Houses of Parliament

After more negotiations and back and forth than many people thought possible, Brexit has finally happened. But what does this mean in practice for global employers who manage a diverse and distributed workforce? Here’s what you need to know.

UK Nationals Working in the EU

31st of December 2020 was the final date for eligibility for the Withdrawal Agreement, allowing UK nationals to continue to live and work in the EU. This would apply to your employees if they had been in the EU for longer than 5 years, or if they have been living there for less time, but they meet the residence conditions of the country, including spending more than 6 months out of 12 months in that location.

From January 1st 2021, UK nationals will need to comply with each EU country’s own regulations for living and working as a non-EU citizen, which vary greatly from country to country. If your employee is a highly-qualified worker, you may be able to get them an EU Blue Card which provides the freedom to live and work in any EU country. The card does not apply in Denmark, (or Ireland, but this isn’t a working barrier for UK nationals regardless) and employees will need a higher education degree, an employment contract, and a competitive salary in comparison to the average for that role in the host country where they wish to work.

The EU Trade and Co-operation Agreement (TCA) outlines that in some limited situations, UK employees may be able to travel for business trips to the EU without a visa, for example to attend meetings, set up a new business, transfer talent, or as a contractor. These trips are limited to 90 days in total over any 180 day period, and it’s important to check the TCA guidelines to make sure you aren’t overstepping the confines of this regulation.

EU Nationals Already Working in the UK

Now let’s look at the other side of the coin, and how Brexit impacts EU employers who have workers in the UK. If your employees are already living and working in the UK, and have been living here since before 31st December 2020, they are likely to be eligible to remain under the EU Settlement Scheme. If your employees already have Indefinite Leave to Remain they do not have to do anything. Otherwise, they can apply here for settled or pre-settled status. Both of these statuses will provide the rights to live and work in the UK, use the National Health Service, and to access public funds such as benefits and pensions. This is an entirely free scheme.

EU Nationals Who May Need to Work in the UK in the Future

Moving forward, once the EU settlement scheme timeline has passed, which happens at the end of June 2021, your employees will need to apply for a visa to work in the UK. As tourists, EU citizens can continue to travel to the UK for up to 6 months without a visa. However, if your employees are planning to work in the UK, this is not enough. The process to apply for a working visa for employees to work in the UK is quite straightforward, and comes under the new Skilled Worker Visa. You’ll need to:

  • Hire this employee as a UK employer (see our Ultimate Guide to EoR if you do not have a local entity in the UK currently)
  • Provide a Certificate of Sponsorship to the employee
  • Check that their role is eligible using its four digit code
  • Ensure that the employees in question can speak, read and write English, for which they may be tested.
  • Pay each employee a salary that is at least £25,600 per year, and more than the ‘going rate’ for that role

The last restriction means that if you pay your employee £50,000 a year to be an IT Engineer, but the ‘going rate’ in the UK is £60,000, the employee will likely not be eligible for the skilled worker visa. The going rates table can be found here.

Remember, you will need to be an approved sponsor to provide a Certificate of Sponsorship. You can apply for a sponsor license if you’re eligible, which takes 8 weeks to process, and costs £536 for small businesses and for charities, and £1,476 for larger businesses and enterprises.

With a Skilled Worker Visa, employees can work, study, and even apply for additional work in the UK for up to 5 years, and this can then be renewed as necessary, or the employee can also apply for Indefinite Leave to Remain after the 5 years are complete.  They will not be eligible for social benefits such as a State Pension, under the Skilled Worker Visa.

The Exception: Global Talent Scheme

In exceptional cases, employees may not need a visa at all to work in the UK, if they come under the eligibility criteria of the Global Talent Scheme. This allows leaders or potential leaders in the fields of academia or research, arts and culture, or digital technology to work in the UK with their family for up to 5 years, after which time it can be extended. As with the Skilled Worker Visa, applicants will have a decision on their application within 3 weeks if they are currently outside of the UK.

The costs are £152 for the application, or £97 from certain EU countries, including Germany, France, Netherlands, Norway, Spain, and Turkey. If you are relocating a family, there will be an additional charge of £608 per person for the partner and children of the employee. Lastly, there will also be a healthcare surcharge of around £624 per year for each person applying.

Seasonal Workers

Another option for some employers will be to apply for your staff to receive a temporary or Seasonal Work visa. The UK government has announced that they will offer 30,000 of these in 2021, and that these will allow EU nationals to live and work in the UK for up to 6 months. It will cost £89 from most EU countries, and your employees will not be eligible for public benefits, or be able to bring family members with them, unlike with the other kinds of visa applications we have listed above.

A Note on Taxation: For all of these use cases, one element of Brexit that reduces complexity is that the UK will keep its double taxation treaties with all EU countries, simplifying the ability to profitably work across borders.

Ensuring Compliance and Alignment with the New Post-Brexit Employment Landscape

It’s important to recognize that even before Brexit happened, there was no single market for employment or services between the UK and the EU, so employers always had to consider the complexities of local laws and compliance when it came to working agreements. There’s no doubt however, that Brexit has made this even more complicated for today’s global employers.

Managing a global and diverse workforce means always keeping your finger on the pulse of the latest economic movements and changes. An intelligent workforce management system automates and streamlines your people and payroll, aggregating all information into a single location, providing complete visibility without the need to back up information by single geographies or providers.

Papaya Global maintains a powerful Center of Excellence model, where we house experts on legalities, compliance regulations, cultural considerations, and any other practicalities surrounding global events such as Brexit. We are available to answer questions or concerns about how Brexit or any other event will impact your own organization and its unique business context, and as always, we’re here to help.

Learn more about Papaya Global’s unified platform, offering zero borders and endless growth.

See our UK PEO Service for employers looking to hire in the UK without a local entity