The UK’s proposed “earned Settlement” system: What you need to know

The Home Office has opened a major consultation on plans to overhaul the UK settlement system—proposals that could reshape long-term migration routes, employer sponsorship strategies, and the expectations of anyone currently working toward Indefinite Leave to Remain (ILR).

These changes, set out in the policy paper A Fairer Pathway to Settlement, are among the most far-reaching in years. In our latest episode of The Employment Law Podcast, our immigration partners, Alex Finch and Rebecca Tester explore the detail behind the proposals and what they may mean in practice Below is a summary of some key themes; listeners can dive into the full conversation for deeper analysis.

A move to a 10-year baseline for settlement

At the centre of the proposals is an increase in the standard qualifying period for settlement from five years to ten years. This alone represents a major shift, doubling the timeframe for most work-route migrants to secure ILR.

However, the consultation also introduces the concept of “earned settlement”, a points-based system allowing the qualifying period to be shortened (or lengthened) based on individual circumstances.

Earning earlier settlement: Language, earnings, and integration

The Home Office proposes that certain measurable factors could accelerate eligibility for ILR, including:

• Advanced English language skills (C1 level), which could reduce the qualifying period by one year

• Consistently high taxable earnings, with those earning above £125,140 for three years potentially reducing the period by up to seven years

• Earnings above £50,270, or work in specific public-sector occupations, potentially maintaining a five-year route

This approach places significant emphasis on economic contribution and integration, and marks a shift away from a simple “time served” model.

Longer routes for some groups

Not all groups would benefit from acceleration. The proposals outline several factors that would lengthen the route to settlement:

• Receipt of public funds—potentially adding 5 or 10 years to the qualifying period

• Unlawful entry, which could add up to 20 additional years

• Overstaying by more than six months

• Entry through the Health and Care Worker route, which could see the baseline extended to 15 years

This last point has attracted particular concern. Many in this cohort entered the UK legally through routes created specifically to address post-pandemic shortages. The consultation now raises the possibility that they may face significantly longer periods before qualifying for ILR.

Practical implications for employers

With such wide-ranging proposals on the table, employers may need to reassess long-term workforce planning. Some of the potential considerations include:

• Reviewing whether key staff may qualify for accelerated settlement

• Exploring whether revised salary thresholds could reduce overall sponsorship costs

• Supporting eligible employees to apply for ILR before any new rules come into effect

• Monitoring the consultation to understand how transitional arrangements may affect existing sponsored workers

For some employees, the proposals could present new opportunities. For others, particularly those in lower-paid or medium-skilled roles, the impact may be far more challenging.

What happens next?

The public consultation remains open until 12 February 2026, and the Home Secretary has suggested a desire to implement changes as early as April next year. Given the complexity of the proposals, a phased rollout is possible, and significant administrative challenges lie ahead.

Listen to the full episode

For a more detailed, practical, and balanced walk-through of the proposals, listen to the full episode of The Employment Law Podcast by Constantine Law. It offers valuable insight for employers, HR professionals, and individuals navigating the UK immigration system.