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Immigration will be a board-level issue for UK
businesses in 2026. An expanded illegal working regime will most
likely affect every UK business, as will new rules on earned
settlement. There will also be further tightening across key
immigration routes, including sponsored work routes and business
visitors. On top of that, the Home Office plans further enforcement
measures for sponsors.
Major changes are also anticipated in employment law, some of
which will interact with immigration developments. For details of
these, see: What’s happening in employment in
2026?
Businesses that take a strategic approach to proactively
assessing and mitigating immigration and employment exposures will
be best positioned for the year ahead.
Short on time? Here are the key takeaways for businesses
You should assess how the expanded illegal working regime will
apply to you and get ready for its implementation in 2026. This is
likely to require a review of your contracts and policies relating
to how you engage workers, and investment in additional compliance
resources.
You should review how your business may be affected by the
government’s earned settlement proposals. This will require you
to understand which of your staff are currently in the UK on a
settlement route (whether sponsored or non-sponsored) and to
consider how to engage with them on their future eligibility for
settlement. You should also consider how the changes may affect
your recruitment and retention strategy for overseas talent.
You should take care to adequately assess the activities and
broader eligibility of any business visitors you intend to invite
to the UK, including taking immigration advice to check
compliance.
If you are a sponsor licence holder, you should:
Review your internal HR systems and processes to ensure sponsor
compliance risks (including illegal working risks) are proactively
identified and addressed; and
Understand how your business may be affected by the many recent
and upcoming changes to sponsored immigration routes, including
budgeting for additional application costs.
Monitor Home Office announcements or sign up to receive our updates so you
don’t miss a thing.
A summary of key 2025 changes that will have an impact in
2026
Many of the changes we expect to see in 2026 follow on from work
that started last year. We’ve summarised these in the
accordions below.
Expanded illegal working regime
Affects all businesses
What happened in 2025?
The Border Security, Asylum and Immigration Act 2025 was passed on 2 December 2025. It forms the basis
of the government’s planned expansion of the existing illegal
working regime, bringing it one step closer to implementation.
All businesses are likely to be affected by the planned changes
to a greater or lesser extent, depending on the range of
arrangements used to engage workers.
What’s expected in 2026?
Expanded right to work checking obligations and illegal
working liability risks
The expanded illegal working regime is expected to be
implemented in 2026. It will cover non-employees engaged by
businesses, both directly and indirectly. This will dramatically
increase the level of illegal working risk exposure for
businesses.
As part of implementing the provisions, the Home Office will
issue substantial revisions to their guidance documents, which
businesses will need to understand and comply with. Read more here.
Earned Settlement
Affects all businesses
What happened in 2025?
Proposals for an earned settlement model would extend the
standard 5 year qualifying period for settlement to at least 10
years in many cases. The Government consultation runs until 23:59 GMT
on 12 February 2026.
Earned settlement has major implications for workforce planning
across sponsored and non sponsored populations. Read more in our
series of articles covering the minimum mandatory requirements, the qualifying period, the impact on Skilled Workers, the impact on British Nationals (Overseas),
and the proposal not to have transitional arrangements.
What’s expected in 2026?
Implementation of the earned settlement
model
We expect the changes to start to come into force from April
2026, but further clarifications on timelines are awaited from the
government. Those who anticipate becoming eligible for settlement
before April 2026 should plan to apply at the earliest
opportunity.
You should understand what’s being proposed and map out a
contingency plan as early as possible. This can then be finalised
once the earned settlement policy is published.
The changes will require sustained, long‑term engagement
with affected staff members. This is likely to require a review and
alignment of your immigration and employment law policies.
If you sponsor workers, the period of sponsorship may be shorter
(for some high earners) or longer than it is currently. You will
need to consider budgeting for longer sponsorship in some
cases.
For a more detailed list of action points for Skilled Worker
sponsors, see our article here.
Skilled Worker route amendments
Affects sponsors
What happened in 2025?
The July 2025 changes included a sharply higher
salary requirement, the introduction of a Temporary Shortage List
(TSL), and the removal of many medium skilled occupations from
eligibility. Transitional arrangements apply.
What’s expected in 2026?
Revision of general and occupation-specific salary
thresholds
The Migration Advisory Committee (MAC) has recently recommended maintaining the general threshold
at £41,700, but reducing occupation-specific thresholds from
the 50th to 25th percentile.
A separate general threshold of at least £30,900 is
recommended for TSL roles (on the assumption that these roles will
not lead to settlement in future), with occupation-specific
thresholds set at the 50th percentile.
A revised new entrant salary requirement of £33,400 is
also suggested, with no occupation-specific threshold being applied
to this group. The MAC has also suggested a range of options for
extending the duration of the new entrant beyond 4 years, and
making the discount available for the full period independently of
the length of the initial visa.
Occupations on national pay scales should remain paid in line
with these, and have a general salary threshold set at Band 5 in
the lowest-paying nation.
