EU Settlement Scheme, settled status and your Company

Employers – are you encouraging your employees to apply for settled status? The arrival of the 1st January 2021, and therefore the end of the Brexit transition period, marked the moment where free movement between the UK and EU nationals was over. New rules applied… and as an employer, you need to be clear about them to make sure you avoid putting yourself in a situation where you end up employing workers illegally or possibly even facing accusations of discrimination.

The first question is of course whether there’s anyone you employ who is affected by this. Depending on the size of your company that might be quite straightforward to establish but in other cases, it might require a formal audit. Be aware that this also applies to non-EU, EEA and Swiss nationals as they are also part of the EU single market arrangements – so when we say EU in this article, it includes them too. Also note that movement between Ireland and the UK is exempt from this: if you’re wondering why, it’s because the relationship is actually regulated by the Ireland Act 1949 – which was agreed before the two countries joined the EU.

You are not responsible for the settled status of your employees or their EU Settlement Scheme applications

If you do have anyone affected, it’s important to be clear on this: it is not down to you as their employer to make the application for settled status. In fact, you must not offer any form of advice about what they should do. You are under no legal obligation to communicate any information about the EU Settlement Scheme either.

What you can do if you choose to however is to make all employees aware of the scheme, highlight the application deadline of 30th June 2021 and direct them towards the Government pages to help them find all the information they might need including where they can make their application for settled status. As well as needing to sort out their settled status to keep their right to work in the UK, it will be needed for many other aspects of living in the UK like accessing education and healthcare so it is very much in their interests to get it sorted as quickly as possible.

What are the implications for EU nationals who lived in the UK before the transition period ended?

The withdrawal agreement requires that all EU nationals (including those with a registration certificate or permanent residence card) who were living in the UK by 11.00pm on 31st December 2020 to apply under the EU Settlement Scheme for either settled status or pre-settled status. As mentioned above, they need to do this by the 30th June 2021. Dependents must apply too.

Once they’ve applied, anyone who has lived continuously in the UK for five years or more will be granted settled status. There are some exceptions in terms of what ‘continuously’ means: for example, if someone had to spend longer outside the UK due to significant reasons like serious illness, then there is flexibility to accommodate that. Flexibility due to the pandemic’s impact has also been built into the system too, recognising that people might have found themselves unable to return to the UK because of restrictions in place.

Settled status means that the person can both live and work in the UK indefinitely. The only way that they can lose settled status is if they leave the UK for more than five years.

If someone has lived in the UK for less than five years, they must apply for pre-settled status to live and work over here. Once they’ve been a resident in the UK for five years, it can be converted to settled status. There is a caveat to that though: any absences from the UK for more than six months in any 12-month period could affect that conversion so it’s something to be mindful of. The only way to lose pre-settled status once it’s been confirmed is to leave the UK for two consecutive years.

Carrying out right to work checks for new employees who are EU nationals

As you should already be aware, you are responsible for checking that before you employ someone, they have the right to work in the UK. If you don’t comply with that, you could face both civil and criminal penalties. At the moment, there haven’t been any changes. You can use EU passports or national identity cards to confirm the right to work of an individual. But from 1st July 2021, new rules will apply.

At that point you can check an individual’s status under the EU Settlement Scheme via the employers’ online service for EU citizens and their family members. You will need the individual to provide you with a “share code” to do so.  But be very clear – you can only require potential new employees to share their status after the 30th June. If you insist on it before (or on) that date as a condition of employment, that is a form of discrimination.

Stepping aside for a moment – remember,  you will have to check original documents from 17th May 2021 rather than scanned documents or photos of right-to-work documents.

What about your existing employees?

As things stand, you will not be expected to check that your existing employees have applied to the EU Settlement Scheme. The right to work checks already completed should be sufficient and you are not expected to conduct retrospective checks for current employees. Be aware of the fact that you cannot ask employees about their settled status as that also carries with it the risk of race discrimination.

You will find more information about right to work checks here. It also has links to explain what needs to be done to access sponsor licences.

Do you need some guidance?

Companies already wrestling with a raft of changes from Brexit, alongside everything else they are dealing with because of the pandemic, may not be delighted by the prospect of having to get to grips with this too.

But it’s important to be aware of what the implications could be for your organisation; as well as ensuring you are employing workers legally, you need to be alert to the potential for discrimination and also be aware of any issues that could arise through recruitment challenges and the possible loss of talent. If you need any help in identifying what steps should be taken in your company, or in understanding how the scheme relates to specific individuals, then please do contact us to discover how we can support you.

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