It has not been the best of years so far for the Home Office. Immigration stories have dominated the front pages and claimed the career of at least one cabinet secretary. The department is under significant pressure to get ready for Brexit whilst still reeling from the fall out from the Windrush saga.

In the background there is another potential crisis brewing. The last few months has seen a number of developments which expose the failings of the Tier 2 system, the work permit category of the immigration rules. Brexit, the gender pay gap and the General Data Protection Regulations (GDPR) are all presenting significant challenges for Tier 2, highlighting how its rigid and inflexible rules are not fit for purpose in today’s modern world.

The Tier 2 Cap

The Tier 2 system is designed to enable employers to source labour from beyond the EU and to fill jobs where sufficiently skilled resident workers are not available. The government introduced a “cap” on Tier 2 General visas to limit the number of applicants who could come to the UK. This is currently set at 20,700 a year and split into 12 monthly allocations. Businesses who hold a sponsor licence can request what are known as restricted certificate of sponsorships on the Home Office’s online system each month. The requests are prioritised so that roles which are on the shortage occupation list, that pay large salaries or are at a higher skill level are allocated first from the monthly pot of certificates. This leaves jobs which pay lower salaries at risk of being refused.

Until the end of last year the cap was largely irrelevant as it had only been hit once in its history. However, in December 2017, there was a sudden increase in requests and the cap was hit, leading to large numbers of requests for certificates being refused. The problem is compounding, as unsuccessful applicants apply again each month preventing the backlog from clearing. The cap has now been hit every month since December.

Theories abound as to why this has happened. One culprit is certainly the effect of workers leaving the UK due to Brexit and employers having to look beyond the EU to source workers. Industries are now anxious about what the future will bring and whether they will be able to employ the staff they need. There are short term solutions which would ease the pressure, including taking NHS and shortage occupation jobs out of the group that must apply for restricted certificates. However, in the long term the Home Office needs to consider the justification for having a cap on Tier 2 and what purpose it serves.

The cap was brought in to limit the numbers of migrants who could enter the UK and with Brexit on the horizon, it could soon be redundant. At a time when many industries are experiencing skill shortages due to Brexit, any further restrictions on their ability to source labour is unhelpful to say the least.

Tier 2 and female workers

The Gender Pay Gap (GPG) reporting regime has also highlighted another problem with Tier 2. The visa route is restricted by a system of salary and skill thresholds which limits access to only the most highly paid and experienced applicants. The GPG shows that 78 percent of companies in the UK pay men more than women which makes Tier 2’s salary thresholds inherently discriminatory, as it will be easier for men to gain access to work under the Tier 2 system than for women.

The GPG also provides solid evidence that men occupy the majority of senior professional roles. Limiting Tier 2 to only highly skilled roles shuts out talented foreign female workers who are more likely to be in low skilled work, often despite being highly qualified, particularly after a career break to have children or for other caring duties.

Furthermore, the Tier 2 visa category is not reflective of modern working practices. It does not directly allow part time work as the salary thresholds are fixed and cannot be prorated according to the number of hours a migrant works. As women are more likely to want to work flexibly than men, this will adversely impact them more. The Tier 2 system is not catering to the needs of female workers and this urgently needs addressing.

General Data Protection Regulation

Finally, the GDPR presents significant issues for employers who have to negotiate the Tier 2 system. The GDPR regulates how data is processed and offers increased protection for data subjects who share information with employers. The GDPR will necessitate employers weighing up competing demands, as they have an obligation to correctly handle data whilst at the same time meeting strict sponsorship duties under Tier 2.

For instance, Tier 2 requires an employer to complete ‘the resident labour market test’ to demonstrate that there are no other settled workers suitable for a role by advertising it for 28 days. To ensure this test is completed correctly, the Home Office requires the employer to keep extensive records of the recruitment campaign, including the applications from everyone who was interviewed. The employer has to keep this information for up to seven years.

It is likely that unsuccessful job applicants will have concerns that their data is being kept and shared with the Home Office for this purpose. Employers will then be faced with a difficult choice between breaching their duties under the GDPR or their sponsorship duties under Tier 2. As data privacy is now a major issue for businesses, the Home Office will have to come to terms with the fact their sponsorship duties cannot always take precedence.

The complex Tier 2 system was designed to exclude as many potential candidates as possible in order to protect the UK jobs market from the supposed negative effects of migrant labour. With Brexit on the horizon, businesses need a work permit system which allows them to easily attract and employ the workers they need. This requires the Home Office to listen to industries and to create a system which is open and responsive to the modern working world.