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The revised Blue Card Directive: the EU's search for more highly skilled non-EU migrants

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21 May 2021

The EU institutions have approved a revised 'Blue Card Directive', which sets out rules on the migration of highly-skilled non-EU migrants. Steve Peers, Professor of Law at the University of Essex, explains the new rules and their possible effects.

One sign of the difficulty in resolving differences of opinion within the EU on immigration and asylum issues (other than visas and border controls) is that no new legislation on these issues has been agreed since 2016 (that was the revised Directive on admission of students, researchers and trainees, discussed here). This five-year drought may soon to come to an end, with the recent agreement on revision of the Blue Card Directive on highly-qualified non-EU workers. (Note that the recent deal must still be formally approved by the Council and the European Parliament. This blog post is based on the full legal text of the agreed revised Directive, which is being made public here).

See the text: Proposal for a Directive of the European Parliament and the Council on the conditions of entry and residence of third-country nationals for the purposes of highly skilled employment - Confirmation of the final compromise text with a view to agreement (Council document 8585/21, LIMITE, 19 May 2021, pdf)

Background

The existing Blue Card Directive was adopted in 2009. While it aimed to encourage admission of highly- qualified non-EU migrants, a report in 2014 (discussed here; the summary below draws on this earlier blog post) indicated that it had modest impact. Therefore the previous Commission tabled a proposal to replace it in 2016 (discussed here). The Council agreed its negotiating position in July 2017, as did the European Parliament. However, negotiations between the two institutions were difficult (see reports of December 2017, February 2018 and December 2018), and ended at the start of 2019. However, they were resumed in autumn 2020, leading ultimately to the recent agreement.

The UK, Ireland and Denmark opted out of the 2009 Directive and the 2016 proposal. However, having since left the EU, the current Directive is, and the revised Directive will be, relevant to UK citizens seeking to move to the EU after the end of the transition period in the withdrawal agreement, i.e. from the start of 2021.

The current law

What are the main features of the current law? First of all, it co-exists with national law on admission of highly-qualified workers. Next, Member States or the EU can enter into more favourable treaties with non-EU countries. Other EU law can set higher standards than the Directive, whereas Member States can set higher standards for some of its provisions.

The conditions for admission include a salary threshold of at least 1.5 times the national average. As an option, Member States can reduce this to 1.2 times the average for some jobs (managers and professionals). Highly qualified employment is defined as having a higher education qualification of at least three years. As an option, Member States may accept admission of those with five years’ professional experience in a field. They must have a work contract or job offer valid for at least one year. Member States can determine a quota of the overall numbers to be admitted to their territory.

A Blue Card must be valid for a period of between one and four years. Member States may choose to apply a labour market preference for EU and resident non-EU citizens (including long-term resident non-EU citizens in another Member State) upon first entry and during the first two years of residence. They may also choose to reject an application for ethical reasons (i.e. trying to avoid a ‘brain drain’ from developing countries).

Applications can be made from outside the country or when legally resident, although Member States may opt to be more generous (considering applications also from those legally present), or less generous (requiring applications from outside the country, if national law provided for this when the Directive was adopted). Member States have to decide on an application within 90 days, and inform the applicant as to the reasons for any rejection. Refusals, non-renewals or withdrawals of Blue Cards must be open to legal challenge.

As for the rights of Blue Card holders, they are restricted to employment meeting the criteria for initial admission for two years. After then, Member States may treat them equally with nationals as regards highly-skilled employment. After two years, changes in employment are subject to prior authorisation of the authorities.

Blue Card holders can stay if they become unemployed and look for a replacement job – unless this happens multiple times or the unemployment lasts for more than three months. They have equal treatment with nationals as regards working conditions, education, social security and recognition of diplomas (except for study loans or grants and housing).

There are also rights for family members, derogating from some limits on family reunion in the relevant EU Directive. Blue Card holders do not need a minimum residence period or a prospect of long-term residence for their family member to join them. Integration measures can only apply after entry, and there is a shorter deadline for issuing permits.

Furthermore, there are derogations from the EU law on long-term resident (LTR) non-EU citizens. Blue Card holders can cumulate periods spent in multiple Member States, subject to certain conditions, to qualify for long-term residence status. There are longer permitted absences from the territory. And even before qualifying for LTR status, which takes five years, Blue Card holders can move to other Member States after only 18 months, subject to still carrying out highly-qualified employment (among other conditions).

The 2014 report

According to the 2014 report on the application of the Directive, the numbers admitted with a Blue Card were modest (15,000 in 2013). Eight Member States had set a quota for the number of admissions. Six Member States opted to reject applications in national law on ‘brain drain’ grounds, although none had actually rejected an application on these grounds. However, only two Member States had set higher salary thresholds than the usual rule (1.5 times the average salary) set in the Directive. Nine Member States legislated for the option to have a lower salary threshold for some workers, although only four made active use of it.

Most Member States applied some kind of labour market test before issuing a Blue Card. One Member State had set an overall time limit of four years for Blue Card holders, even though there is no explicit rule in the Directive on this point (as compared to the Directives on seasonal workers – discussed here – and intra-corporate transferees – discussed here).

