Category: Updates & Publications

EU citizens lost their automatic right to work in the UK on 1st January 2021

What documents are now required by EU citizens to confirm their right to work in the UK?  The Home Office has confirmed that employers at present have no right to demand that EU citizens apply under the EU settlement scheme and share their outcome (due to conflicts around discrimination), and confirm that a copy of an EU passport remains perfectly acceptable. However, this contradicts the Prevention of Illegal Working Regulations which confirm that any copy taken after 1 Jan 2021 would not confirm a lawful right to work (as it doesn’t confirm arrival prior to this date). In addition, any EU national in the UK after 1 July 2021 without status under the EUSS would be here illegally, even if resident before 1 January, and thus an employer would face a penalty for employing an illegal worker. We are therefore advising UK employers to gently “suggest” their workers obtain and share their status before the end of June, and have this “encouragement” become more forceful nearer the time – when we expect the guidance to be clearer. In the run up to the end of June companies may decide that they must have EUSS evidence on file, and terminate employment if this is not forthcoming. In order to employ EU citizens arriving in the UK after 1st January 2021, a business will need to apply for or have a sponsor licence. We are happy to advise on obtaining the sponsor licence! For more information and to enquire about Sponsor licence, please contact us on contact@sterling-law.co.uk 020 7822 8535

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Coronavirus (COVID-19): Worker and Student sponsors

The Home office updated the guidance on 4 January 2021 regarding the following:

If your student or employee is absent

The Home office will not take enforcement action against sponsors who continue to sponsor students or employees despite absences due to coronavirus.

You do not need to report student or employee absences related to coronavirus.

This can include absences due to illness, their need to isolate or inability to travel due to travel restrictions.

You do not need to withdraw sponsorship if because of coronavirus:

  • a student is unable to attend for more than 60 days
  • an employee is absent from work without pay for more than 4 weeks

This will be kept under review.

If you have issued a Certificate of Sponsorship (CoS) or a confirmation of acceptance for studies (CAS) and the sponsored employee or student has not yet applied for a visa

The employee or student will still be able to apply for a visa.

The start date for the course or employment stated on the CoS or CAS may have changed. We will not automatically refuse such cases.

For example, we may accept a CoS or CAS if they have become invalid because the employee or student was unable to travel as a result of coronavirus. The Home office will consider this on a case by case basis.

If you’re sponsoring employees who are working from home

You do not have to notify the home office if you’re sponsoring employees who are working from home due to coronavirus.

Other changes to their working arrangements must still be reported as usual.

If you’re sponsoring a student who’s waiting for their permission as a Student or Child Student application to be decided

You may allow students to start their studies before their visa application has been decided if:

  • you are a Student sponsor
  • you have assigned the student a CAS
  • the student submitted their application before their current visa expired and has shown you evidence of this
  • the course they start is the same as the one listed on their CAS
  • the student has a valid Academic Technology Approval Scheme(ATAS) certificate if required

Your reporting responsibilities start from the date that you issue the CAS, not from the date that their application is granted.

If the student’s application is eventually rejected as invalid or refused you must terminate the student’s studies.

 

If you require further clarification, please contact us.

Procedural unfairness in Skilled Worker (T2 General) application ? The Court of Appeal provides further clarification

Procedural unfairness in Skilled Worker (T2 General) application ? The Court of Appeal provides further clarification
 

In the recent case of Topadar v Secretary of State for the Home Department [2020] EWCA Civ 1525 the Court of Appeal examined two questions:

  1. At what point is an immigration application decided by the Home Office?
  2. Is it procedurally unfair for the Home Office to refuse an application due to the applicant’s sponsor (i.e. their employer) failing to provide additional information (without the applicant ever being made aware of the request)? 

The Court of Appeal decided:

  1. The immigration application had been decided at the point of the Home Office’s initial refusal notice. Administrative review of that decision is not an extension of the decision-making process;
  2. There is no absolute requirement that the Home Office must give an applicant prior notice of something that might affect the consideration of their application.
It is paramount that any company planning to sponsor a migrant worker (which will include EEA nationals) should be aware of the need to respond to any request for further information from the Home Office. Failure to reply, or to provide answers, could lead to the application being refused.
 
