Recruitment Agency guide to placing expats

Especially with Brexit shrinking the ‘Local population’ from the 500m of the EU28 (including the UK) to the 70m of the UK, agencies are increasingly asking for solutions that will allow their clients to get the best talent in the world, rather than the best talent in an over-fished local pool.  The time from now until the end of EU Free Movement is an opportunity to ‘fix the roof while the sun shines’.

The most common visa for professional expats is the UK Tier 2 work visa.  This visa requires sponsorship by an employer. It is ideal for your permanent placements where your client has a Tier 2 Sponsor Licence.  If your client does not have a Tier 2 Sponsor Licence, don’t worry, we can provide immigration professionals that will help them get a licence.  Particularly if EU27 nationals end up needing sponsorship like the ‘rest of the world’, such a licence will probably be needed by them sooner or later anyway. 

Tier 2 visas must be sponsored by the ‘ultimate employer’ of the individual.  As an agency you are not allowed to sponsor Tier 2 visas for contractors or for ‘agency workers’.  You can sponsor Tier 2 visas for your own ‘internal’ staff, but not for those that will work for your clients.

Consultancies and Service providers like IBM, Tata Consultancy Services, Wipro, etc are able to sponsor Tier 2 visas for professionals that work on client sites / client projects.  BUT this is allowed only as long as the staff are directed & managed by the Supplier (IBM etc). If the individual will have their duties set by the client, then only the client is allowed to be the sponsor of their visa.  It is a bit like IR35: if an engagement would be ‘caught by IR35’, then direct sponsorship by the client is needed. 

This has lead to many large recruiters thinking that they may as well steer clear of any expats needing sponsorship.  Unfortunately, while that might have been just about viable in the days of an EU28 ‘local population’ of 500m, it is hard to sustain the ‘Locals only’ approach when the local population shrinks to 70m.  But don’t worry, there may be a solution where an engagement is ‘outside IR35’.  (the reference to ‘inside IR35’ is used as a shorthand for de-facto client employment, although the visa issues for expats are not exactly the same as the tax/NI issues for UK contractors).

We work with consultancies that fully employ, pay under PAYE, and manage, their consulting staff, and can deploy them to meet the needs of your clients.  You can continue to make the margins you would from a contract placement, by brokering a deal between your client and a service provider. While the consultancy has to do much more work than the ‘put on site and forget’ that is theoretically possible when assigning a British freelancer, from your point of view, as an agency putting a deal together and then making a margin on the contract value, there need not be much difference just because the contract concerned is one for providing a managed solution rather than simply providing a contractor.

Having said this, sponsored expats are usually appropriate only for highly skilled engagements commanding high billing rates (£40-50+/hr).  And, you as an agent, will not be able to use your usual processes & contracts. If this seems like extra hassle, then you are right, it is, and it is meant to be.  The objective of visa policy here is that, where there is a suitable local person, you should use them. By making everyone jump through hoops to use an expat, the government gives you an incentive to only resort to expats as a last resource.  Sorry, but that is the territory. BUT if your client really has a high level need, for which there is no suitable local option, then, as long as the hoops are jumped through, expat skills are an option.

We have Five main resources for Recruitment Agents: