On 12 May 2025 the Government published a White Paper setting out its plans to reform the UK immigration system. Headlines include returning eligibility for Skilled Worker sponsorship to graduate level roles and above, doubling the qualifying period for settlement to ten years, raising the Immigration Skills Charge by 32% and restricting Graduate route permission to 18 months. Sponsors should review their recruitment pipelines and make applications where possible ahead of the changes.
In this article we analyse the key policies set out in the White Paper that are most likely to impact businesses.
Introduction
The overall objective of the policies outlined in the paper is to reduce net migration further and faster to sustainable levels during the term of the current Parliament. Other priorities relevant to businesses are to:
- Encourage businesses to further contribute to training and recruiting workers from the domestic labour market;
- Reduce the scope for worker exploitation in work routes;
- Ensure migrants have a higher level of English language proficiency; and
- Lengthen the qualifying periods for settlement and citizenship for those in most routes leading to settlement unless contribution-based factors apply.
Many of the reforms do not have a fixed date for implementation, and some of them will also require consultation and/or evidence-based input from the planned Labour Market Evidence Group (LMEG). The first changes are due to be introduced 'in the coming weeks'. Where timelines or other details are known, these are indicated below.
The immediate effect we expect to see is a rush on settlement and citizenship applications. A rise in Skilled Worker and Senior or Specialist Worker applications is also anticipated ahead of the skill and salary threshold changes and the Immigration Skills Charge increase. There is also likely to be a drop in student route numbers due to the lower Graduate route permission length and higher salary thresholds to move onto the Skilled Worker route.
Further details of the Government's plans are set out below.
Skilled Worker route restrictions
The Skilled Worker route is the UK's main work route leading to settlement. This route will be subject to substantial restrictions in comparison with the current position. The White Paper refers to 'immediate changes' to the Immigration Rules and mentions that the Skilled Worker route changes will be part of the 'first stage' of the package of measures being brought forward.
Planned reforms include:
- Restricting eligibility to roles at RQF Level 6 or above (graduate level), reversing the liberalisation of the route that happened post-Brexit;
- Considering whether RQF Level 6+ roles should be subject to a workforce plan where there is evidence of over-reliance on migration;
- Abolishing the Immigration Salary List, which currently allows listed occupations to benefit from discounts to salary threshold requirements;
- Introducing a Temporary Shortage List, under which roles in
long-term shortage at RQF Levels 3 to 5 (below graduate level) may
be sponsored for a time-limited basis, and where:
- The Migration Advisory Committee (MAC) has confirmed this is justified and there is a workforce strategy in place (in the interim this will be where the MAC has recently considered the occupation to be in shortage or it is considered crucial to delivering the Government's Industrial Strategy); and
- Sponsors of these roles have committed to 'play their part in increasing recruitment from the domestic workforce';
- Introducing restrictions on bringing dependants where the worker is occupying a role on the Temporary Shortage List;
- Removing carers and senior carers from Skilled Worker route entry clearance, but allowing in-country switches and extensions during a transition period up to 2028, and subject to further review;
- Increasing the salary thresholds for Skilled Worker route sponsorship – this will be a logical consequence of removing medium-skilled roles from eligibility, however it is not clear whether the general salary threshold, occupation-based going rates or both will be affected;
- For key sectors where there are historically high levels of sponsorship – only allowing further use of the immigration system where a workforce strategy is in place under which sponsors have agreed to take certain steps on skills, training and working conditions, as well as engaging economically inactive individuals in the UK economy;
- Following the closure of the Displaced Talent Mobility Pilot, considering allowing a limited number of UNHCR recognised refugees and displaced people abroad to apply under the Skilled Worker route and other sponsored work routes; and
- Increasing English language requirements and introducing English language requirements for adult dependants – see separate section below for more details.
Immigration Skills Charge increase
The Immigration Skills Charge (ISC) applies to the Skilled Worker and Senior and Specialist Worker routes, subject to limited exceptions.
The ISC will be increased by 32%, raising it from £1,000 to £1,320 per year for medium or large sponsors, or from £364 to £480 per year for small or charitable sponsors.
