ICT reform set to boost contractors
Essential reforms of the Intra-Company Transfer (ICT) visa system are finally in the pipeline, as I outlined in the IPSE Magazine earlier this year. This is something IPSE has long called for, and now the Migration Advisory Committee (MAC) emphasised the rationale for these changes in a new report.
We have consistently criticised the ICT system as being open to abuse by large outsourcing companies, leading to some of those working as ICTs being underpaid and exploited, and contractors undercut as a result of an uneven playing field. Echoing our concerns, the MAC declares many of these outsourcing companies to be ‘in contravention of regulations’ – with ‘the ready supply of (mainly Indian) IT workers doing routine work instead of the specialist or senior manager tasks required’.
The graphic below from the report summarises the problem well, outlining how the current system has failed and why they hope the proposal for a higher minimum salary threshold will help matters. It shows that large outsourcing companies have been increasingly exploiting the rules, bringing in unskilled workers from overseas to cut costs and undercutting UK residents, when the system is supposed to be about bringing in overseas specialists.
Work, immigration and the labour market: Incorporating the role of the Migration Advisory Committee, 2016
IPSE fed into the MAC consultation that led to the proposal for a higher minimum salary threshold, and we think it will go a long way towards tackling abuse of the rules by large outsourcing companies.
We are continuing to press the government to ensure there aren’t any loopholes in the system. The government is currently reviewing how allowances are considered, and it must be clear that these cannot be counted as salary if the system is going to work. But we are certainly encouraged that policy is going in the right direction, as we move towards a level playing field for IT contractors in the UK.
You can read my full article on ICTs in the IPSE Magazine here.