Fifteen Member States had implemented the option to withdraw the Blue Card if the holder needs social assistance, and two Member States applied a pre-existing national rule requiring applicants to apply from outside the country of origin. About half the Member States required a 90-day wait for a decision on the application, and just under half set shorter deadlines. Nine Member States did not grant equal treatment in employment after a two-year waiting period, and most required authorisation in the event of a change in employer within that period. A number of Member States did not grant equal treatment in education, and about half of the Member States limited the application of a rule permitting longer absences from EU territory as regards acquiring long-term resident status.

On the other hand, some Member States exercised the options to apply more favourable rules. Twelve Member States opted to treat experience as equivalent to qualifications. Nine Member States took the option to set a lower salary threshold (1.2 times the average salary) for professions in shortage occupations. Most Member States allowed applicants to apply for a Blue Card not just if they were legally resident, but also if they were legally present. Several Member States had more favourable standards as regards equal treatment.

The Commission’s original impact assessment for the 2009 version of the Directive (see my discussion in the Commentary on EU Immigration and Asylum Law) suggested that the EU is comparatively weak at attracting highly-skilled migrants, in part due to its immigration regime. The main features of national immigration rules which attracted migrants were routes to permanent residence, geographical mobility, and the publicity effect of the schemes. Academic analysis also suggested that liberal rules on family reunion and job mobility were significant.

However, the main elements of the original Blue Card proposal which aimed to attract highly-skilled migrants were dropped or watered down: a short decision-making deadline; a derogation from the salary threshold for younger workers; and the rules on in-country applications, job mobility and validity of permits. The evidence as regards implementation of the Directive suggested that on most of these issues (except for in-country applications), most Member States apply the options in the Blue Card Directive in such a way as to deter applications. Moreover, the mere existence of competing national schemes diluted the publicity effect of the Blue Card system.

Impact assessment

The impact assessment for the 2016 proposal built upon the 2014 report and the impact assessment for the original Directive, noting again that the EU retained fewer highly-skilled workers than its competitors, and arguing again that there was a demographic and economic argument to attract and retain higher numbers. 38,000 residence permits for highly-skilled workers had been issued in 2014 – although that included not only Blue Cards but also national permits. These numbers had been increasing (23,000 in 2012; 34,000 in 2013) but still fell short of the numbers desired on economic grounds. (The national/Blue Card breakdown for those years was: national permits 19,755 in 2012, 21,940 in 2013, and 24,922 in 2014; EU Blue Cards 3,664 in 2012, 12,964 in 2013, and 13,852 in 2014).

In the view of the impact assessment, parallel national schemes were "neither effective nor efficient", with the "complexity of the current regulatory framework for recruiting" highly-skilled workers creating "costs and administrative burden". National schemes, by definition, could not offer the benefits of labour mobility between Member States, but the impact of the mobility rules in the 2009 Directive was "very limited".

It was also desirable to increase retention of students graduating in the EU – although the revised students’ Directive already aims to do that. The issue here was that new entrants to the workforce tend to obtain lower salaries than older workers, and so might fall short of the salary thresholds in the 2009 Directive. Also, the EU system did not include specific rules on highly-skilled migrants starting new businesses, which was a particular feature of the ICT industry. Applying the Blue Card system to refugees and others with international protection could address the problem that some of them are under-employed (i.e. taking jobs below their skill or education level).

In particular, workers were deterred by: the salary threshold; labour market restrictions; limited possibility of mobility; processing times; delayed admission of family members; the requirement of a one-year work contract (which is more restrictive than competing national laws); lack of familiarity with Blue Cards; and exclusion of entrepreneurs, service providers, and those with international protection.

Ultimately the Commission’s proposal aimed to address many of these points. However, it did not include service providers, despite raising the issue, due to a lack of evidence for a change in the law. It also ruled out the more radical step of moving to an "expression of interest" system.

(See also the executive summary of the impact assessment, and its Annexes).

The revised Directive

The revised Directive, if officially adopted, will expand the scope of the Directive to include refugees and other beneficiaries of international protection, as well as non-EU family members of EU citizens. The Commission also proposed that it should also apply to non-graduates who had three years or more of equivalent professional experience. However, Member States thought this went too far, and the final text is a compromise: it will extend only to non-graduates with three years’ equivalent experience in the high-tech field. For other fields, Member States will have an option to apply the Directive to non-graduates with five years’ equivalent experience.

Next, the Commission had proposed to eliminate the possibility of parallel national schemes for highly qualified workers. However, the Council insisted on maintaining the possibility of such schemes, so the final Directive retains this option. As a compromise, there are new provisions saying that any more favourable rules relating to national schemes must also apply to Blue Card applicants or holders, as regards procedural rights, application fees, fast-track applications for designated employers, labour market access, equal treatment, and family reunion. On the other hand, Member States are not required to extend national rules on substantive conditions for admission to Blue Card applicants or holders.

Similarly, the Commission had proposed that Member States could only retain pre-existing treaties on highly qualified labour migration with non-EU countries, but not sign new ones – but the agreed Directive reverts to the status quo that new treaties are possible.