If you need further clarification or assistance with your application, please contact us.
 
Oksana Demyanchuk

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Long Residence Applications: Gaps in lawful residence

The Immigration Rules regarding long residence provide that Applicants who have resided in the UK continuously and lawfully for 10 years are entitled to apply for indefinite leave to remain.


This begs the question: what if I have a gap in my lawful residence?


The Immigration Rules state as follows:


276B. The requirements to be met by an applicant for indefinite leave to remain on the ground of long residence in the United Kingdom are that:


(i) (a) he has had at least 10 years continuous lawful residence in the United Kingdom.


[…]

(v) the applicant must not be in the UK in breach of immigration laws, except that, where paragraph 39E of these Rules applies, any current period of overstaying will be disregarded. Any previous period of overstaying between periods of leave will also be disregarded where –


(a) the previous application was made before 24 November 2016 and within 28 days of the expiry of leave; or


(b) the further application was made on or after 24 November 2016 and paragraph 39E of these Rules applied.


R (Ahmed) v Secretary of State for the Home Department [2019] EWCA Civ 1070 dealt with Applicant’s who had a period of overstaying between lawful leave during their 10 years qualifying period. The Court of Appeal held that that application of 39E, namely the application of the 14-day or 28-day grace period, did not convert these periods into lawful leave. Therefore, an application could not rely on such a period of residence for the purpose of an application for indefinite leave to remain under the long residence provisions in 276 B of the Immigration Rules.


In essence, this meant that, if an applicant had any period of overstaying at all during their 10-year qualifying period, even in circumstances where that overstaying was within that permitted by paragraph 39E, their application would fall for refusal.


The decision of the Court of Appeal appeared to contradict the Home Office’s own guidance on Long Residence, which stated:


You may grant the application if an applicant: 


  • has short gaps in lawful residence through making previous applications out of time by no more than 28 calendar days where those gaps end before 24 November 2016 

  • has short gaps in lawful residence on or after 24 November 2016 but leave was granted in accordance with paragraph 39E of the Immigration Rules 

  • meets all the other requirements for lawful residence

leading to much confusion as to the correct interpretation of paragraph 276B.


In Hoque & Ors v. SSHD [2020] EWCA Civ 1357, the Court of Appeal has provided some welcome clarification. In this case, each of the Appellants had a period of overstaying during their 10-year period where the grace period allowed for by paragraph 39E applied.


The court of Appeal held that Masum Ahmed, which was concerned with past overstaying, was wrongly decided. [40]. In reaching this conclusion, the Court of Appeal relied in part on the Secretary of State’s own guidance on the point (citing Pokhriyal v SSHD [2013] EWCA Civ 1568 as authority to rely on guidance where the rules are ambiguous).


The Court of Appeal went on to criticise the confusion state of the Rules at paragraph 59 of the Judgement:


This Court has very frequently in recent years had to deal with appeals arising out of difficulties in understanding the Immigration Rules. This is partly a result of their labyrinthine structure and idiosyncratic drafting conventions but sometimes it is a simple matter of the confusing language and/or structure of particular provisions. This case is a particularly egregious example. The difficulty of deciding what the effect of paragraph 276B (v) is intended to be is illustrated by the facts not only that this Court itself is not unanimous but that all three members have taken a different view from that reached by a different constitution in Masum Ahmed. Likewise, the Secretary of State initially sought to uphold Masum Ahmed – contrary, it would seem to her own Guidance – but, as we have seen, shortly before the hearing executed a volte-face. (This illustrates a different vice, also far from unique, that the Home Office seems to have no reliable mechanism for reaching a considered and consistent position on what its own Rules mean.) Of course, mistakes will occasionally occur in any complex piece of legislation or quasi-legislation; but I have to say that problems of this kind occur too often. The result of poor drafting is confusion and uncertainty both for those who are subject to the Rules and those who have to apply them and consequently also a proliferation of appeals. The Secretary of State has already taken a valuable first step towards improving matters by asking the Law Commission to report on the simplification of the Immigration Rules, and I hope that action will be taken on those recommendations. But the problem goes further than matters of structure and presentation, and I would hope that thought is also being given to how to improve the general quality of the drafting of the Rules.


