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Additional changes in the Aliens Act

Immigration Alert

BACKGROUND

In February 2021, Deloitte wrote about the first interim report concerning the proposed measures for the improvement of the Swedish labor immigration system. In July 2021, we experienced the first revision as the requirements regarding permanent residence permits changed. On February 24th, 2022 the Swedish Parliament published a bill suggesting stricter and further enhanced laws on labor immigration which was adopted on April 20th, 2022 and will enter into force on June 1st, 2022. The new legislation consists of several efforts to provide legal basis to the current immigration system that is currently heavily case law based. Deloitte presents the new legislation below.

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SUMMARY

The Swedish Parliament has adopted the following changes to the Aliens Act:

  • The current maximum limit for the permit period of 48 months, or 72 months under special circumstances, is removed
  • The possibility to waive revocations of permits is introduced into law and further extended
  • A requirement to include an employment contract with the application for a work and residence permit is introduced
  • An obligation for the employer to report impaired employment conditions is introduced
  • A maintenance requirement for accompanying family members of employees is introduced
  • A new type of permit for highly qualified job seekers and entrepreneurs is introduced
  • Increased opportunities to apply for a change of status and national visas from inside the country are introduced
  • The number of employer compliance checks are to be increased
  • Revocation of family members’ permits is made possible
  • The opportunity to receive residence-based social benefits during the processing time of an extension application is introduced

1. Measures to counter competence expulsions

Removed limitation of maximum permit time

Today, a third-country national can be granted a work and residence permit for a maximum of 48 months, with the possibility of a further extension of up to 72 months in exceptional cases. This time limit will be removed. The purpose is to enable third-country nationals who do not want to settle permanently in Sweden to continue working after they have reached a 48-month stay in the country, and thus retain valuable competence in the country.

Exceptions from a mandatory revocation are introduced

Supplementary provisions for when the Swedish Migration Agency can refrain from revoking a permit are introduced. Circumstances in which the Migration Agency can refrain from revoking a permit after an overall assessment are currently found in court practice (such as the Lucia rulings of 2017). This is now being incorporated into the legislation.

Despite the rulings, expulsions of highly skilled immigrants still take place where revocations are being enforced even though there are minor errors in their permit history. The Parliament has now clarified that the assessment of whether a deficiency is to be considered minor must include the question of the magnitude of the deviation, and the plausibility must be assessed in relation to the nature of the error. As an example, today the Aliens Act requires the Migration Agency to revoke a permit that has not been utilized within four months of the first day of its validity, even in cases when the first day of utilization was 4 months and a week from the first valid day of the permit. Another example is a situation where occupational pension insurance has not been in place during a period, even if it has later been compensated for, as this could still lead to revocation per today’s legislation.

From June 1st, 2022 a permit can still be revoked for a minor error if its cause is not reasonable. For example, this may relate to an unreasonable explanation as to why there was an error, and it is uncertain as to whether the employer will rectify the error in the future. Finally, the Parliament highlights that the starting point for a permit not to be revoked is that the employer, as far as possible, tries to remedy the error as soon as it is discovered. This, however, does not have to be done before the Migration Agency points out the error, which previously was the case.

The fact that an increased array of possibilities for waiving revocations are now introduced is a positive development. The new legislation demonstrates that allowances can be made for mistakes without compromising the ability to penalize actors that aim to exploit the labor immigration system. During the current pandemic, due to travel restrictions making it increasingly hard to relocate in time, not being able to meet the four-month requirement especially has led to increased competence expulsions. In these situations, even though the delay might not have been by the applicant’s own doing, the delay became a major risk factor when applying for an extension and caused a lot of unnecessary rejections.
 

2. The employment contract becomes part of the application and can be combined with an obligation to report changed employment conditions

Employment contract

The submission of an employment contract will be required for a work and residence permit to be granted to a third-country national. So far, the application for a work and residence permit has focused on the offered conditions. However, the new legislation turns the focus to the actual receipt of the offered conditions. The purpose of this is to counteract the dependency a third-country national may experience and, due to this dependency, the willingness to accept inferior employment conditions than those originally agreed upon. This tendency to change the employment conditions is something the Migration Agency has reported to be frequently occurring in certain industries.

It is worth noting how the review of the employment contract should be implemented. Initially, the Migration Agency will only check that there is an employment contract in place and that the conditions for a work permit stated in the Aliens Act are met. If the requirements are not confirmed to be present in the employment contract, the applicant will have to demonstrate that the requirements in question have been met by submitting additional proof.

