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UK immigration cap: where business stands after High Court finds temporary limits unlawful

In a ruling by the High Court on 17 December, the temporary cap on the number of skilled non-EEA workers allowed entry to the UK was held to have been introduced unlawfully. While the practical reality for businesses has not necessarily changed, given revised immigration rules laid before Parliament on 21 December, the ruling was cause for some government discomfort.


The judicial review challenge against the interim caps placed on Tier 1 (General) and Tier 2 (General) migration was brought by the Joint Council for the Welfare of Immigrants (JCWI) and the English Community Care Association (ECCA). The judgement held the caps to be unlawful, on the basis that ministers failed to obtain proper parliamentary approval before implementing and imposing them on migrants and employers.

Government reaction

Damian Green MP, immigration minister, said he was disappointed with the court decision, but emphasised that the judgement would have no impact on permanent limits on non-EEA workers, which are to be introduced in April 2011. He said the Government would do all in its powers to stop a rush of applications in advance of the permanent cap coming into force.

It is fair to say that the High Court decision rests on technical process, in that the Government failed to lay proposed rule changes before Parliament for approval. Instead, it announced its intention to introduce the temporary cap, but failed to detail how the cap would operate or the actual limits on skilled and highly skilled migrants. Details were then posted on the UK Border Agency website.

While the full judgement is thought unlikely to be critical of the proposed permanent limits on non-EEA migrants, it does cause the Government embarrassment at a time when it wishes to ensure a clear message is given to the electorate regarding commitment to reduce net migration into the UK to "the tens of thousands". Ultimately, this judgement is about government adhering to a key constitutional principle.

Revised immigration rules

Following the ruling, the Government swiftly made a statement that it would lay revised rules before Parliament "re-introducing" the interim caps and also closing Tier 1 (General) for out-of-country applicants, given that total cap levels would be met by applications already filed and pending consideration. Tier 2 interim cap provisions came into force on 21 December and Tier 1 (General) closed for out-of-country applicants on 23 December.

Where does this leave business from now until April 2011?

In reality, businesses will continue to be subject to the Tier 2 (General) interim cap provisions imposed in December and which are in line with the original levels imposed on 19 July. If companies are lucky enough to have an allocation left, enabling them to support applications/extensions for skilled new hires from outside the EEA, they can proceed as usual under Tier 2 (General) of the PBS.

If a business has either used up its allocation under the interim cap or was one of the many companies receiving a ‘zero allocation’ from July 2010 until April 2011, the only option is to file an application via the ‘exceptional cases’ process. Under this route, cases are assessed by a panel and ranked by merit, dependent on three factors: whether the request relates to an extension of an existing permission; whether the occupation is on the Shortage Occupation List; and the salary package for the role.

Alex Paterson (pictured) is managing partner at Fragomen