Oksana Demyanchuk

+44 020 7822 8535

oksana@sterling-law.co.uk

Michael Carter

+44 020 7822 8535

michael@sterling-law.co.uk

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GDPR update: personal data transfer

Recently there was a decision in the Court of Justice of the European Union in Case C-311/18 – Data Protection Commissioner v Facebook Ireland Ltd and Maximillian Schrems.

 

The CJEU has confirmed how EU standards of data protection must travel with the data when it goes overseas, which means this judgment has wider implications than just the invalidation of the EU-US Privacy Shield. It is a judgment that confirms the importance of safeguards for personal data transferred out of the UK.

 

First of all, I would like to explain what did the Court rule in its judgement. In the case of Data protection commissioner v Facebook Ireland Ltd and Maximilian Schrems, the Court examined the validity of the European Commission’s Decision 2010/87/EC on Standard Contractual Clauses (“SCCs”) and considered that it is valid.

 

However, that validity, the Court added, depends on whether the 2010/87/EC Decision includes effective mechanisms that make it possible, in practice, to ensure compliance with the level of protection essentially equivalent to that guaranteed within the EU by the GDPR and that transfers of personal data pursuant to such clauses are suspended or prohibited in the event of the breach of such clauses or it being impossible to honour them.

 

As a conclusion, the Court stated, that the 2010/87/EC Decision imposes an obligation on a data exporter and the recipient of the data (the “data importer”) to verify, prior to any transfer, and taking into account the circumstances of the transfer, whether that level of protection is respected in the third country concerned, and that the 2010/87/EC Decision requires the data importer to inform the data exporter of any inability to comply with the standard data protection clauses, and where necessary with any supplementary measures to those offered by that clause, the data exporter then being, in turn, obliged to suspend the transfer of data and/or to terminate the contract with the data importer.

 

The Court also examined the validity of the Privacy Shield Decision, as the transfers at stake in the context of the national dispute leading to the request for preliminary ruling took place between the EU and the United States (“U.S.”). The Court considered that the requirements of U.S. domestic law, and in particular certain programmes enabling access by U.S. public authorities to personal data transferred from the EU to the U.S. for national security purposes, result in limitations on the protection of personal data which are not circumscribed in a way that satisfies requirements that are essentially equivalent to those required under EU law, and that this legislation does not grant data subjects actionable rights before the courts against the U.S. authorities. Because of such a degree of interference with the fundamental rights of persons whose data are transferred to that third country, the Court declared the Privacy Shield adequacy Decision is invalid.

 

What does this mean for you?

 

If you are or were transferring data internationally, you are no longer able to rely on the Privacy Shield rule, and in order to transfer data to the US would need to check whether you can do so under the conditions laid down below.

 

Please note that further work is underway by the European Commission and EDPB to provide more comprehensive guidance on extra measures you may need to take. In the meantime, you should take stock of the international transfers you make and react promptly as guidance and advice become available. 

 

The EDPB has recommended that you must conduct a risk assessment as to whether SCCs provide enough protection within the local legal framework, whether the transfer is to the US or elsewhere. The receiver of the data may be able to assist you with this.

 

We could assist you and review your privacy policy to ensure compliance with recent legal changes and your international data transfer. If we will conclude that your Privacy Policy is not compliant, we will have to amend it accordingly and to further consider the use of controller-to-processor standard contractual clauses.

Michael Iatsukha

michael@sterlinglawyers.co.uk

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US Citizenship Renunciation And Its Tax Consequences

US Citizenship Renunciation And Its Tax Consequences: US citizenship has been always considered as a privilege. The country created by immigrants always had one of the best opportunities for entrepreneurs around the world and was one of the most desirable destinations. But despite that, in the modern world of tight fiscal policies and tax transparency, an increasing amount of US citizens are deciding to relinquish their citizenship because of tax reasons.

