On 20 March 2020 the Government announced unprecedented measures to ensure the financial stability of the Country, supporting employees who would otherwise have been laid off or made redundant (furloughed) as a result of COVID-19 outbreak.
Based on the new Scheme, the Government will reimburse up to 80% of the wage costs of employees who would have been laid off (up to £2,500 per month).
If your business is considering accessing the Government Scheme and cutting salaries, this may affect your Tier 2 employees.
As an employer there will be extra considerations for those employees who you intend to furlough who are working for you on a Tier 2 sponsored work visa.
You will need to remain compliant with your sponsor duties during the “job retention scheme” period, keeping in mind that the usual salary requirements for sponsorship have to be met.
For example, for Tier 2 visa holders, a drop in salary has to be reported on the sponsor management system (SMS) within 10 working days. If a drop in salary takes a Tier 2 employee below one of the salary thresholds for Tier 2 visa, then the usual consequence is that they might not continue to be sponsored.
In addition, if a Resident labour market test was not carried out for your high-earner Tier 2 employee and you are now considering a cutting of salary below the required salary level, the rules require the migrant to submit a new application.
This means that you should seek legal advice about your Tier 2 visa employees before making a choice.
In fact, many side-effects can be around the corner.
It is also very important to remember that Tier 2 migrants are not allowed to access public funds.
Even if, under the new scheme, they will eventually be paid through public funds, their reduction in salary will not entitle Tier 2 migrants to access any other measures of the UK welfare system (universal credit, etc). Claim benefits could result in a breach of the immigration rules (curtailment) and migrants could jeopardize their immigration status in the UK.
As a Sponsor, any change must be reported through the Sponsorship Management System and specific records must be kept in case of future audit carried out by the Home Office.
In order for your business to comply with your sponsor duties and avoid compliance actions against you during this difficult time, please contact us for further advice.