This addition to the Aliens Act will entail a greater administrative burden for the employer as the appearance and content of the contract may need to be altered. The process becomes dependent on an employment contract being signed and submitted, which in turn may cause longer lead times for an employer to employ a third-country national. Challenges related to the contract, any complex compensations structures, and the Migration Agency’s interpretation of these can also arise. Finally, it would have been desirable to clarify how the employment contracts will be handled in the case of an extension application (for example, if a contract is expected to be submitted, and if so, if it must be continuously updated).

Obligation to report

The Migration Agency may impose an obligation to report if working conditions offered to a third-country national are changed for the worse and assess a fine if these changes are not reported. Introducing an obligation to report will require an increased understanding and follow-up of the labor law and immigration requirements by the employer. Changes to be reported refers to a third-country national’s salary, insurance coverage, and other terms of employment. The Migration Agency’s evaluation of a changed condition will be made for each respective requirement separately. If, for example, an employer removes one insurance but increases the salary, it must be reported to the Migration Agency since such a change, depending on the circumstances of the individual case, could lead to a revocation of the work and residence permit. Hence, a higher offered remuneration cannot be assumed to compensate for another changed condition per se. Any changes in the employment terms must be reported to the Migration Agency no later than one month after these have entered into force.

3. Maintenance requirement for accompanying family members of employees

Today, family members of a third-country national who is in Sweden on a work permit may be granted a residence permit for the same period as the employee as long as that employee’s permit is valid, and the family ties established. No additional requirements are set by the Aliens Act. The new legislation introduces a maintenance requirement for the employee. This requirement will be modeled after the maintenance requirement that applies to other types of family immigration permits. The income level set will be linked to the number of family members, housing costs, and the Swedish Enforcement Agency’s ‘standard amount’. The purpose of introducing a maintenance requirement is to avoid unnecessary strain on the social insurance system and to counteract potential abuse of the immigration system.

If the housing cost is unknown at the time of the application, the assessment will be made in relation to the average cost situation (the standard rent) in the locality. The Parliament states that a housing requirement (size and standard) will not be introduced. However, if the employer provides the employee with housing, certain conditions (which are already regulated by law) must be met concerning the standard of housing and the rental cost.
 

4. New type of permit for highly qualified job seekers and entrepreneurs

To increase international recruitment of highly qualified personnel, a new type of permit aimed at those who intend to look for a job or investigate the conditions for starting their own business is introduced. The permit is to be granted for a maximum period of nine months and the requirements that will be imposed are the following: a completed postgraduate education (minimum master’s degree), sufficient funds for subsistence covering the requested permit period, and funds for a possible return ticket as well as health insurance. No work permit will be granted initially since the idea is that an application for a work and resident permit should be submitted when employment has been obtained or a business is started. At that time, such an application will be possible for the applicant to submit without leaving the country, and the applicant is expected to be able to work during the processing of their work and residence permit. There will be no possibility to bring along dependents under this new type of permit.

The introduction of this new permit is positive as it allows a highly educated individual to familiarize themselves with the Swedish labor market before accepting a job offer, which in turn provides greater opportunities for the Swedish labor market to connect with foreign competence. Good to know is that the requirement for advertising positions within the EU before employment will remain. The new permit has, however, been met with some criticism as it is feared that highly qualified workers will take jobs in low-skilled occupations to be able to enter the country and that this risk of exploitation might outweigh any benefit of the new permit.
 

5. Other changes to note

Apart from the above, the new legislation includes increased opportunities for status changes without having to leave the country. This, together with the possibility to apply for a national visa from within the country, will provide applicants with more flexibility to travel while the Migration Agency processes their permits and will give third-country nationals greater freedom to adjust after relocating. Further, increased checks on employers who have employed third-country nationals are introduced. An additional change is that third-country nationals should have access to residence-based social benefits even during the processing time of an extension application. Finally, the possibility to revoke an accompanying family member’s permit if the family member’s connection to the employee comes to an end, or if the employee’s permit is revoked, is introduced. This legal option is missing today and would in practice mean making the immigration status of close relatives conditional.

Deloitte’s summary comments

The new legislation incorporates several welcomed changes allowing the Swedish job market to continue to attract foreign competence to Sweden. In particular, the removal of the maximum permit period and the review of the revocation rules will have a positive impact on Sweden’s opportunities to attract and retain a highly qualified workforce.

The labor migration process is, however, at the same time more restricted through the new requirements of an employment contract, the obligation to report changes, and, above all, the introduction of a maintenance requirement. The administrative requirements for employers and employees will increase, thus, it becomes important that clear guidelines and specifications are provided by the Migration Agency to ensure predictability in the processing. The new legislation and the underlying investigations are primarily aimed at certain industries, yet it will have a major impact even on industries where exploitation is rare.

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