Blog - 12/09/2022
New UK Scale-up visa launched – what does this mean for businesses and individuals
The Scale-up visa launched on 22 August and provides a route for UK businesses, that have demonstrated a sustained period of growth, to sponsor talented individuals in highly skilled roles. This is an initial sponsored route which means individuals must first be sponsored by a ‘Scale-up Sponsor Licence holder’. This is a points-based category and therefore individuals must meet a total of 70 points whether applying under the ‘sponsored’ or ‘unsponsored’ route.
How does the Scale-up visa work?
There are two stages to the Scale-up visa which an individual can apply for:
- ‘Sponsored’ route of 2 years with a ‘high-growth business’ that holds a Scale-up licence;
- ‘Unsponsored’ route of 3 years.
For those individuals entering this route for the first time, they must first be sponsored by a business that holds a Scale-up Sponsor Licence. Businesses that do not have a Scale-up licence may apply for one providing they meet the following criteria (NB businesses already holding a Skilled Worker licence may also apply to add this limb if they meet the following criteria):
- Annualised growth of at least 20% for the previous 3-year period based on either employment count or turnover;
- A minimum of 10 employees at the start of the relevant 3-year period.
UK Visas and Immigration will assess the above criteria using data submitted by the business to HM Revenue and Customs regarding Pay As You Earn (PAYE) information and/or VAT returns.
Business that apply and meet the above criteria will be granted the Scale-up licence for a period of 4 years. Unlike many other sponsorship routes, sponsors are not permitted to renew the Scale-up route beyond the four years – this is a temporary route.
Individuals making a sponsor application under the Scale-up route must meet 70 points in total. 50 points will be awarded providing the individual meets the following requirements:
- In possession of a Certificate of Sponsorship issued by an A-rated Scale-up sponsor – this will confirm the details of the employment the individual will be performing and confirm they will be employed for at least 6 months;
- The role must be at RQF Level 6 (graduate level or above) – found in Appendix Skilled Occupations;
- Paid the appropriate salary threshold – either an annual basic salary of £33,000 or the going rate for the relevant occupation code, whichever is the highest.
The remaining 20 points will be met by meeting the English language requirement and the financial requirement – same as those applying under the Skilled Worker route.
Successful applicants will be granted permission to stay as a sponsored Scale-up worker for 2 years. For the first 6 months of their permission, a sponsored Scale-up worker must work for the sponsor in the employment stated on their Certificate of Sponsorship. After the initial 6 month period has passed, the individual will have full access to the UK labour market and they may therefore either continue to work for the same employer or join a different employer, without needing to apply for a new visa.
Individuals making an unsponsored application under the Scale-up route must also meet 70 points in total. 50 points will be awarded providing the individual:
- Already holds permission as a Scale-up Worker; and
- Have PAYE earnings in the UK equivalent to at least £33,000 per year during at least 50% of their visa permission as a Scale-up worker.
When calculating whether an individual has met the relevant earnings test, UKVI will only consider gross basic pay – individuals cannot include earnings from self-employment or from outside of the UK. If an individual has more than one job, they can rely on earnings from different employments, however, they must be from different months.
Successful applicants will be granted permission to remain as an unsponsored Scale-up worker for 3 years.
This visa category leads to settlement (Indefinite Leave to Remain) after 5 years continuous residence in the UK – the 5 year period may also include time with other qualifying visa categories. Individuals must also meet the absences requirement and knowledge of language and life in the UK.
The applicant must also demonstrate that at the date of settlement application, they are in employment in the UK with a salary paid through PAYE of at least £33,000. Secondly, they must show they have had monthly PAYE earnings in the UK equivalent to at least £33,000 per year during at least 24 months of the 3 years immediately before date of application.
Benefits and limitations
Whilst this visa category appears to have benefits that may make this category attractive to both individuals and businesses, there are certain limitations with the route which may lead to low-take up of businesses applying for a Scale-up licence.
Firstly, the Scale-up licence is a temporary category – whether a business already holds a licence and is applying to add the Scale-up as a limb, or a business is applying for a licence for the first time, if granted, the licence is valid only for 4 years. Businesses cannot apply to extend the Scale-up limb beyond 4 years which may discourage some businesses from applying in the first place.
The criteria to qualify as a Scale-up sponsor will not apply to all businesses – the criteria which effectively determines whether a company is classed as high growth will apply only to a handful of all UK businesses – the impact of the visa category may therefore not be as significant as the Government hopes.
Sponsors may also be unable to prevent an employee from leaving once they have completed the initial six month period. Since the Immigration Rules allow an individual to become “unsponsored” once they have completed the initial six month period, it is difficult to see how employers can prevent an individual from leaving the organisation – this again may discourage employers from sponsoring workers under this category.
Nevertheless, the Scale-up route does mean employers will not be required to pay the Immigration Skills Charge as part of a sponsored application. Furthermore, sponsorship duties automatically falls away once the employee has been employed for the initial six month period. There is also greater flexibility in terms of the role the individual may perform for the business with the ability to work in different roles for the business without the need to make a change of employment application.
From the individuals perspective, the ability to be “sponsor free” after the initial six month period on the sponsored route may be appealing – this is a big difference to the Skilled Worker category. However, individuals will still need to prove certain earnings requirements at settlement stage.
If you are a business considering applying for a Scale-up Sponsor Licence or an individual seeking further information on this immigration route, please do not hesitate to contact Sundeep Rathod from our Immigration team.
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Please note that this blog is provided for general information only. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content of this blog.
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