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By Ross Kennedy

How will the new Scale-up visa work and who should apply?

15 March 2022

The UK Government has published more details on the much-anticipated Scale-up visa set to launch this summer and make it easier to bring the world’s top talent to Britain’s flourishing scale-up sector.

Hailed as “the biggest visa improvement in a generation,” by the Coalition for a Digital Economy, Chancellor Rishi Sunak first heralded a “plan to make our visa system for international talent the most competitive in the world” in his last Budget speech to MPs, the new Scale-up visa at the centre of the Government’s UK Innovation Strategy.

The March 2022 202 page Statement of Changes in Immigration Rules now implements the next stage of changes to the UK’s post-Brexit immigration system. New work routes include the Government’s flagship Scale-up visa, Global Business Mobility and High Potential Individual.

After reading through the March Statement of Changes and Explanatory Memorandum, it is clear that there will be many clients who will benefit from the new immigration route which launches on 22 August 2022. So what do we know now about how will it work and who stands to gain?

What is the Scale-up visa?

With applications opening in August, the Scale-up route is intended for UK Scale-ups to recruit talented individuals with the skills to enable the Scale-up business to continue growing. It is a five-year route to settlement that, although initially sponsored by an eligible Scale-up, transitions into an unsponsored route. A dependent partner and dependent children can join a Scale-up Worker on this immigration path.

The Scale-up route has been promoted by the UK Government as a smoother, more flexible, fast-track route, intended to complement other sponsored work routes like Skilled Worker and the new Global Business Mobility routes. Unlike the Skilled Worker category and the Senior or Specialist Worker route under the Global Business Mobility category, there is no Immigration Skills Charge.

Rishi Sunak heralds ScaleUp Visa
Rishi Sunak heralds Scale-Up Visa in Budget address

How does the Scale-up route work?

The Scale-up Worker visa involves two stages.  The first two year stage requires a job offer from an eligible Scale-up sponsor and the applicant will need to meet requirements of sponsorship, skill level and salary, as well as English language and a finance requirement, similar to other sponsored routes. The second three year stage allows existing Scale-up Workers the flexibility to remain without sponsorship, based on previous UK PAYE earnings.

Scale-up Workers will be able to switch to different sponsored roles in the first six months, and after at least six months in sponsored work, Scale-up Workers can undertake any work (including self-employment and voluntary work) except for work as a professional sportsperson or coach.

Who can sponsor a Scale-up Worker?

Sponsored Scale-up visa applicants must have a valid Certificate of Sponsorship from an A-rated Scale-up sponsor that has not been withdrawn or previously used. A qualifying sponsor must be authorised by the Home Office to sponsor the job in question under the Scale-up route. To qualify as a Scale-up, a sponsor will need to show annualised growth in either turnover or staffing of at least 20% for the previous three-year period and that they had a minimum of 10 employees at the start of the period.

Much of the flexibility of this new route is that unlike other immigration routes, a sponsoring employer need only confirm that an applicant is expected to work for them for at least the first six months of their visa.

More details are still set to emerge for sponsors, so please do contact us on 0207 033 9527 or enquiries@vanessaganguin.com if you would like to be kept updated.

Who can apply to be sponsored on a Scale-up visa?

As with sponsoring employees on other visas, there is a genuineness requirement where the Home Office must be convinced that the sponsored individual is filling a genuine vacancy.

The job for which the applicant is sponsored must be an appropriate skill level, demonstrated by selection of an appropriate Standard Occupational Classification from Appendix Skilled Occupations. The job for which the applicant is sponsored must be a minimum skill level of RQF Level 6 (-same as the outgoing Intra-Company Transfer / incoming Global Business Mobility routes and the old Tier 2 visa).

The salary threshold is at least £33,000 per annum (higher than a Skilled Worker’s £25,600). It must be at the going rate for the sponsored job and at least £10.10 per hour. The salary only includes guaranteed basic gross pay and cannot include allowances or other benefits, in the same way as already applies for those on Skilled Worker visas.

In addition to the earnings and skills thresholds above, applicants must meet an English language requirement (at CEFR level B1) and, unless they have lived in the UK for 12 months, must meet the finance requirement (either through holding funds of at least £1,270 for 28 days or through this requirement being certified by the A-rated sponsor).

Contact us on 0207 033 9527 or enquiries@vanessaganguin.com if you may benefit from advice on eligibility or require assistance with the sponsorship process.

How does the unsponsored stage of the Scale-up visa work?

Unique to this flexible immigration route there is a second stage of up to three years, in which Scale-up Workers no longer require sponsorship, as long as previous UK PAYE earnings meet the threshold of at least £33,000 per year during at least 50% of their initial permission to stay as a Scale-up Worker. Earnings must have been recorded through PAYE and cannot come from other sources, such as self-employment or overseas income. However, if an applicant was on statutory maternity, paternity, parental or shared parental leave, statutory adoption leave or sick leave during the relevant period, they will count as meeting the threshold for the duration of that leave. (Though no mention of industrial action in the rules.) As with initial applications and the Skilled Worker category, only gross basic pay will be taken into account.

