“Immigration is “particularly important” to the wholesale and retail, hospitality and health sectors, which employ around 1.5 million non-UK nationals, according to an official analysis.” The Independent

There are an estimated 3.2 million EEA nationals in the UK and according to the Office for National Statistics, one in ten employees in some sectors in the UK could be affected by Brexit. For many European nationals, the Government’s reluctance to provide an assurance as to their status has led them to seek this certainty by applying for residence documentation or British citizenship. Indeed, the Home Office has had to double the size of its European caseworking team to cope with the number of applications received, which in one week surpassed 10,000.

The Prime Minister, Theresa May, made a clear commitment that “no EU citizen currently in the UK lawfully will be asked to leave the country at the point that the UK leaves the EU, and that all EU citizens lawfully here at the point the UK leaves will have the opportunity to regularise their status to remain in the country.”

However, the Government’s recent proposal to the European Council, entitled Safeguarding the Position of EU Citizens Living in the UK and UK Nationals Living in the EU, has come under criticism for adding to the confusion. The proposal sets out the Government's plans for EU nationals living in the UK and how they would like British nationals in the EU to be treated, post Brexit.

In summary, it splits EU nationals into three different categories depending on whether they entered the UK before or after the “specified date” (which is yet to be agreed but will be between 29 March 2017 and the exit date in 2019) and residence duration:

  • those who have already completed five years in the UK prior to the “specified date”. These individuals will need to apply for “settled status” whether or not they have already applied for and obtained permanent residency in the UK;
  • those who arrived in the UK prior to the “specified date” but are yet to complete five years here – they will be allowed to remain resident in the UK until they complete five years and can then apply for the new “settled status”;
  • those who arrived in the UK after the “specified date” but before the exit date in 2019 – they will have a two year transition period from the "specified date" to apply for some status under the immigration rules in order to remain.

It is the uncertainty provided to those EEA nationals who fall into this third category that is impacting recruitment and businesses reliant on EEA nationals, with the health sector, for example, reporting a drop of 96% in EU nurses registering to work in the UK.

EU nationals make up 6% of all retail employees; it is not clear what immigration system would be in place post Brexit and if this would address the needs of the sector. The current Tier 2 sponsorship system requires employers to obtain a sponsor licence to enable them to sponsor migrant workers to work in the UK and is only available for certain roles that meet the Home Office skill and salary thresholds. Retail roles such as store managers, merchandisers, and buyers are not deemed to be at the required skill level for Tier 2 sponsorship and so the current system is unworkable.

Last week, the Government commissioned the Migration Advisory Committee (MAC) to report on the impact on the UK labour market of the UK’s exit from the EU and how the UK’s immigration system should be aligned with a modern industrial strategy. The MAC will be producing a call for evidence in the coming weeks setting out how stakeholders can get involved. It is expected that the MAC’s report will help shape a future immigration system and so the retail sector is encouraged to take this opportunity to have its say and submit a response. For the commission for advice letter, please click here.

In the meantime, retailers relying heavily on EU nationals should ensure sufficient support and information are cascaded to their staff.