Tuesday 20 May 2025

On Monday 12 May 2025, the UK government published a white paper announcing a series of proposed changes to the Skilled Worker route with the aim of tightening restrictions for both foreign nationals and sponsors. These changes are expected to roll out in stages, with some likely taking effect within weeks, and others subject to public consultation and therefore likely to take several months. We set out below what sponsors should be doing to ensure compliance and mitigate cost and other negative impacts.

What are the key changes?

Skill and salary thresholds
The minimum skill requirement for the Skilled Worker route is set to rise to degree level (RQF Level 6), rising from the current threshold of RQF Level 3 (A-Level equivalent).  Transitional provisions will allow sponsored workers who are already in the UK in RQF Level 3-5 occupations to continue to extend their permission in the route. Roles that do not meet this threshold may still be eligible under a new ‘Temporary Shortage List’ which is set to be introduced. This will be time-limited and reserved for roles considered critical to national priorities, sectors, and infrastructure. Final decisions will be made by appointed advisory bodies therefore the implementation of this List may take longer than other suggested policies listed below.

The Immigration Salary List is likely to be removed, meaning affected roles must meet higher salary thresholds.

English language requirements
The English language requirement for Skilled Workers is expected to increase from B1 (Intermediate) to B2 (Upper intermediate). Additionally, dependants of Skilled Workers (who were previously exempt from meeting this requirement) will need to meet A1 (Beginner) level on initial application and progress to A2 (Elementary level) on extension.

Revival of domestic focus on recruitment
The government is urging employers to focus more heavily on recruiting and training the domestic workforce. This may include:

• incentives for investment in UK-based training; and
• a requirement for employers to produce a “workplace strategy” outlining domestic recruitment efforts.

More specific guidance is expected to follow in the coming months.

Increased Immigration Skills Charge (ISC)
The ISC is set to rise by 32%, significantly increasing the cost of sponsorship. By way of example, for a medium/large sponsor the ISC to sponsor a worker for a period of five years will rise to £6,600.

Importantly, employers are not permitted to recoup this charge from the sponsored worker. Given the government’s intention to increase the period to settlement form 5 to 10 years, the cumulative ISC cost could potentially more than double over the life of a worker’s sponsorship. This change is anticipated to be among the first changes, owing to its straightforward implementation.

Graduate route shortened
The Graduate route, which allows international graduates to work in the UK without sponsorship, will be reduced from 24 to 18 months. Employers may wish to review their approach to utilising this route, for example by switching current Graduates onto the Skilled Worker route before the ISC hikes take effect, or sponsoring upcoming hires who currently hold immigration permission as Students directly as Skilled Workers (rather such individuals first applying for Graduate permission) to take advantage of the exemption to paying the ISC applicable in such applications.

Doubling the residence period for settlement to 10 years
A Skilled Worker can currently apply for settlement (indefinite leave to remain (ILR)) once they have resided in the UK for a continuous period of 5 years. The white paper proposes extending the standard residence period (in various routes including Skilled Worker) to 10 years. While initial indications suggested the proposed increase to a 10-year settlement route would apply only to new Skilled Worker applicants, recent reports indicate that the government may seek to apply this change retrospectively to current Skilled Workers who have not yet obtained settlement. This suggestion has already drawn significant criticism and would require a formal consultation process before any implementation. As such, it is unlikely that this change will take effect in the immediate future.

Employees with permission as the partner or spouse with a British citizen or settled person are expected to remain eligible for settlement after five years.

The government’s recent white paper also mentions the potential for reducing the settlement period based on an individual’s contribution to the UK economy and society, although further details on how this will be assessed are still to come.

What can employers do to mitigate impact?

1. Conduct an internal audit: The first step for sponsors should be to review its sponsored workforce and assess any roles or workers most likely to be impacted.

• Review the occupation code classifications that have been assigned to sponsored workers, to determine if any roles fall below RQF Level 6 and therefore at risk of not being eligible for sponsorship in an extension application.
• Assess whether any sponsored workers are close to their permission expiry and consider bringing their extension applications forward before the new rules and increased fees take effect.
• Identify workers eligible for settlement within the next few months and consider advising them to apply for settlement as soon as possible to avoid the risk of being affected by the 10-year rule implementation.
• Assess your current CoS allocation to ensure you have sufficient CoS if you wish to bring forward application submission dates. The Home Office is likely to anticipate increased requests for additional CoS in response to upcoming changes. Therefore, it is advisable to request any necessary in-year CoS allocation increases proactively, in case the Home Office imposes tighter restrictions.
• Assess your recruitment needs – For any Skilled Worker extension applications on the horizon or planned new hires requiring sponsorship, consider whether any applications can be brought forward to assign Certificates of Sponsorship before the ISC and skill level increase or Immigration Salary List removal (CoS can be assigned up to 6 months prior to the start date).
• Review use of the Graduate Route, consider early sponsorship for individuals currently on the Graduate route to avoid the ISC increase.
• For those currently on the Student route, consider direct switching to the Skilled Worker route as Student-Skilled Worker switches are exempt from ISC. For these individuals who remain in the same role, any future Skilled Worker applications are also exempt from ISC. In light of the forthcoming settlement changes, this strategy could potentially save sponsors from incurring up to ten years’ worth of ISC payments

2. Reassure current sponsored workers: Since Monday, many sponsors have been facing questions from their sponsored workers regarding how this will affect their circumstances. Once sponsors have reviewed the impact of these changes on the organisation, it may be beneficial for employers to reassure workers that they are aware of and keeping up to date with any upcoming changes, and address queries directly about how this could affect them. Importantly, sponsors should highlight that these policy announcements are still broad in detail and that further information is to come.

3. Consider alternative immigration routes for current and prospective employees: Given the tightening of the Skilled Worker route, sponsors may wish to consider alternative UK immigration routes:

• High Potential Individual (HPI) route expansion: This category is for graduates of top-ranked global universities (currently dominated by US and Canadian institutions). Eligible individuals are permitted to work in the UK without restrictions for two years (although note this route does not lead to settlement). The government has signalled plans to expand the list. Employers should check whether candidates:
  • hold an eligible overseas degree;
  • graduated within the past five years; and
  • attended a listed HPI institution.
• UK Ancestry Visa: Available to Commonwealth citizens with a UK-born grandparent. This route allows individuals to work in the UK with no work restrictions and sponsorship and leads to settlement.
• Global Talent route: Although this route is known for its high eligibility threshold, the government has confirmed plans to further expand it in order to attract highly skilled individuals in the digital technology, arts, and academic sectors. It may be a viable option for individuals with well-established careers in these fields.

Get in touch
Please contact enquiries@lauradevine.com or your assigned LDI lawyer if you would like further assistance to prepare for these upcoming changes and subscribe to our mailing list to receive the latest updates and implementation timelines as they become available.