Business migration rules could penalise smaller employers

Smaller firms could be unfairly treated if plans go ahead to allow large companies to sidestep the rules on the number of non-EU workers who are allowed to enter the UK, a leading business group has claimed.

The Forum of Private Business (FPB) has said that possible government proposals to exempt intra-company transfers from its forthcoming cap on migration would place SMEs at a competitive disadvantage.

The Prime Minister, David Cameron suggested in the House of Commons that big businesses may be free to transfer staff from outside the EU to work in the UK despite the government's planned immigration cap, which is aimed at restricting the level of non-EU immigration.

If implemented, the exemption would enable multi-national firms to hire employees through their offices overseas in order to bring them to the UK.

But, the FPB argued, this option would not be open to the vast majority of SMEs because they rarely have a base outside the UK. The result would be to leave them struggling to recruit key, highly-skilled employees and struggling to compete with larger rivals as a result.

Phil McCabe of the FPB said: "We appreciate that immigration is a sensitive issue, particularly in the current climate of high unemployment and strained public services.

"However, if the government is going to restrict economic migration, it should do it in a way which affects businesses of all sizes equally. To give huge multi-national corporations another competitive advantage over small businesses strikes us as being completely unfair.

"While most small businesses will only ever need to source workers from within the EU, a significant number - particularly those in scientific sectors such as engineering or pharmaceuticals - need highly specialised skills which require recruitment on a global basis. This is difficult enough already due to the number legal requirements involved.

"If the government creates what would effectively be a big business-only loophole to get around the cap, it would clearly fly in the face of everything the coalition has said so far about wishing to support small businesses and initiate an SME-led recovery."