Catherine Barnard and Sarah Fraser Butlin*
*The authors are both at the University of Cambridge and funded by the ESRC’s UK in a Changing Europe program. They thank their colleagues, Graeme Ross, Steve Peers, Jonathan Portes and Madelaine Sumption.
Introduction
A primary reason many voted to exit the European Union on June 23, 2016, was concern over immigration. Many felt the UK had “lost control” of its borders and that leaving the EU would allow the UK government to regain control. While passport checks were and still are in place at UK borders, the public perceived an unmanageable influx of immigrants. It is true that migration was at an all-time high during the referendum. Many viewed Brexit as a way to address this issue.
Finding a solution that encourages skilled workers to come to the UK while appearing to “take back control” is a more complicated issue. In her Mansion House speech on March 2, 2018, Theresa May addressed migration, stating:
[W]e must maintain the links between our people. … We are clear that as we leave the EU, free movement of people will come to an end and we will control the number of people who come to live in our country. But UK citizens will still want to work and study in EU countries - just as EU citizens will want to do the same here, helping to shape and drive growth, innovation and enterprise. Indeed, businesses across the EU and the UK must be able to attract and employ the people they need. And we are open to discussing how to facilitate these valuable links.
However, there was no explanation of how this would be accomplished. In an interview with the Observer, Michael Heseltine stated, “Why is it that after 18 months since the referendum we have not got any closer with these issues? The answer is simple: because no one has got any answer about how to do it.”
Amber Rudd, the then-Home Secretary, commissioned the Migration Advisory Committee to investigate the country’s needs, with a final report due in the Autumn. The immigration white paper, which was due last year, has yet to be released. Meanwhile, the Windrush scandal has brought to light the impact of the Home Office’s ‘hostile environment’ on British citizens.
Given the current climate surrounding migration, the UK appears unable to decide whether it will maintain its two-tiered immigration system (a preferential regime for EEA nationals and a (significantly) less favorable regime for the rest of the world) or adopt a single system for all immigrants.
There have been suggestions that the two-tier model, with preferential access for EEA nationals, is preferred. If such access were as similar as possible to the current model of free movement, it would undoubtedly aid in the negotiation of a future agreement and leave the door open for UK participation in several programs, including those for EU research funding. While speaking in Denmark on April 9, 2018, Prime Minister Theresa May stated that while she would maintain the target of reducing net annual migration to below 100,000, she recognized that ‘UK citizens will still want to come and study and work in countries in the EU27 like Denmark, and EU citizens like Danish citizens will still want to come and work and study in the UK.’ On April 29, 2018, the Independent reported that ‘Britain [is] set to offer EU Brexit immigration deal “very similar” to free movement.’
However, there is a new home secretary, Sajid Javid, who is rumored to have scrapped a proposed policy that would have given EU nationals preferential treatment, and has also removed Non-EEA health service workers from the Tier 2 cap. This could imply that he is considering a single policy for EEA and non-EEA nationals in the future. This might not be politically viable. The current visa system for non-EEA nationals is bureaucratic, costly, and subject to the 20,700-migrant cap (within Tier 2). Businesses in certain sectors rely on (EEA) migrant workers. Without a complete overhaul of the visa system, many businesses will be unable to find the employees they require.
Migrant-sending countries, such as Poland, Bulgaria, and Romania, may want their citizens to be able to work in the UK. As a result, in the context of the UK’s future relationship with the EU, there may be some interest in the EU exploring a new migration agreement with the UK. The UK, in turn, may eventually allow pragmatism to prevail, at least during a transitional period until UK workers are trained, and may be willing to consider a preferential but controlled regime for EEA nationals. This system could be based on the concept of “fair movement” or “fair mobility” rather than free movement (after all, the UK is leaving the EU and, unless it remains in the EEA, will no longer have free movement). The plan we propose, which will be presented in three blogs published this week, is based on a historical understanding of the EU’s free movement provisions to inform our recommendations for how this new scheme might look. Our proposal is pragmatic, attempting to strike a balance between the EU’s interests, which will inevitably lean toward free movement, and the UK government’s, which will lean toward greater restrictions.
The first blog argues that when the original EU Treaty (the Treaty of Rome) was drafted, it focused on the right of individuals to move freely for work, rather than broader concepts of citizenship and state-building. We believe that the UK’s new agreement with the EU could revive these original concepts. Domestically, the current system for Croatians working in the UK could serve as a model for how this could be implemented.
The second blog examines how the equality principle might work in a post-Brexit immigration policy, particularly in terms of access to benefits. We argue that equal treatment should be phased in based on the migrant’s length of residence, with preconditions for access and specific exclusions, particularly in the early stages of a migrant’s arrival.
