When will this take effect?

The consultation is open until 11:59 p.m. on 12 February 2026. No changes have taken effect yet.

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Core Pillars of the Proposed Settlement System

Under the “Earned Settlement” model, eligibility would be assessed across four pillars:

1. Character: Clean immigration history and no criminal record.
2. Integration: Higher English language level (B2), Life in the UK test, and engagement in British society (e.g., community or voluntary activity).
3. Contribution: Economic participation including sustained taxable earnings, NIC contributions, and potentially public service roles.
4. Residence: Longer periods of continuous residence, with a greater focus on the updated purpose of rules.

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Proposed Timelines

Most work-based routes, including Skilled Worker, could move to a 10-year pathway.

It is worth noting:

• Accelerated Settlement for High Contributors:
  Individuals who demonstrate sustained higher earnings or strong “contribution” indicators may qualify in fewer than 10 years.
• Extended Timelines for Lower-Skilled Routes:
  • Lower-skilled and certain health/care roles may require 15+ years before becoming eligible for settlement.
  • This may affect sectors already experiencing high turnover and routes remaining at 5 years.

Some categories will remain under the existing 5-year pathway, including:

• Partner/spousal routes
• Dependants of British citizens
• Global Talent
• Innovator Founder

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Implications for Employers

The proposals, if implemented, will materially change how businesses plan and manage sponsored employees. Employers should expect:

• Increased Retention Risk:‍
  
  • A longer settlement pathway (10–15 years) may make UK roles less attractive to international talent.
  • Employees who currently plan for ILR at year 5 may delay relocation decisions or look to other markets.
• Higher Long-Term Sponsorship Costs:
  With longer residence periods before ILR, businesses may face:
  • Multiple additional visa extensions
  • Higher Immigration Skills Charge exposure (with the ISC already rising from £1,000 to £1,320 per worker per year)
  • Greater internal HR compliance burden
  • More frequent right-to-work checks and document renewals
    This has direct financial implications for budgeting and mobility strategy.
• Workforce Planning Pressure:
  Employers may need to reassess:
  • Long-term workforce modelling
  • Succession planning
  • Reliance on roles at RQF Level 3–5 (which may face the longest settlement paths)
  • Incentive structures to retain talent through extended sponsorship periods
• Impact on Family and Stability for Key Talent:
  Adult dependants may need to accumulate their own qualifying residence period rather than relying on the main applicant.
  This may reduce the attractiveness of UK assignments for mid-career employees with families.

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What Can Employers Do Now?

At this stage, employers should simply stay alert to developments, as no settlement changes have been implemented.
It may be sensible to review which employees are approaching five years’ residence in 2026 and consider whether an earlier ILR application could be beneficial.

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Businesses can also begin light-touch internal planning around potential budgeting and retention impacts, ensure managers are prepared to communicate developments to affected staff, and avoid making any long-term decisions until the Government publishes its final consultation response.

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For now, these proposals remain only proposals, with further clarity expected in early 2026 before any formal rule changes are introduced. We will continue to monitor these changes and provide further information once available.

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Contact and Disclaimer

Should you have any questions regarding the above information, or require assistance with your immigration or global mobility matters, please don’t hesitate to contact our legal team at Hudson McKenzie. You can reach us by email at londoninfo@hudsonmckenzie.com or by telephone at +44 (0) 20 3318 5794.

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For office locations, please visit our Our Offices page.

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The information provided in this blog is for general guidance only and does not constitute legal advice.