Despite the highest citizen renunciation fee in the world, at $2,350, and possible tax consequences, every year around 7,000 US citizens decide to renounce their citizenship. This amount has been steadily increasing every year since 2010 when the Foreign Account Tax Compliance Act (FATCA) became law.

Under US law, all US citizens and legal permanent residents (green card holders) are subject to US federal income tax regardless of their location, residence, place of living and source of income. US legislation defines these people as US persons. All US persons have to file an annual US tax declaration even if they permanently live and have income in another country and do not receive any income from the US sources. Apart from the US, Eritrea is the only country in the world which imposes the same exterritorial tax liability for its citizens.

Most US persons who live and pay tax outside the US use a foreign tax credit. This means they pay usual tax in the country of their current residence and, in cases where the US tax rate for this income is higher, they have to pay the exceeded amount of the tax to the US government. In other words, they always have to pay tax at least at US federal rates. In the case where their current country of residence has higher tax than the US, they forfeit that amount of overpaid tax. However, the credit can be carried forward. Also, it is important that foreign tax credit cannot be used at all with the tax paid in certain sanctioned countries detailed in section 901(J) of US Internal Revenue Code and currently including Iran, North Korea, Sudan, Syria and, with some exceptions, Libya.

The Special US Expatriate Income Tax Regime

The special tax regime arises on a non-resident basis when an individual expatriates from the United States by surrendering their US citizenship or terminating US permanent resident status. When this is done for tax avoidance purposes, the special expatriate tax regime will also apply.

In order to be a US permanent resident for US expatriate tax purposes, a foreign individual should be a lawful US permanent resident (a US person) and hold that status (a green card) for 8 of the last 15 tax years.

The special tax regime, however, is not applicable to a foreign national who was a US tax resident under the substantial presence test (the 183-day test). The US residence end date for such nationals is determined by the normal tax residence rules. This is applicable to foreign students or overseas workers, who spend several years in the US as US student or work visa holders and who leave the country without obtaining a green card.

There are two exceptions in the current US legislation, allowing US citizens to be beyond the scope of the special regime:

1. When an individual becomes a US citizen and citizen of another country at birth and still has citizenship of another country, is currently tax resident in such a country, and has been a US resident for not more than 10 taxable years during the previous 15-taxable year period, or

2. When a US citizen relinquishes US citizenship before attaining the age of 18.5 and has been a US resident for not more than 10 taxable years prior to the relinquishment date.

Tax Avoidance Test

In order to determine the applicability of the special expatriate tax regime, US legislation has a special tax avoidance test. The test has three conditions and, if any on them is met, expatriation is deemed to have been conducted in order to avoid US tax and that individual is called ‘covered expatriate’.

The first condition is met when the net worth of an individual at the date of expatriation or termination of residency is equal or more than USD2m.

The second condition is met when the average US federal income tax liability for the last five tax years preceding the tax year of expatriation or residency termination is equal or more than USD165,000, for individuals expatriating in 2018. This means that in 2018, the average will be calculated for 2017-2013 tax years. The threshold is subject to increase each year according to the inflation and published annually.

The last condition is when an individual fails to certify full compliance with all US federal tax obligations for the five years preceding the date of expatriation or termination of residency. This last condition means that if an individual failed to disclose any non-US income or bank account to the US tax authority, mistakenly or deliberately, this automatically makes him ‘covered expatriate’. Additional sanctions are also applicable for such non-compliance.

The expatriate tax is imposed on ‘covered expatriates’ in a mark-to-market way in the following manner: if all the assets and property of the individual are sold at their fair market value one day before the day he surrenders its citizenship or terminates his permanent resident status, the relevant gain or loss is subject to US federal income tax on a non-resident basis. This gain constitutes the taxable amount and is taxed at a 30 per cent rate.

In cases when a US resident-owned any property before the date of becoming a US resident, such property cannot be valued at less than its fair market value on the date of becoming a US resident.

The taxable gain can be reduced by a tax-free allowance in the amount of USD699,000 for 2017 and USD711,000 for the 2018 tax year. This allowance is subject to change every year, according to the inflation rates.