The Government proposes to ring-fence this fee to 'support skills funding for priority sectors to upskill the domestic workforce and reduce reliance on migration over the medium term'.
Reducing permission on the Graduate route to 18 months
The length of permission granted under the Graduate route will be reduced to 18 months. It would appear from the wording in the White Paper that this will apply to all graduates. If so, this would remove the differentiation for PhD or other doctoral graduates, who are currently allowed permission for three years under the route rather than the two years applicable for all other qualifying graduates.
The Government will also consider a levy on the income higher education institutions receive from international students and further details about this will be announced in the Autumn budget.
Establishing a Labour Market Evidence Group (LMEG)
The new LMEG advisory group will be made up of the Industrial Strategy Council, skills bodies across the UK, the Department for Work and Pensions and the Migration Advisory Committee. This group will be responsible for recommending where workforce strategies should be implemented.
Sponsorship reforms
The Government will consider making it easier for sponsored workers to move between sponsors during the validity of their immigration permission, with a view to reducing the risk they will be exploited by being 'trapped' with an abusive sponsor.
Consideration will also be given to implementing 'innovative financial measures, penalties or sanctions' where there is abuse of the sponsorship system. These are said to be aimed at promoting sponsorship compliance and compliance with immigration conditions for sponsored workers.
Expanding the scope of the illegal working regime
The White Paper mentions in passing that measures to tackle illegal working are already being introduced. See our separate article, Draft legislation published on expanded illegal working regime.
Reviewing high talent and business establishment routes
There will be a review of the following routes with a view to increasing uptake:
- Innovator Founder, focusing on building a better pathway for entrepreneurial talent within universities;
- UK Expansion Worker, enabling up to ten workers to be sponsored instead of the current maximum of five;
- Global Talent, focusing making it simpler and easier for science and design applicants to apply;
- High Potential Individual, doubling the number of qualifying institutions but capping the overall number of applicants and seeking to attract individuals with the most benefit to the UK workforce;
- Government Authorised Exchange scheme for research interns, including those interning in the Artificial Intelligence field.
We anticipate the effect of this to be small, as the overall number of migrants in these routes is low.
Raising the level of English language proficiency required to use the immigration system
Revised English language requirements will be applied to main applicants and dependants across more immigration routes, and will include an assessment of improvements to proficiency over time.
Currently, for many work routes including the Skilled Worker route, the required English language proficiency level is Common European Framework of Reference for Languages (CEFR) Level B1 (intermediate user). This will be increased to CEFR Level B2 (independent user).
There are also plans for the proficiency level applicable at settlement stage to be raised from CEFR Level B1 to Level B2. No further details are in the White Paper regarding when this will be made effective, or if any transitional arrangements will apply.
Adult dependants of workers and students are not currently required to meet an English language requirement. A new requirement will be introduced for them to demonstrate CEFR Level A1 (basic user) at their first immigration application, CEFR Level A2 at extension stage and CEFR Level B2 for settlement.
Earned settlement
The Government plans to increase the standard qualifying period for settlement in most immigration routes from five years to ten years, with provisions for some applicants to be eligible in a lower timeframe if they meet (most likely points-based) eligibility criteria intended to demonstrate the individual's contributions to the UK economy and society.
Individuals who are family members of British citizens will not be included in the settlement reforms, and will continue to be eligible for settlement after five years 'provided they have remained compliant with their requirements'.
A consultation on these reforms is planned for later this year. We would anticipate that transitional arrangements for individuals already on a route to settlement will be considered as part of this process.
Earned citizenship
The intention is for citizenship eligibility to be reviewed so that it aligns with the earned settlement proposals. Individuals who can demonstrate greater contributions to the UK will be allowed to qualify sooner than those who cannot.
The Life in the UK Test (which currently applies to settlement and citizenship applications) will be reviewed and refreshed.
The Government will also consider reducing the financial barriers to citizenship (i.e. the application fee) for young adults who have lived in the UK throughout their childhood.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
