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Government to Freeze Tier 2 ILR Salary Threshold

Mar 13, 2020

After this week’s unpleasant news of a steep increase in the Immigration Health Surcharge, the government’s announcement that the salary requirements for Tier 2 ILR will not be rising to the planned £36,200 in April comes as a welcome relief. This is in line with the MAC recommendations discussed here, which indicated the planned raise would be unsustainable across many sectors and represented an unrealistic level of pay increase. This risks resulting in preferential treatment of foreign nationals over their UK-born counterparts. The threshold will therefore be remaining at £35,800 until further notice.

The question is whether this will be enough. With the government planning to lower their salary threshold for Tier 2 (General) to as low as £20,480 in some cases from January 2021, this would require migrant workers to secure a pay rise of at least £15,320 within 6 years of starting the role in order to be eligible for ILR. It is not possible to extend Tier 2 beyond 6 years in order to allow migrants more time to reach the required threshold. There is therefore a risk of employers taking a ‘revolving door’ approach to foreign labour, sending their employees home at the end of their 6 year period and bringing in new, cheaper labour to avoid having to pay salaries way above the average ‘going rate’ for the sector.

If you have any questions about ILR for yourself or for your employees please don’t hesitate to get in touch at [email protected] or on 01403 801 801

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