The third blog examines the final component of a fair movement policy: the implementation of an emergency brake.
We will now look at the first component of our fair movement proposal: linking movement to economic activity.
Back to the Future
The concept of free movement of people was centered on the economically active, namely workers and those seeking employment, in the discussions leading up to the Treaty of Rome. The 1948 Paris Treaty, which established the Organisation for European Economic Cooperation (OEEC), included the idea of free movement of people, which required Contracting Parties to ’take the necessary measures to facilitate the movement of workers.’ However, this was secondary to the goal of ensuring ‘full employment for their own people’ (emphasis added).
Throughout the formal discussions about the establishment of the EU’s Common Market, the emphasis was on worker mobility. The German, Belgian, Italian, Luxembourg, and Dutch delegations proposed that the Treaty’s provisions on the free movement of people should “consist of the free access of nationals of the Member States to economic activities in the territory of the Community” (emphasis added). In November 1955, the Inter-Governmental Conference determined that the concept of free movement of workers included the right to “present oneself in any country of the Community for jobs actually offered and to remain in that country without any other administrative restriction if a job is actually obtained” (emphasis added) (Original text: “une interprétation correcte de la notion de libre circulation des travailleurs: elle comporte le droit de se présenter dans tout pays de la Communauté aux emplois effectivement offerts et de demeurer dans ce pays sans aucune autre restriction administrative si un emploi est effectivement obtenu”.)
This interpretation of the free movement of people was reiterated in the 1956 Spaak report and served as the foundation for the initial drafting of the Treaty of Rome. Subsequent discussions suggested that the right to free movement should apply to both job seekers and workers.
What is clear is that the initial Treaty drafters were solely concerned with the economically active. It was not until much later, with the adoption of the Residence Rights Directives in the early 1990s, that the semi-economically active (students, retirees, and persons of independent means (PIMs)) were granted free movement rights. These directives have since been replaced by provisions in the Citizens’ Rights Directive 2004/38 (CRD), which require EU citizens in this group to have comprehensive health insurance and sufficient resources to stay in another Member State for more than three months. The Treaty of Maastricht (1992) only considered free movement rights for the economically inactive through its citizenship provisions. These were later fleshed out by the Court of Justice but then restricted.
We believe that the connection between economic activity and free movement is critical. We believe that for countries like the UK that want a close economic relationship with the EU, the right to move should be refocused on economic factors, as envisioned by the treaty’s original drafters. Those who want to stay in the UK for more than three months should be coming for work. This, in and of itself, would have no effect on numbers: the majority of EEA citizens come to work, and this group has very high employment rates.
We propose that EEA migrants be required to have secured work that is not only genuine and effective but also significantly more than de minimis (e.g., a minimum of 20 hours per week referenced over a period of, say, 4 months) to reside in the UK for more than three months. Furthermore, regardless of whether the individual is employed or self-employed, this work must be either highly skilled or paid above a certain minimum wage. According to a recent leaked document, the government may support this idea. EU workers would have to earn £20,500 to come to the UK (significantly more than a full-time minimum wage, or £1,254.60 per month for someone on a 2040-hour annual contract). This would result in a significant decrease in numbers. In addition, we recommend that an individual work for at least three months before bringing their family members with them (parents, spouse, dependent children).
We have demonstrated that linking movement to economic activity is rooted in EU law’s origins. EU law already mandates that work be genuine and effective, rather than merely marginal and ancillary. However, skill and/or pay threshold requirements go far beyond EU law, and the EU may find them difficult to accept in future negotiations unless they are only implemented for a limited time.
Students, retirees, and people of independent means all contribute significantly to the UK economy. We advocate for their inclusion in the definition of those who would have the right to free movement, provided they have sufficient resources, with those minimums defined (unlike the CRD), and comprehensive health insurance (this could be through the NHS surcharge or private health insurance). In other words, we would advocate for the continued application and full enforcement of the residency requirements outlined in Article 7 of the Citizens’ Rights Directive (CRD) to this group. This group would be allowed to work, but only for up to 20 hours per week.
Finally, there is the matter of those who want to come to the UK to receive or provide services. This is referred to as Mode 2 (consumption abroad, such as tourism) and Mode 4 services in the WTO (natural persons supplying services in another country). To facilitate these arrangements, EEA nationals should be able to enter the UK as tourists and look for work for 90 days. Short-term service providers would need to register in a database to indicate the nature and duration of their work. Their employment terms and conditions would be primarily governed by their home country’s laws.
