Many employers and employees were left in the dark over the impact of furlough and Employer Retention Scheme and how it applies to Tier 2 works as the immigration status of Tier 2 workers is tied to employment at a minimum salary.
On Friday, the UKVI finally confirmed the below:
- As a business, if you are unable to pay the salaries of your sponsored employees because as a company you have temporarily reduced or ceased trading, then you can temporarily reduce the pay of your sponsored employees to 80% of their salary or £2,500 per month, whichever is lower.
- The reduction in salary will only be justified if it is a part of a company-wide policy to avoid redundancies and to enable the equal treatment of all workers.
- The reductions must be temporary and therefore the salary level must return to at least previous levels once these arrangements come to an end.
It seems that the UKVI are indicating that the salary can fall below the relevant SOC code salary threshold minimum while the Tier 2 worker is furloughed, without this negatively impacting the sponsorship as long as the salary level returns to at least the previous level once the arrangement comes to an end. This will be comforting news for many employers and employees in this uncertain time.
The UKVI guidance is mute on the point of whether the salary changes need to be reported. Our expert advice is that all sponsors continue to report this via the SMS and provide an explanation for the change in salary and also report once the salary returns to its normal level. All changes are to reported within 10 working days. Further to this, they should retain evidence of their firm-wide policy on the same as justification. This will also safeguard the sponsor’s position in the event of a UKVI audit in the future.
If you have any coronavirus related visa concerns please do get in touch at [email protected] or on 01403 801 801 for consultation.