So for example, if applying after two years under the Scale-up visa, a worker would show that they had sufficient PAYE earnings for at least 12 months during those initial two years. This is in addition to a Scale-up Worker’s English language and finance requirements, which at this stage are likely to be met automatically.

What are the requirements for a Scale-up Worker to settle in the UK?

After five years continuous qualifying residence, Scale-up Workers may be eligible to apply for indefinite leave to remain in the UK.  The continuous residence period can also include time spent in the Skilled Worker, Global Talent, Innovator, T2 Minister of Religion, International Sportsperson, Representative of an Overseas Business or Tier 1 categories (excluding Graduate Entrepreneur).

To be eligible for settlement, the applicant must be in employment in the UK on the date of application with a PAYE salary paid of at least £33,000 per year. Plus monthly PAYE earnings in the UK equivalent to at least £33,000 per year during at least 24 months of the three years immediately before the date of application.

Qualifying earnings and treatment of salary during periods of permitted leave are the same as for scoring points for permission to stay under the unsponsored route above.

Contact us on 0207 033 9527 or enquiries@vanessaganguin.com if you may benefit from advice on eligibility or require assistance with the settlement process.

Can people on the Scale-up visa route bring family to stay and settle too?

Dependent partners and dependent children are able to apply to accompany or join a Scale-up Worker in the UK. Relationship, age and care requirements apply as in similar categories such as Skilled Worker, as does the finance requirement where the dependent applying has not been living in the UK for at least 12 months (£285 for a dependent partner, £315 for the first dependent child and £200 for each additional dependent child).

The sponsor of a Scale-up Worker can only certify the finance requirement for dependants if the date of application is at least one month before the end of the minimum six months that the Scale-up Worker must work for the sponsor.

Dependants will be granted the same amount of permission to stay as the Scale-up Worker, or for three years if the Scale-up Worker has been (or is being) granted settlement. In order to qualify for settlement, dependent partners must complete a continuous period of five years in the UK with permission as a partner of the Scale-up Worker (or former Scale-up Worker, if applicable). Dependent children can apply for settlement if both parents have been / are being granted settlement or sole responsibility rules apply.

Why apply for a Scale-up visa?

The UK Government has hyped its flagship post-Brexit Scale-up visa as a “fast-track” smoother route for eligible employers and employees than the Skilled Worker visa. While the minimum skill level and salary requirements are both higher than the current Skilled Worker visa, the lack of skills charge and the short period of sponsorship may help reduce costs and admin for firms.

There are still some outstanding questions on how the sponsorship side of the process will work in practice and how streamlined it will be, including how and when companies can apply for a licence, and what level of admin will be expected of them.

For talent keen to work with British scale-ups, the attractiveness of the Scale-up visa is that, although they need to work for the sponsor for at least six months, they can also carry out other work at the same time and after their sponsored role ends, including self-employment.

This could be a double-edged sword for employers looking to retain their services. In good news for employers (and head-hunters) they can recruit a Scale-up worker without a further visa application. Yet unlike in other sponsored routes, they are not restricted to working for the sponsor. The flip side of this freedom is that migrants will need to be especially careful to ensure that they accrue enough earnings under a PAYE scheme to score sufficient points for the next step of their visa journey.

Though this could be a double-edged sword for employers looking to retain their services – you can recruit an existing Scale-up Worker without a further visa application but, unlike other sponsored routes, they are not restricted to working for you).  The flip side of this freedom is that migrants will need to be especially careful to ensure that they accrue enough earnings under a PAYE scheme to score sufficient points for the next step of their visa journey.

Why is the Scale-up visa being introduced?

The UK Government is bringing in a raft of measures as part of its plan to make the UK a global innovation hub by 2035 and for many firms they can’t come soon enough. Scale-ups rely heavily on international talent. For 21% of scale-ups surveyed in the 2021 Scaleup Institute annual review, a quarter or more of their staff come from outside the UK.

The British tech sector employs over three million people yet the number of open adverts for tech vacancies is 42% higher than pre-pandemic levels in 2019, according to a recent report from Tech Nation and jobs search engine Adzuna.

The latest immigration statistics released this month show skilled work, which accounts for 63% of work-related visas granted, saw the largest growth in visa numbers between 2021 and 2019 – an increase of 37,551 or 33%. With no more free movement with the EU and post-pandemic investment boom for start-ups and scale-ups there is an increasing need for quick and easy ways for employers to tap up talent from around the world.

For more information on the Scale-up visa and other new immigration routes announced this year, contact us on 0207 033 9527 or enquiries@vanessaganguin.com.