Recent examples linking economic activity with free movement
The requirement for a link between free movement and (high-skilled) economic activity underpins the current scheme in place for Croatian nationals during the seven-year transition period following Croatia’s accession to the EU in July 2013. The Croatian scheme distinguishes between different types of Croatian migrants who are issued with different types of registration certificates:
A purple registration certificate to work in the UK: requires the individual to meet the requirements for skilled economic migrants, as defined by Tiers 2 and 5 of the Points-Based System (PBS), to have a job offer, and to have either a sponsorship number from the employer or, in certain cases, a letter from the employer. Unless they fall into one of the limited exceptions, they can only work with this prior work authorization. After 12 months of authorized work, no further work authorization is required.
A blue registration certificate: awarded to individuals with a UK degree who are “highly skilled individuals” or who have a Tier 1 (Exceptional Talent) Endorsement (for those who are or have the potential to be “world leaders”). There is no requirement for work authorization.
A yellow registration certificate: for students and self-sufficient individuals (i.e., PIMs). They must demonstrate that they have sufficient funds to support themselves and comprehensive health insurance. Students may be permitted to work in certain situations.
After 12 months of authorized work, a Croatian national is eligible for social security benefits and can stay in the UK as a job seeker under the same conditions as other EEA nationals. Furthermore, while working legally, they are eligible for means-tested benefits. Those who are self-employed or have a blue certificate are eligible for social security benefits right away.
Similarly, Romanian and Bulgarian workers had to have one of the following documents to work in the UK until January 1, 2014:
A Seasonal Agricultural Workers Scheme certificate; or
A “highly skilled person” registration certificate. To be eligible for this, the individual had to show proof of qualifications, age, prior earnings, and UK experience to earn enough points to meet the Immigration Rules’ threshold. Alternatively, it could be awarded to those who had earned certain qualifications from a UK institution. The registration certificate granted the bearer unrestricted access to the labor market.
An accession worker card for certain occupations such as au pairs, ministers of religion, teachers, language assistants, and midwives. Students and self-sufficient individuals could also obtain a registration certificate, which allowed students to work up to 20 hours per week during term time.
The mechanics of a registration scheme
The Bulgarian/Romanian and, later, Croatian schemes are based on the idea that an individual should be engaged in some form of economic activity, usually high-skilled, to be allowed to remain in the UK. We believe that these schemes could be expanded to include a salary threshold in place of the skills requirement outlined in Section II.
The Croatian, Bulgarian, and Romanian schemes also show how to combine a system that requires migrants to engage in economic activity with a relatively simple and inexpensive registration system. We contend that the registration systems used for Croatian, Bulgarian, and Romanian migrants could serve as a model for future agreements.
We envision employers issuing an electronic document to an individual with a qualifying job offer, confirming that the job offer is genuine and effective, as well as the salary and, if applicable, highly skilled person status. The prospective employee could then apply for a residency permit online for a small fee (around £65, the current cost of Croatian registration certificates).
If the employment ended within the first twelve months, a simple online notification system could be used to notify the Home Office, automatically giving the individual another three months (say) to find new work. The notification process should be straightforward if an individual wants to switch employers, allowing the new employer to update the relevant information. Permanent residency status would be granted after twelve months, and the online system would be updated to allow future employers to verify an individual’s status.
Adapting the Croatian model for EEA nationals (and, in the future, high-skilled non-EEA nationals?) has four advantages. First, it is a ready-made model that does not necessitate the development of new IT systems; rather, it necessitates the upgrading of existing ones (though significant investment would be required – there are currently numerous online reports of long administrative delays for Croatians applying for these certificates). Second, the number of people arriving for work will be closely monitored. This transparency and knowledge are required for control. Third, the system is still light touch. It avoids the use of complicated, bureaucratic, and costly visa systems. It might be combined with a legal presumption that the individual is permitted to work once they have a registration certificate. Fourth, it empowers employers to decide who they want to hire and in what field. The program does not rely on the Home Office to grant work permits on a monthly basis.
Conclusions
No employer wants to deal with the high costs and bureaucracy of a Tier 1 or Tier 2 visa program. We recognize that a registration system will be required for newly arrived EU migrants seeking work in the UK (as opposed to those already in the UK at the end of the transition period who have settled status). We propose a light-touch system that allows for registration without discouraging people from relocating to the UK. Our proposal, which requires the individual to demonstrate economic activity (or at least sufficient means of support), reflects the principles underlying the original Treaty, namely that migration should be for economic purposes. The first pillar of our fair movement strategy is to combine this as a foundation for future policy with a simple registration system.
Barnard & Peers: chapter 27, chapter 13
Photo credit: BBC