Big business immigration loophole would be unfair on small firms, Forum warns.

Possible plans to allow multi-national companies to bypass immigration laws would be hugely unfair on smaller firms, it has been warned.

The Forum of Private Business believes potential government proposals to exempt intra-company transfers from its forthcoming cap on migration would put small and medium-sized enterprises (SMEs) at a competitive disadvantage.

David Cameron indicated this week that big businesses may be free to transfer their staff from outside the EU to work in the UK, despite the Government’s forthcoming immigration cap, which is likely to severely restrict the amount of non-EU nationals coming to Britain.

The revelation, which emerged during Prime Minister’s Question Time on Wednesday, is likely to mean multi-national firms will be able to quickly and easily hire employees through their offices overseas in order to bring them to the UK.

However, the vast majority of SMEs would be unable to do this as they rarely have a base outside the UK. This could leave them struggling to recruit key, highly-skilled employees – and struggling to compete with larger rivals as a result.

Forum spokesman Phil McCabe 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.”

Previous research carried out by the Forum has found smaller employers highly value being able to employ both skilled and unskilled staff from overseas.

Additionally, Forum members consistently cite difficulties in recruiting workers with specialist skills as a major threat to their businesses. In December 2009, the Forum’s Referendum ballot found only 1% of respondents believe the skills of their local workforce are ‘excellent’ and only 25% described them as ‘good’.

The Forum also discovered a strong perception that industry-specific skills are in serious shortage. Over a quarter (26%) of respondents said they believe industry-specific skills are ‘poor’ – and 11% described them as ‘very poor’.

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