It is important to note that US citizens and residents who receive any gifts or bequests from US expatriates or who meet the tax avoidance test are subject to tax on the value of such gifts or bequests at the higher estate or gift tax rate on the date that they were received. Some gifts and bequests are exempt from tax such as gifts to governmental organizations and charities. Gifts between US and non-US spouses also have annual tax exclusion of USD152,000 for 2018. Also, there is no tax on a gift if the value of a gift is within the US annual tax gift exclusion. The annual tax gift exclusion for 2018 is USD15,000.

Reed Amendment

The Reed Amendment was added to the US Immigration and Nationality Act in 1996 in order to deny re-entry to the US of former citizens who have officially renounced their citizenship and who are determined by the Attorney General to have renounced their citizenship for the purpose of avoiding taxation. The author of the amendment was Jack Reed, the Democratic Party senator from Rhode Island.

The amendment was mainly targeted at wealthy Americans who wanted to expatriate from the US, stop being US taxpayers, and then to visit the US occasionally at their leisure without paying any taxes. The burden of proving tax avoidance lies on the US government and is not connected at all with the IRS tax avoidance test described above.

If the Department of Homeland Security determines that renunciation is motivated by tax avoidance purposes, the individual will be found inadmissible to the United States under the Immigration and Nationality Act. The US government hasn’t issued any regulations on how this law should be implemented in practice. According to the Department of Homeland Security, this law has been used only twice since its enactment in 2002 and 2015, and only two former US citizens have been denied entry the US. Moreover, the latter case was overturned when a former US citizen’s lawyer submitted a legal brief to the US Customs and Border Protection.

Contact Igor if you have questions about US Citizenship Renunciation And Its Tax Consequences.

Igor Persidskiy

Associate

igor@sterling-law.co.uk

+44 20 7822 8535

Travelling during COVID-19: Travel corridors

COVID-19 brought a lot of uncertainties to travellers. The change of policy on travel from France and the Netherlands shows that decision on travel restrictions can virtually be made overnight.

In this article, we will explain which travel corridors are currently open and how you can avoid complications while travelling.

What is a travel corridor?

A travel corridor (often referred to as an air bridge) is a reciprocal arrangement between two countries allowing travel without the need to quarantine for 14 days. Those travel corridors are under a constant review by the government and might exclude any country that has seen a rise of coronavirus cases.

The countries currently included in the travel corridor exemption, as listed on the Government website of 14 August 2020, are as follows:

 

  • Akrotiri and Dhekelia
  • Anguilla
  • Antigua and Barbuda
  • Australia
  • Austria
  • Barbados
  • Bermuda
  • Bonaire, St Eustatius and Saba
  • British Antarctic Territory
  • British Indian Ocean Territory
  • Brunei (added 11 August – if you arrived in England from Brunei before 11 August, you will need to self–isolate)
  • Cayman Islands
  • the Channel Islands
  • Croatia
  • Curaçao
  • Cyprus
  • Czech Republic
  • Denmark
  • Dominica
  • Estonia
  • Falkland Islands
  • Faroe Islands
  • Fiji
  • Finland
  • French Polynesia
  • Gibraltar
  • Germany
  • Greece
  • Greenland
  • Grenada
  • Guadeloupe
  • Hong Kong
  • Hungary
  • Iceland
  • Ireland
  • the Isle of Man
  • Italy
  • Jamaica
  • Japan
  • Latvia
  • Liechtenstein
  • Lithuania
  • Macao (Macau)
  • Malaysia (added 11 August – if you arrived in England from Malaysia before 11 August, you will need to self–isolate)
  • Mauritius
  • Montserrat
  • New Caledonia
  • New Zealand
  • Norway
  • Pitcairn, Henderson, Ducie and Oeno Islands
  • Poland
  • Reunion
  • San Marino
  • Seychelles
  • Slovakia
  • Slovenia
  • South Korea
  • South Georgia and the South Sandwich Islands
  • St Barthélemy
  • St Helena, Ascension and Tristan da Cunha
  • St Kitts and Nevis
  • St Lucia
  • St Pierre and Miquelon
  • St Vincent and the Grenadines
  • Switzerland
  • Taiwan
  • Trinidad and Tobago
  • Turkey
  • Vatican City State
  • Vietnam

 

 

What if My Time was Split between Countries on the list and not on the list?

