes is available online here