The MAC recommends that salaries for Health and Care roles not
on national pay scales should be set in the same way as for other
Skilled Worker roles, potentially with some transitional
arrangements for roles below degree level.
Abolition of the salary discount for roles requiring a PhD is
also recommended.
The Home Office has not yet confirmed whether and when any of
the recommendations may be adopted. Implementing threshold
reductions may be considered too risky politically.
Temporary Shortage List review
The current TSL is due to expire on 31 December 2026. A
replacement list is expected to be implemented before this, taking
into account recommendations from the MAC’s review of the TSL which is due to be published
in July 2026.
Equality (Race and Disability) Bill
This could require equal pay for sponsored and non sponsored
workers, which may clash with sponsorship salary thresholds. Timing
is uncertain, so factor in possible pay alignment pressure in
2026.
Increased costs and cost-related compliance
Affects sponsors
What happened in 2025?
The Immigration Skills Charge increased by 32%
from 16 December 2025, adding £1,600 over 5 years for a
medium or large sponsor of a non exempt worker. Sponsor priority
service fees also increased from £200 to £350 per
request.
These changes increase the cost burden to sponsors, who in
addition must not pass specific sponsorship costs onto Skilled
Workers (including in all circumstances the ISC).
Since April 2025, certain salary deductions, loan repayments and
investments in the sponsoring business have been excluded from
counting towards Skilled Worker salary thresholds. Read more on
this development in our article.
What’s expected in 2026?
Extension of the ban on passing on costs to other
sponsored work routes
The ban currently only applies to Skilled Workers, but the plan
is for it to be rolled out to other sponsored work routes. Read
more in our article. We can expect to see this happen in
2026.
General compliance changes
Affects sponsors
What happened in 2025?
Here’s a summary of small changes with significant impact
that sponsors should be aware of.
Extended cooling off period: A cooling off
period of at least 2 years applies to businesses whose licence is
revoked for repeated non compliance or serious immigration
breaches, during which a fresh licence cannot be obtained.
Wider responsibility for compliance: A Person
with Significant Control of a sponsoring business is now within the
scope of the Home Office’s considerations on licence grant,
compliance, and any suspension or revocation action.
Access changes to the Sponsor Management System
(SMS): The primary Level 1 User of the SMS must be an
employee, director, or partner of the sponsoring business and a
settled worker. Transitional arrangements apply to sponsors who
applied for their licence before 31 December 2024.
What’s expected in 2026?
Sponsor licence compliance to remain a focus for the
Home Office
We anticipate that suspension and revocation action for sponsors
will remain high and could further intensify if there is
non-compliance with the expanded illegal working regime.
We strongly recommend you proactively review your sponsor
licence compliance, including identifying if a new sponsor licence
is required due to historic group restructuring. This is an aspect
the Home Office is scrutinising more routinely.
Maximum duration to increase for sponsor licence action
plans
This will increase from 3 months to 12 months, with revocation
action to follow if a sponsor fails to pay for the action plan, the
action plan is not complied with, or the sponsor fails to make the
improvements required by the end of the action plan.
Worker protections
Affects sponsors
What happened in 2025?
Publication of the government’s immigration White Paper, which includes proposals for new
worker protections.
What’s expected in 2026?
Changing sponsors may become easier for
workers
The government will consider making it easier for sponsored
workers to move between sponsors during the validity of their
immigration permission, with a view to reducing the risk they will
be exploited by being ‘trapped’ with an abusive
sponsor.
This change, if implemented, may require sponsors to reevaluate
their immigration and employment policies to retain staff.
Fair Work Agency to enforce employment laws
The Fair Work Agency will be established in April
2026 (but will only become fully operational once the
responsibilities of the agencies it replaces are transferred). Its
enforcement powers will be applicable to businesses found guilty of
serious employment law breaches, and the Home Office intends to
back this up with ‘tougher rules on sponsors flouting employment
law‘.
Visitors
Affects all businesses
What happened in 2025?
Full rollout of the Electronic Travel Authorisation (ETA) for
eligible visa-free nationalities from 2 April 2025. This is a
pre-entry requirement for visit and other short-term purposes. For
further information on ETAs, see our article here.
What’s expected in 2026?
Full enforcement of ETAs
This will go live from 25 February 2026 following the end of an
implementation period.
ETA-required passengers will not be able to board without one,
so business travel policies should factor in a process for checking
eligibility and applying in good time.
We anticipate more complex cases may come to light once ETA is
fully enforced. For further information on how we can help with
these, see here.
Greater scrutiny of business visitors
As sponsored work routes tighten, we anticipate more active
scrutiny of the genuine visitor requirements in business visitor
applications and arrivals.
You should ensure that the scope of activities for visitors is
well defined and checked from an immigration perspective in
advance, that visa applications are well-prepared and that
invitation letters are clear and accurately reflect the proposed
activities.
