Immigration minister Robert Goodwill, speaking at the Lords EU home affairs sub-committee on Wednesday (11 January), told peers that the Brexit vote indicated that voters felt companies were relying too much on migrant workers to fill vacancies. The charge would “be helpful” to British workers who would otherwise be “overlooked”, he said.
However the proposal has been met by much criticism, with one business group telling the BBC that the idea had “raised eyebrows”.
A recent survey within the hospitality industry revealed that 43% of workers employed within the industry (restaurants, hotel, and quick service restaurants) are foreign nationals, with restaurant kitchens employing the most overseas workers.
Gerwyn Davies, labour market adviser at the CIPD, said: “The introduction of a skills levy could be one of the more unhelpful policy interventions from an employer’s perspective. Organisations are already having to contend with rising labour costs through schemes such as the apprenticeship levy, while responding to a fall in the supply of EU migrants that is partly the result of a weaker pound.”
Josh Hardie, CBI deputy director-general, commented: “Extending the system that currently applies to workers from outside the EU, including the immigration skills charge, would neither meet the needs of our economy nor be appropriate.”
Downing Street has since dismissed Goodwill’s proposal, insisting the minister’s comments had been “misinterpreted”. However, a similar levy for skilled non-EU workers will be introduced this April, leading to fears that it could be extended to include skilled EU workers following Brexit.
Under the existing scheme, otherwise known as the immigration skills levy, larger organisations that recruit workers from outside the EU will need to pay £1,000 per recruit while smaller businesses and charities will pay a reduced rate of £364.
Annabel Mace, head of business immigration at Squire Patton Boggs, said that extending the immigration skills levy to include skilled EU workers post-Brexit would be “extremely damaging” for UK organisations. “Employers shouldn’t be penalised further for trying to fill roles with the skilled workers they need,” she said.
In December, the Independent reported that despite “unchanged” net migration figures in the year preceding Brexit, unemployment was at its lowest levels for a decade.