What is the change?
The new Rules state that any payments made by a sponsored worker to their employer, such as salary sacrifice schemes, loan repayments or investments into the business, will be deducted from their pay when determining if they meet the minimum salary requirements for a Skilled Worker visa. The deductions will be averaged over the length of time the worker is sponsored for.
If, after these deductions, the salary still meets the requirements of the Skilled Worker route, then the role may still qualify for sponsorship. However, if the reduced salary is below the minimum salary requirements for the role, then it may not qualify for sponsorship under the new Rules.
Why has it been made?
In the Explanatory Memorandum, the Home Office states that these changes are being made:
- For consistency with how paid allowances for the same purposes are treated.
- To mitigate against sponsorship costs being passed on to applicants.
- To close an unintended loophole whereby applicants could effectively pay towards their own salary through investing in their sponsor's business.
What do these new Rules mean in practice for employers?
In practice, this means that from 9 April 2025, employers sponsoring Skilled Workers will need to assess and ensure that a worker's salary meets the required minimum salary thresholds after deducting the relevant payments (deductions from salary, loan repayments and investments).
Employers should be aware that this includes repayments made to the applicant in relation to immigration costs, such as the visa application cost and the immigration health surcharge. Restrictions on passing on certain immigration costs to sponsored workers, such as the Certificate of Sponsorship and the Immigration Skills Charge, remain in place.
This new change could have significant implications for employers with sponsored workers and certainly adds a further layer of complexity when assessing Skilled Worker salaries. We recommend that employers review their current and prospective sponsored workers' salaries to assess if they meet the new requirements after these deductions have been made.
If you would like to discuss these changes and how they may impact your business, please contact a member of our Immigration team and we would be happy to assist.
