In the wake of Brexit and the pandemic, the UK has experienced significant staff shortages, with current vacancies across the UK reportedly standing at 1.1 million as of February 2023. The hospitality sector has been particularly affected, with the ONS recently reporting a 72% increase in vacancies compared to pre-pandemic levels.
The end of free movement has had a particularly significant impact on the hospitality sector. The number of EU nationals within the sector now accounts for approximately 30% of the workforce, whereas pre-pandemic this figure exceeded 40%.
Post-Brexit EU nationals are subject to the same immigration regime as any non-UK nationals. This means that EU nationals wishing to come and take up a job in the UK will usually need to be sponsored by a UK based employer. In other words, they will need a “work permit” to do so.
To be eligible for sponsorship in the Skilled Worker category, they must be undertaking a skilled role, typically one which is at Level 3 or above on the Regulated Qualifications Framework (RQF). This is a role that has been assessed as requiring a level of education equivalent to A Levels/high school leavers. They also need to meet minimum salary requirements associated with both the immigration route and the specific role which they are undertaking.
Many jobs within the hospitality sector are not classified as being sufficiently skilled to meet these eligibility requirements or are not paid sufficiently well to meet the salary thresholds. This means that UK businesses looking to recruit into these roles have no access to this immigration route. Home Office Management Information indicates that only 3% of all Skilled Worker visa applications related to roles within the hospitality sector in 2022. Of these applications, chefs made up the highest proportion of visa applications (60%).
One answer to this problem potentially lies with adding relevant roles to the Shortage Occupation List (SOL). The benefit of being on the SOL is access to more favourable migration arrangements; individuals become eligible for sponsorship based on reduced salaries and applications attract slightly lower visa fees.
This in turn means that employers are able to access a wider pool of workers to fill their vacancies. However, roles will only be considered for addition to the SOL where there is a genuine shortage (in other words where UK employers are unable to fill their vacancies in these areas).
The hospitality industry has lobbied repeatedly for hospitality roles to be added to the SOL to facilitate employer sponsorship to help organisations address the labour shortages within the sector.
The Migration Advisory Committee (MAC) (which provides independent advice to the government concerning immigration policies) is currently reviewing the SOL with a view to ensuring it remains fit for purpose. There were high hopes that industry pressure might result in some positive changes to the SOL for the sector.
However, the latest Government response delivered alongside the Spring Budget has delivered a blow to these hopes. The Government announced that it was accepting the MAC’s interim recommendations in relation to the construction and hospitality sectors, adding five construction roles to the SOL. However, the MAC has refused to recommend that any hospitality roles be added.
Breaking down their conclusions:
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The MAC decided not to recommend that any roles falling within RQF Levels 1-2 should be added to the SOL at this interim stage. They commented that any such recommendation would be “exceptional and based on particularly strong evidence”. However, there is current precedent for using the SOL in this way; this was the approach taken by the Government in relation to Care Workers. Care Workers would not normally be eligible for sponsorship because they do not meet the skills threshold, but the Government has implemented a temporary concession given the labour shortages being experienced by the care sector.
The wider MAC review remains open until 26 May 2023 with their full findings expected in the Autumn. As part of their more detailed review, the MAC has left the door open to stakeholders making representations on this specific point.
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In relation to the other hospitality roles under consideration (i.e. those at RQF Level 3 or above), the MAC concluded that it did not have clear evidence that these roles were in “shortage”. They also concluded that they were not prepared to recommend a lower salary threshold be applied, given that wages in these roles are typically aligned closely to the National Minimum Wage.
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They specifically addressed Chefs and their inclusion on the SOL.
For context, chefs used to be included on the SOL, until they were removed in April 2021 in what was described as a “hugely disappointing” step by Kate Nicholls, chief executive of UKHospitality.
The MAC commented that they were not minded to add Chefs back onto the SOL given the evidence before it. They said that:
‘There still appears to be little progress in improving terms and conditions, and in particular pay growth continues to be driven to a large extent by the statutory minimum wage. It is unclear how the sector foresees sustainable domestic recruitment and retention for this skilled occupation when wages remain so low.’
Again, however, the MAC reiterated that they remained open to representations made through the Call for Evidence prior to the May closing date.
Hospitality sector businesses should take advantage of this opportunity to provide evidence-based feedback where they disagree with the approach.
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Finally, they considered whether Sommeliers should be recategorized so that the skill level is upgraded from where it currently sits, at RQF Level 1-2 to RQF Level 3. This would immediately make the role eligible for sponsorship within the Skilled Worker route.
The MAC responded that they had not had sufficient time to reach a conclusion on this point.
They invited hospitality organisations to provide evidence about the skills associated with this role, and, in particular, the training requirements, so that they could consider it as part of their full review. On an even more positive note, they commented that they were “certainly receptive to this request”, which certainly sounds like any representations would be pushing at an open door.
So, as things currently stand, what are the alternatives for businesses looking to recruit non-UK nationals into the sector? There are a number of immigration routes that do not require sponsorship and which allow individuals to work in any role for any employer.
These include the graduate visa (a 2 or 3 year visa for international students who have studied and graduated in the UK) or the Youth Mobility Scheme (which allows nationals from certain countries within certain age brackets to come to the UK for up to 2 years). The Youth Mobility Scheme is particularly interesting given recent expansions in scope as a result of post-Brexit trade deals with, for example, Australia, New Zealand and India. (Interestingly, the MAC response noted that they have “long argued that expanding the YMS to more countries would be beneficial, and this is likely to be particularly so for hospitality”.) However, the problem with these options is that they usually only delay the need for sponsorship to a later date and are therefore not a long-term solution.
Whilst the sector awaits the outcome of the full MAC review later in the year, businesses will no doubt be looking to redouble their efforts to fill their vacancies from within the resident labour market pool, focussing on presenting attractive recruitment opportunities and retaining existing staff.
In the meantime, we strongly recommend that businesses respond to the MAC’s call for evidence with a view to achieving positive change.
