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The Scale-Up Visa is a new visa route for immigrants to the UK, which goes live on 22 August 2022. Applicants require a job offer from an authorised UK scale-up company. Unfortunately, at the time of writing we are still waiting for detailed guidance from the Home Office on how employers register for this route with the launch now only days away.
What we do know is that employers will need to demonstrate that they have an annualised growth of at least 20% for the previous 3-year period in terms of turnover or staffing. Companies will also need to have had a minimum of 10 employees at the start of this 3-year period. It seems likely that employers will register through the existing sponsor licence system. If this is the case then presumably employers with existing sponsor licences to sponsor skilled workers could add this route to their licence after demonstrating eligibility to the Home Office. Alternatively, employers currently without sponsor licences could apply to the Home Office for a licence to sponsor employees for Scale-Up Visas and/or Skilled Worker Visas.
Sponsorship is only available for roles that are skilled to at least RQF level six (graduate level) which is higher than the level required for Skilled Worker Visas. In addition, the minimum salary for the Scale-Up Visa is slightly higher at £33,000. Applicants will also need to meet the English language and maintenance requirements.
A major advantage of the Scale-Up Visa is that it incurs no Immigration Skills Charge. This can save employers up to £1,000 per year for each visa.
One of the interesting aspects of the Scale-Up Visa is that while applicants require sponsorship for the initial application and must remain in employment with the sponsor for an initial period of at least 6 months, after this they are no longer required to stay with the original sponsoring employer. Applicants are then free to undertake additional or alternative work (including self-employment) without sponsorship. When the applicant applies to extend their leave, this can be via an unsponsored application, whereby they only need to demonstrate that since their original permission they have had monthly PAYE earnings in the UK equivalent to at least £33,000 per year during at least 50% of the most recent grant of permission as a Scale-up Worker.
After 5 years of continuous residence, Scale-Up Visa holders will be eligible to apply for indefinite leave to remain. They can also combine time spent on the Scale-Up Visa with certain other routes such as the Skilled Worker Visa. Applicants need to be in employment earning at least £33,000 on the date of the application and have had PAYE earnings equivalent to at least £33,000 per year during at least 24 months of the last three years immediately before the date of the application. Applicants can also sponsor their partners and children as dependants.
The Scale-Up Visa has a number of advantages for applicants including the fact that it affords flexibility to work for other employers or even to set up a business. The costs savings on the Immigration Skills Charge are also attractive for employers.
However, the flexibility is potentially a disadvantage for employers who are likely not going to be pleased with the fact that employees can easily leave after a short period of time after putting in the effort and costs to sponsor them. Employers may be able to mitigate some of the risks through well-drafted claw-back agreements with employees. However, the complexity of the eligibility requirements for these visas means that they will likely only be of use in certain niche circumstances.
When ex-Chancellor Rishi Sunak announced the Scale-Up route in his autumn 2021 Budget, he noted that this would make it quicker and easier for fast-growing businesses to attract the “best and brightest minds”. While the Scale-Up Visa will be attractive to some, it seems likely that this route will be largely ineffective for attracting talent and unappealing to most employers.
Employers continue to struggle with labour shortages and this is particularly the case for specific sectors such as hospitality and manufacturing, where the skills requirements rule out many job roles from being eligible for sponsorship. The costs and administrative difficulties in applying for visas also make it difficult for many employers to get visas, particularly for shorter-term projects. Unfortunately, this new visa route will likely do little to address these issues. It is clear that there is still a need for routes that are simple, flexible and attractive to both employers and visa applicants.
This article has been produced for general information purposes and further advice should be sought from a professional advisor. Please contact our Business Immigration Team at Cleaver Fulton Rankin for further advice or information.