Contact a member of our immigration team if you need assistance with
compliance advice or with an application.
eVisas on approval
Affects all businesses
What happened in 2025?
The issuing of eVisas on approval happened for Skilled Workers
initially and was then extended across other work routes and
dependants. It has a direct impact on right to work processes and
record keeping. This development furthers the government’s goal
of operating a fully digital immigration system.
What’s expected in 2026?
Further rollout of eVisas
Visa stickers (vignettes) will stop being issued during 2026.
Make sure you have robust processes and systems in place for the
completion of compliant right to work checks in line with the
guidance as it evolves.
Other route-specific and system shifts to watch
Here’s a summary of other changes that all businesses should
be aware of:
Higher English language requirements for some work
routes: For main applicants applying from 8 January 2026
in the Skilled Worker, High Potential Inpidual and Scale-up routes,
the English language requirement is raised from Level B1
(intermediate) on the Common European Framework of Reference for
Languages (CEFR) to Level B2 (upper intermediate). Only those who
need to rely on an approved English language test are affected, so
we suggest flagging the new requirement as early as possible to
give candidates the maximum time to prepare and sit the test. Those
who intend to switch immigration route in-country before the expiry
of an existing visa should ensure they sit the test in good time if
required. Students and Graduates should not be affected as CEFR
Level B2 English is ordinarily required under the Student route and
they can rely on having met the requirement in that previous
application. Inpiduals already in the Skilled Worker or Scale-up
routes are not affected by this change and can continue to apply in
their existing route without needing to meet the higher English
language requirement, provided they still have (or were last
granted permission in) that route. There is the possibility of
further policy development in this area, as the MAC has mentioned
in its most recent annual report that ‘high language
requirements may exceed employers’ requirements, in which case
such requirements may exclude workers who would otherwise have
brought economic benefits and technical skills that are in high
demand in the UK’. This issue may be touched on in the
MAC’s review of the Skilled Worker Temporary Shortage List,
which is due to be delivered in July 2026.
English language requirements for all adult work route
dependants: Adult work route dependants will be required
to meet stepped English language proficiency criteria starting at
A1 (beginner) for their initial application, rising to level A2
(elementary) at extension stage and level B2 (upper intermediate)
at settlement. The implementation date for this is not yet known,
but is expected during 2026.
Shorter Graduate route: The length of
permission under the Graduate route is being lowered from 2 years
to 18 months for all applicants other than those with a PhD. The
permission for PhD graduates will remain at 3 years. This change
will affect inpiduals applying for the Graduate route on or after 1
January 2027. The reduced length of Graduate permission, combined
with the abolition of the long residence settlement route (see
below) and increased ISC may mean more and earlier requests for
sponsorship, and more consideration of Student to Skilled Worker
switches.
Amendments to salary requirements in work
routes: In addition to the Skilled Worker route salary
amendments discussed above, the MAC has recommended the following
changes, which the government will consider implementing:
Senior or Specialist Workers: General threshold to be set at
the median salary figure for eligible occupations, with
occupation-specific thresholds rising from the 25th percentile to
the 50th;
Graduate Trainees: A single salary threshold of £33,400,
in line with the recommendation for new entrants under the Skilled
Worker route;
UK Expansion Workers: General threshold to be set at the median
salary figure for eligible occupations, with occupation-specific
thresholds to be set at the 50th percentile; and
Scale-up: Salary thresholds set in line with the Skilled Worker
route (with the MAC also suggesting that the route could be
abolished entirely without much consequence due to low
take-up).
Abolition of the long residence settlement
route: Once earned settlement is implemented, the
government intends to close the long residence settlement route.
Affected inpiduals who wish to stay in the UK may seek sponsorship
or pursue other extension options if they are eligible. If you have
employees in this position, we suggest starting discussions about
their plans and possible options as early as possible.
Earned citizenship: Once the earned settlement
model is in place, the government intends to introduce an aligned
earned citizenship model. This will require amendments to primary
legislation, so changes to citizenship may not happen this year.
Our expectation is that it will be more difficult to become a
British citizen under the earned citizenship model than it is
currently. Those with settled status under the EUSS, people who
have been granted settlement before the implementation of the
earned settlement model and children are likely to be adversely
affected. There could also be knock-on effects for those who wish
to bring a partner or other family member to the UK. This is
because under the earned settlement proposals, family members of
British citizens may be eligible for a 5-year discount on their
qualifying period for settlement.
Settlement for EU Settlement Scheme pre-settled status
holders: Since the beginning of 2025, some EEA/Swiss pre
settled status holders may be granted settled status automatically.
However, an automated upgrade is not possible for many applicants.
Pre-settled status holders may wish to take advice on their
eligibility for settlement, with a view to applying as soon as
possible and, in turn, obtaining British citizenship before earned
citizenship is implemented.
Conclusion
The government’s planned changes this year are intended to
profoundly influence the behaviour of businesses and inpiduals
using the immigration system.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.