Tier 2 of the PBS replaced the work permit scheme and includes permissions for sponsored migrants to work in the UK for a particular employer in a particular role which must be recognised as skilled. To be able to sponsor migrants under Tier 2 an employer must first apply for a sponsorship licence (which includes an estimate of the number of certificates required for the next 12 months) and then issue a certificate of sponsorship (this replaced the old work permit).

Tier 2 comprises of four permissions including general (which currently can be used if an employer has undertaken a recruitment campaign and no suitably qualified settled workers applied for the role, or the role on offer is a recognised shortage occupation), intra-company transfer (which can be used to bring employees from overseas offices to the UK), sportsperson and minister of religion.

The permissions most frequently encountered by employers are Tier 2 (general) and Tier 2 (intra-company transfer). Points are currently awarded for either the employer having undertaken a recruitment campaign or the role being a recognised shortage occupation (to be able to issue certificate under Tier 2 (general)) or the migrant transferring from an overseas office (to be able to issue a certificate under Tier 2 (intra-company transfer)), as well as the salary on offer, the migrant’s qualifications and knowledge of english, and the migrant holding monies to maintain themselves without recourse to public funds following their arrival in the UK.

To be granted permission under Tier 2, the licensed employer must first issue the certificate of sponsorship, with the migrant then submitting an application; if this is granted, the migrant then has the right to work for that employer in a particular role.

The interim cap will be in place from 19 July 2010 until April 2011, when a new annual cap will be introduced. The aim of the cap is to reduce the number of applications approved for Tier 1 (general) and Tier 2 (general) permission against the number of applications approved last year, thereby maintaining the levels of immigration under Tier 1 (general) and Tier 2 (general) at last year’s levels or less.

The interim cap does not apply to the remaining Tier 1 permissions (including investor, entrepreneur and post-Study Work) or the remaining Tier 2 permissions (including intra-company transfer, sportsperson and ministers of religion).

The number of migrants to whom a certificate of sponsorship can be issued under Tier 2 (general) will be limited to 18,700. The cap will affect both migrants applying to come to the UK and those already in the UK. It will also affect those who already hold a certificate of sponsorship (or work permit) to work for their current employer and require a new certificate to extend their permission.

The limit on Tier 1 (general) will be broken down to a monthly allocation and spread across the period whilst the interim cap is in force. The UK border agency has not as yet indicated how the monthly limit will be calculated or administered (for example whether the number will change each month or whether the different british diplomatic posts will be granted a different monthly allocation).

If a migrant applies for Tier 1 (general) and the monthly limit has been reached for that month, their application will then be held over for processing until the monthly allocation has not been exceeded or until the annual limit runs into force in April 2011.

In practice, highly skilled migrants who would have previously applied for Tier 1 (general) and first come to the UK to look for highly skilled roles may have to remain out of the UK when looking for available roles. These migrants may need to first apply for business visitor permission in order to attend interviews in the UK, which could then delay the recruitment process. To counter-act this, UK employers may need to conduct more of the recruitment process for highly skilled migrants over electronic communications and video conferencing and be prepared to travel if they need to meet the candidate.

If a migrant has applied for Tier 1 (general) status (because this is their preference or the UK employer has no current allocation of certificates under Tier 2 (general)) the employer will need to understand that the application could be pending for a long and uncertain period. Furthermore, the migrant will need to include their passport with the application and could potentially be grounded overseas for some time.

The low limit of Tier 1 (general) may mean that employers who are not already registered sponsors under Tier 2 (general) may now choose to submit a sponsorship application in order to take advantage of the higher limit available under Tier 2 (general). However there is a risk that they will be granted a zero allocation of certificates and must then request an exceptional allocation, and there is no guarantee that this will be approved.

If an employer retains an allocation, albeit reduced, they may continue to use that allocation while the interim cap is in place. However, if an employer needs to extend a migrant’s permission under Tier 2 (general) and they have no allocation they will need to request an additional exceptional allocation.

If this is not granted the migrant and employer will need to consider alternative immigration permissions or terminating the migrant’s employment.

Furthermore, if the allocation of certificates is reduced to a number less that the number of migrants requiring an extension, the employer may be forced to choose between those migrants, ultimaltely dismissing one in favour of another. This is a choice which could be fraught with unfair dismissal and risks of discrimination.

Employers recruiting migrants will also need to be absolutely certain before they issue a certificate that the migrant can satisfy the points criteria and that they will accept the role on offer.

Once the certificate is assigned to a particular migrant, it cannot be withdrawn and assigned to another migrant, be they an existing or prospective employee.

Ultimately, the additional complexities caused by the introduction of the interim cap could cause employers to question whether it is worth supporting a migrant through the immigration permission application process. This could then cause an employer to favour an applicant who is able to obtain their own immigration permission or does not need one. In such circumstances, employers must be aware of the risks of discriminating against an applicant on the grounds of race and nationality.