If you spent time in a country which is not on the list and go to a country on the list it will depend on the number of days you spent in those countries. For example, if you spent 7 days in a country not on the list and 7 days in a country on the list, you will have to self-isolate in England for 7 days because 7 out of 14 days you spent in an exempt country.

What is Meant by Self-isolation?

Self-isolation effectively means that you cannot leave the place where you are staying in the UK for the first two weeks after arrival. You should (as taken from the Government website):

“not have visitors, including friends and family, unless they are providing essential care. The only friends and family who you can have contact with are those who travelled with you or people who you are staying with.

You cannot go out to work or school or visit public areas. You should not go shopping. If you require help buying groceries, other shopping, or picking up medication, you should ask friends or relatives or order a delivery.

In England, you must only exercise within your home or garden. You cannot leave your home to walk your dog. You will need to ask friends or relatives to help you with this.

NHS Volunteer Responders are also available if you need help collecting shopping, medication, or would like a telephone ‘check-in and chat’. Call 0808 196 3646 (8 am to 8 pm) to arrange volunteer support. You can arrange one-off support, or schedule more regular help whilst you are self-isolating.

In England, you can only leave your accommodation in limited circumstances. These include where:

  • you need urgent medical assistance (or where your doctor has advised you to get medical assistance)
  • you need access to basic necessities like food and medicines, but only in exceptional circumstances such as where you cannot arrange for these to be delivered
  • you need to access critical public services such as social services and victim support services, but only in exceptional circumstances
  • you need to go to the funeral of a family member or someone you live with
  • you need to visit a dying or critically ill family member or someone you live with
  • you need to fulfil a legal obligation such as participate in legal proceedings
  • there’s an emergency

You are not allowed to change the place where you are self-isolating except in very limited circumstances, including where:

  • a legal obligation requires you to change address, such as where you are a child whose parents live separately, and you need to move between homes as part of a shared custody agreement
  • it is necessary for you to stay overnight at the accommodation before travelling to the place where you will be self-isolating for the remainder of the 14 days
  • there’s an emergency

If this happens, you should provide full details of each address where you will self-isolate on the public health passenger locator form. If in exceptional circumstances, you cannot remain where you are staying, you must update the form as soon as possible”.

Final words

The travel corridors change on a daily basis. We recommend you to frequently check the governmental website if you are planning to go on holidays in order to avoid unnecessary complications.

 

Employing EU citizens after Brexit

Recently, the Home Office started to refuse more and more applications for EU settlement scheme. As of June 2020, there were 3.71 million applications. In May 2020 Home Office made 900 refusals and in June 2020 it refused 1,400 applications.

A lot of UK employers have a significant number of EU employees as a part of their workforce. If employees lose their permission to work in the UK, employers might bear a lot of costs. If your employees apply as early as possible it will give them a chance to resubmit the application if it is refused. If, however, the employees wait until the deadline of 30 June 2021 they might lose permission to work in the UK and might not be able to re-apply. The process is also taking longer at the moment because of the COVID-19.

If an employee does not have valid permission to work in the UK past the deadline, it might lead to their dismissal. This will not only have a negative effect on the employee but also the employer can lose a valuable part of the workforce.

In order to avoid any complications with your application, you can consult one of our experienced lawyers for the EU settlement scheme application.

Contact us: contact@sterling-law.co.uk or 07 305 966 531

 

Covid & Visa sponsorship: Tier 2, Tier 4, Tier 5

The Home office has updated their guidance for Tier 2, 4 and 5 visa sponsors in the UK who are sponsoring those affected by coronavirus (COVID-19).

If your student or employee is absent

No enforcement action will be taken against sponsors who continue to sponsor students or employees despite absences due to coronavirus.

Sponsors do not need to report student or employee absences related to coronavirus.

This can include absences due to illness, their need to isolate or inability to travel due to travel restrictions.

