Talent shortages could worsen as only 3.5 per cent of UK employers have sponsor licence, data shows

Employment lawyers suggest remote working ‘workaround’ to remove bureaucratic red tape on employing overseas workers

Credit: Nicolas Economou/NurPhoto/Getty Images

Only a small minority of UK employers currently hold a licence to sponsor EU or non-EU workers, despite skills shortages, data shows. 

Analysis of Office for National Statistics data by Migrate UK found that while unemployment had dropped to its lowest level since 1974, many organisations are still failing to use sponsor licences to aid recruitment. 

This is despite the fact that employers need to hold a sponsor licence from the Home Office to employ the vast majority of EU workers following Brexit.

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Helen Astill, founder and director of Cherington HR, said the lack of such licence could considerably disadvantage organisations and the economy's ability to source talent as “it severely restricts the available talent pool while businesses are currently finding it really difficult to fill some of their posts with those who have the right to work in the UK”.

As sponsor licence applications currently take an average of two to three months to process, Migrate UK has advised businesses suffering from persistent skills shortages to apply for a sponsor licence to aid their recruitment.

Migrate UK also highlighted that the type of skills a firm required and its previous recruiting experience will determine the cost of the potential sponsorship.

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It said that once a company has obtained the licence it can use it as needed, and this could improve the talent pipeline as it would make businesses more attractive to overseas employees.

Kate Palmer, director of HR advice and consultancy at Peninsula, said while there are no ways around the regulations without businesses risking a hefty fine, remote working could be the answer.

“Many employers are able to work around immigration rules by employing foreign workers entirely remotely,” said Palmer, adding that this is not an “easy solution, especially when factoring in the need to become familiar with the laws of the country within which the employee resides, and the practical complications such employment can bring, like managing them remotely,” Palmer added.

Shazia Ejaz, director of campaigns at the Recruitment and Employment Confederation (REC), said that not enabling a cheaper, more efficient system limits the UK’s ability to compete for skills globally. “Opening up the ability to fill vacancies with people from other countries should be a priority consideration for the government as it plans its growth agenda,” he added.

Chetal Patel, partner at Bates Wells, highlighted that sponsorship costs, visa fees, and bureaucratic red tape continue to be the biggest barriers for many organisations.

“As part of the sponsorship reforms, the removal of the resident labour market test was meant to speed up the recruitment process by four weeks, however, that’s not the reality for many organisations,” she said.