What would a Labour government promise for business immigration?

19 June 2024

Sectors of the economy hit by a massive recent hike in salary thresholds for sponsoring skilled workers will be poring over its manifesto for clues as to how a likely Labour government may affect their ability to bring workers into the UK.

The Conservative Party manifesto has reiterated its recent immigration-curbing policies and promised to go much, much further, with annual, ever-tightening caps on immigration numbers.

The Liberal Democrats who also have the luxury of making more concrete promises, have a fabulously detailed election manifesto when it comes to immigration, including replacing salary thresholds with a “merit-based system” for work visas.

As a party with a constant lead in the polls that they are determined not to jeopardise in any way, the Labour Party manifesto is thinner on details and concrete reassurances when it comes to work immigration. So, below is what we can infer based on what’s there, what’s missing and what the party have recently said.

Labour vows to reduce net migration

The Labour manifesto’s section on “A fair and properly managed immigration system” appears in the “Kickstart economic growth” chapter of the Labour manifesto – perhaps an acknowledgement of immigration’s important role in economic growth.

Though there is not much substance in the manifesto for employers to rely on, the main headline-grabbing Labour promise is a vow to reduce net migration.

The manifesto contains an interesting commitment to “reform the points-based immigration system so that it is fair and properly managed, with appropriate restrictions on visas, and by linking immigration and skills policy” which suggests a wide-ranging review.

There are no reassurances for employers and employees hampered by recent Skilled Worker salary threshold hikes, or indeed for residents whose salaries fall below an increasing minimum income to be joined by a partner/spouse on a family visa. Nor for sectors that can no longer rely on hires enjoying the discounts of the scrapped Shortage Occupation List.

Conspicuously absent from the manifesto are recent press briefings that Labour would ask the Migration Advisory Committee (MAC) to properly examine April’s arbitrary salary hikes for sponsoring partners/spouses and Skilled Workers. One would hope that these changes which were made with no consultation would be looked at by the MAC as part of the Labour Party manifesto promise of “reform of the points-based immigration system.”

Work visas for filling shortage occupations

Despite tough talk of reducing reliance on immigration, the manifesto contains a commitment to empowering the Migration Advisory Committee to make informed decisions – which would suggest a return to consultations with stakeholders and evidence-based immigration policy again, rather than recent headline-grabbing policies to reduce legal migration made with no consultation. Hopefully, submissions from sectors and stakeholders will be taken into account by the Committee if they have the opportunity for a full consultation as has usually been the case.

The MAC has been very critical of the government’s decision to remove the Shortage Occupation List at the same time as increasing Skilled Worker salary going rate minimums to the median of an occupation code. There are very few occupations left on the Immigration Salary List as without a 20% discount on the new far higher going rates, there is no point in most occupations suffering skills shortages appearing on the new list. A Labour Party which has for a long time criticised a discount on the going rate as undercutting local wages is unlikely to bring such a discount back for occupations with chronic skills shortages.

“The days of a sector languishing endlessly on immigration shortage lists with no action to train up workers will come to an end,” the Labour manifesto vows. “Labour will bring joined-up thinking, ensuring that migration to address skills shortages triggers a plan to upskill workers and improve working conditions in the UK.”

Linking work immigration to skills and training

“We will strengthen the Migration Advisory Committee, and establish a framework for joint working with skills bodies across the UK, the Industrial Strategy Council and the Department for Work and Pensions,” the Labour manifesto promises.

Elsewhere in the manifesto it adds: “We will establish Skills England to bring together business, training providers and unions with national and local government to ensure we have the highly trained workforce needed to deliver Labour’s Industrial Strategy. Skills England will formally work with the Migration Advisory Committee to make sure training in England accounts for the overall needs of the labour market.”

All of this suggests immigration and training policies will be part of a long-term industrial strategy. The MAC when reviewing the Shortage Occupation List and the Immigration Salary List that replaced it has in the past suggested opening up the immigration options it may recommend when occupations are in short supply, with recommendations including long term training and skills strategies so that immigration is not a permanent fix. So with a return to the Shortage Occupation List looking unlikely, it will be interesting what other solutions the MAC may recommend for sectors left in the lurch by its demise.

Sponsor licence compliance and enforcement

“Bad bosses” has been a recent refrain for the Labour leader and colleagues who during the election campaign have associated breaching employment regulations with relying on non-resident labour. Associating an erosion of local workers’ rights with immigration is a dangerous populist trope.

Employers who “abuse the visa system” or breach employment law will be barred from hiring workers from abroad, the Labour manifesto warns. This may imply more or tighter enforcement, but current sponsor obligations already include wide-ranging requirements to play their part in ensuring the immigration system is not abused, comply with wider UK law (including employment and equality law) and not behave in a manner that is not conducive to the public good, with employers who breach these facing compliance action.

This then appears not to be a question of policy but of enforcement. However, over the past few months the Conservative government has already increased civil penalties, dedicated more immigration enforcement staff to more compliance visits on employers with sponsor licences.  During the year to the end of Q1 2024, Home Office data reports a 90% increase in Skilled Worker licence suspensions and a 20% increase in Skilled Worker licence revocations on the same period a year before.