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Tech Start-Ups – Hiring from Overseas

If you are a tech start-up, finding the right talent is critical to the future success of your venture.

However, according to a recent parliamentary report, ‘Digital Skills Crisis‘, the current domestic market is in short supply of skilled digital workers.

This is leading tech businesses to look overseas for personnel with the right skills and experience to fulfil their business needs.

Whereas larger, established employers are able to call on their HR or global mobility functions, immigration law can be a new area of risk for smaller companies and start-ups.

When do you apply the Resident Labour Market Test? How to select the right entry route? What is the visa application process? Get it wrong and you could miss out on your candidate or even find yourself under Home Office scrutiny.

Hiring digital workers from overseas 

There are a range of UK entry options available to skilled workers from outside the EEA, including some which offer preferential entry for digital talent.

For example, the Tier 1 Exceptional Talent Visa was introduced as a special measure by the government to help ease domestic skills gaps in technical fields such as tech.

In another move to help attract specialist talent needs from overseas, categories of digital workers have also been added to the Shortage Occupation List (SOL).

The SOL was developed to provide employers with a number of advantages when applying for a Tier 2 visa.

Tier 2 Sponsor Licence is required by businesses seeking to hire workers from outside the EEA. There is a strict application process, which includes a visit from UKVI, and a requirement to renew your licence on an annual basis.

If you are successful in your sponsor licence application, you are permitted to hire workers from outside Europe by issuing Certificates of Sponsorship (CoS) to each individual.

A CoS is a unique reference number which individuals use as part of their Home Office application for leave to enter and remain in the UK.

There are two types of CoS, the unrestricted CoS and restricted CoS. They each have different uses and entail different processes for employers.

Unrestricted Certificates of Sponsorship

Unrestricted CoS are used for:

  • New employees with a salary of more than £155,300
  • Switching within the UK to the Tier 2 (General) visa
  • Extensions

When you apply for your licence you will be asked to estimate how many Tier 2 certificates you will require. You will then be granted fixed allocations of unrestricted CoS on a yearly basis as part of your sponsor licence.

Any unrestricted CoS issued by you must come from your allocation. You must issue the unrestricted CoS to the overseas worker within three months of allocation and within six months of first advertising the vacancy.

Individuals must then apply for Tier 2 clearance within three months of receiving the CoS.

Restricted Certificates of Sponsorship

Restricted CoS are intended for:

  • New employees applying from outside the UK to enter under a Tier 2 (General) visa and who will be earning under £155,300 per annum
  • Individual dependants of Tier 4 students applying from the UK wishing to switch to a Tier 2 (General) visa

There is an annual restriction in place on the number of migrant workers admitted to the UK from outside the EU under a Tier 2 (General) visa on restricted CoS.

UKVI review all applications for restricted CoS on a monthly basis. Those requests which meet the points criteria (minimum 32 points) are approved. If the restrictive allocation limit is oversubscribed, applications are prioritised according to a points table. The available restricted CoS are allocated based on the highest points scored. Points are awarded based on whether the job is in a shortage occupation, a PhD-level occupation, and the salary on offer.

There are no guarantees if and when restricted CoS applications will be approved.

Restricted CoS applications work to a monthly schedule. UKVI request all submissions and supporting information online by the 5th of every month. UKVI will then consider applications on the 11th, and notify applicants within 5 working days. The latest numbers are published each month.

If CoS is granted, the employer assigns the CoS to the individual, who can then use the reference number to apply to the Home Office for entry permission.

One exception to note is that while a CoS assigned to a Croatian national is included in the permanent limit, you should assign an unrestricted CoS, not a restricted.

Any restricted CoS unallocated after three months will be automatically returned to UKVI for reallocation.

Do you need help with a sponsor licence application or Certificates of Sponsorship? 

For start-up businesses, employing talent from overseas can appear complex and burdensome. But with the right guidance you can meet your duties and ensure compliance in a way that is both commercially viable and supportive of your business needs.

We are highly experienced advisers to employers and start-ups on all business immigration matters, including applications for Sponsor Licences and Certificates of Sponsorship. For more information, or for help and advice on any immigration legal matter, please get in touch.

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