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Staff shortages to hit crisis levels

Published:  23 June, 2021

Staff shortages in the hospitality sector are set to hit crisis levels following the 30 June, when it will become more difficult to hire EU workers, a leading City law firm has warned.

The hospitality sector has already experienced severe labour shortages due in part to workers from overseas leaving the UK to return to their home countries either because of Brexit or the pandemic.

Law firm Bates Wells said there are currently no provisions for low-skilled workers under the new points-based immigration system. As a result, it will be extremely difficult to hire non-British/Irish nationals or EU workers who don’t already have the right to work after the grace period elapses 30 June. 

Chetal Patel, partner at Bates Wells said: “The 30 June deadline will create enormous problems for businesses in the hospitality and leisure sectors. These businesses are already seeing severe labour shortages. This is set to get significantly worse.

“EEA workers comprise 7.3% of the UK’s working population. There are entire industry sectors that are wholly dependent on labour from these countries.”

Patel has called on the Home Office to consider offering a temporary Covid-recovery visa, enabling businesses to hire overseas workers to fill vacancies and help to get the economy back on its feet after the devastating impact of lockdown.

Bates Well advised that after the Brexit grace period elapses, businesses may need to register as an Employer under the T5 Intern scheme in order to offer work experience to EEA nationals. With a £750 fee per candidate, Bates Wells said this would create additional financial and administrative burdens, particularly on small and medium businesses.

EEA nationals who want to come to the UK to do work experience will need to pay a fee of £189 or £244, depending on which country they are from.  

Patel adds: “We’ve seen a spike in queries from businesses looking to offer paid work experience to EEA or Swiss nationals from 1 July. The post Brexit era has made this more difficult and businesses now have to incur additional costs and go through the headache of exploring what options are left on the table."

The staffing crisis in the hospitality sector is prompting pubs and restaurants to turn to temporary staff and has forced them to increase wages by as much as 14%, according to Indeed Flex, the online marketplace for flexible workers.