Sponsors do not need to withdraw sponsorship if because of coronavirus:

  • a student is unable to attend for more than 60 days
  • an employee is absent from work without pay for more than 4 weeks

The above will be kept under review.

If you have issued a Certificate of Sponsorship (CoS) or a confirmation of acceptance for studies (CAS) and the sponsored employee or student has not yet applied for a visa

The employee or student will still be able to apply for a visa.

The start date for the course or employment stated on the CoS or CAS may have changed. We will not automatically refuse such cases.

For example, we may accept a CoS or CAS if they have become invalid because the employee or student was unable to travel as a result of coronavirus. We will consider this on a case by case basis.

If you’re sponsoring a student who’s waiting for their Tier 4 visa application to be decided

You may allow students to start their studies before their visa application has been decided if:

  • you are a Tier 4 sponsor (other than Tier 4 Legacy Sponsors)
  • you have assigned the student a CAS
  • the student submitted their application before their current visa expired and has shown you evidence of this
  • the course they start is the same as the one listed on their CAS
  • the student has a valid Academic Technology Approval Scheme (ATAS) certificate if required

Your reporting responsibilities start from the date that you issue the CAS, not from the date that their application is granted.

If the student’s application is eventually rejected as invalid or refused you must terminate the student’s studies.

If you’re sponsoring employees who are working from home

You do not have to notify us if you’re sponsoring employees who are working from home due to coronavirus.

Other changes to their working arrangements must still be reported as usual.

If you’re sponsoring an employee who’s waiting for their Tier 2 or 5 visa application to be decided

You may allow employees to start work before their visa application has been decided if:

  • you have assigned them a CoS
  • the employee submitted their application before their current visa expired
  • the role they are employed in is the same as the one on their CoS

Your reporting responsibilities for an employee start from the date you have assigned them a CoS, not from the date that their application is granted. You will not be able to report information to us using the sponsor management system. You must however ensure that you record and maintain all the relevant information set out in the sponsor guidance on your own systems. Any changes that will impact the eventual consideration of the migrant’s visa application should be updated on the CoS, as normal.

If the employee’s application is eventually rejected as invalid or refused you must terminate their employment.

If you cannot pay the salaries of sponsored employees because you’ve temporarily reduced or ceased trading

You can temporarily reduce the pay of your sponsored employees to 80% of their salary or £2,500 per month, whichever is the lower.

Any reductions must be part of a company-wide policy to avoid redundancies and in which all workers are treated the same.

These reductions must be temporary, and the employee’s pay must return to at least previous levels once these arrangements have ended.

 

Contact Oksana Demyanchuk for further information:

oksana@sterling-law.co.uk

+44 020 7822 8535

Litigation funding

As a consequence of the Covid-19 crisis, we expect a rise in disputes regarding supply and service contacts. However, due to the limited cash flow, a lot of firms will not be able to afford the litigation. The solution to this can be litigation funding.

The recent case of ChapelGate Credit Opportunity Master Fund Limited v Money and others showed that fewer professional funders are prepared to fund the full dispute.

Previously, professional funding could assist smaller businesses with distinct but often expensive immediate costs, such as expert witnesses.

However, in recent years, we have seen the emergence of tech start-ups in the litigation funding industry. These start-ups use special algorithms to evaluate risks.

What should I take into account when considering professional litigation funding?

1. Tailored solution

Many professional funders will offer funding solutions based on their own set of rigid criteria, often driven by lawyers they instruct to protect them. As every dispute is different, you need to carefully consider all the options of funding available to you.

2. Self-regulation

As litigation funding is not regulated by a governmental body, there is little protection for small businesses. Therefore, you should ensure that the contract is correctly written and affords you sufficient protection.

3. Legal advice

Legal professionals are obliged to advise and act in the best interests of their client. This includes making them aware of alternative ways of financing their dispute. A law firm cannot promote one funder over another but can detail the options available for the client to decide which may be suitable for your business.

Why you need flexible and creative litigation lawyers

You should ensure that the litigation lawyers are open to new creative solutions and take a flexible approach in order to succeed in your litigation case and funding.

Contact us for a solution:

020 7822 8535

contact@sterling-law.co.uk