As for conditions of admission, the period of any contract or job offer necessary to apply for a Blue Card will be cut from one year to six months. The salary threshold will be set between the average salary and 1.6 times the average salary (the Commission had proposed 1 to 1.4 times the average salary). This threshold may be cut by 20% for recent graduates (within the last three years) and (as in the current law) for professionals and managers, but with a floor (added in the final directive): the reduced threshold cannot go below the average salary. (The Commission had proposed that both of these reductions would be mandatory).

A labour market preference test can still be applied on entry. The Commission’s proposal to limit its use was rejected (the proposal had suggested that it could only be imposed where the "labour market situation undergoes serious disturbances such as a high level of unemployment in a given occupation or sector, which may be limited to a particular part of their territory". Also the exception would only have applied in principle for 12 months, subject to 12-month extensions and notification of the Commission). Quotas on entry can still be applied too (the Commission had not proposed to abolish them as regards the first Member State, as the Treaties guarantee Member States the right to set them).

The Commission had proposed to remove recourse to social assistance as a trigger to withdraw Blue Card status, but the final Directive retains it. At the behest of the European Parliament, it will be harder to withdraw a Blue Card from a holder due to unemployment.

Blue Cards will now be valid for a minimum of two years (in place of one to four years in the 2009 Directive). Applications for a Blue Card will now be possible whenever the applicant is legally resident; the limited derogation allowing Member States to ban in-country applications will be deleted. It will remain an option to allow applications from those who are legally present (the Commission had proposed to make this mandatory).

The time period to reply to applications will remain at 90 days (the Commission had proposed to cut it to 60 days). A new rule provides for decisions on applications to be fast tracked to 30 days if the employer is registered in a special scheme. There would be an express right to apply for renewal, a judicial remedy against refusals, et al, and a requirement that fees must be proportionate.

Next, labour market access for Blue Card holders will be wider. In place of the current rules (restriction to highly qualified employment for two years, changes of job subject to authorisation during that period, an option to allow equal treatment in labour market access after two years), Member States may apply a labour market preference test, and approval to change jobs linked to that test, if Blue Card holders seek to change jobs within the first year. After that they may only be required to inform Member States about a change of job. (This is a compromise compared to the Commission proposal, which had suggested that Member States would have to give Blue Card holders full access to highly skilled employment from the outset, with no requirement for approval to change jobs from authorities and no labour market preference test).

The revised Directive will provide that Member States now have an option to allow Blue Card holders to undertake self-employment in parallel with their employment – but they can set conditions and limits, and self-employed activity must be subsidiary. The Commission’s proposal here was more ambitious.

The waiting period for family reunion will be cut to nothing if applications for family members were submitted at the same time as the Blue Card application. If they were not, it will be cut to 90 days, instead of six months (the Commission had proposed 60 days). Family members will be able to take up any employment or self-employment. Member States will have to cumulate periods spent in different Member States towards the autonomous residence permit which a family member can obtain after five years (currently this is an option), although as a compromise compared to the Commission proposal, Member States may insist that the last two years of this period was spent on their territory.

There will also be new benefits as regards obtaining LTR status. The Commission’s proposal to cut the usual five-year wait to three years (subject to conditions in the event of unemployment) was rejected. However, it will be easier to accumulate five years’ residence in multiple Member States: Member States will have to cumulate not only residence as a Blue Card holder (as the current law provides), but also residence as a researcher, a student (subject to limits), a highly-qualified worker under national law, or a beneficiary of international protection to this end. (This is less liberal than the Commission proposal, which would have required cumulation of any periods spent as a legal resident on any basis in different Member States). The current requirement that the last two years must have been spent in the Member State where the application was made will be retained. On the other hand, the current option for Member States to limit access to LTR status after extended periods of absence will be dropped. (In other words, extended periods of absence for any reason will be able to count towards obtaining LTR status).

Before obtaining LTR status, the mobility provisions will be improved too. Blue Card holders will be able to carry out business activities in another Member State for 90 out of 180 days without a need for authorisation, although if they are travelling from a non-Schengen to a Schengen State for this purpose the latter may ask for evidence.

They will also be able to move fully to another Member State after 12 months, rather than 18. However, the final Directive did not follow the Commission’s proposal to simplify this process even more radically – namely, to allow a Blue Card holder to start work in the second Member State as soon as they had submitted the application. Rather, the final Directive provides that if the Blue Card holder moves from a non-Schengen to a Schengen State, the latter can ask for evidence at the border. Member States would have to decide on the applications within 30 days, but they can refuse if the Blue Card holder had been abusing the system. There will be further simplifications for family members joining them.

Finally, Member States will have two years to give effect to the revised law. The deadline to apply it will therefore likely fall in summer or autumn 2023.

Comments

Whether or not the EU should prioritise the admission of highly qualified non-EU workers and seek to encourage their admission, it is a long-established policy. The following comments focus on how much the revised law is likely to contribute to that objective.

Although many of the Commission’s planned suggestions for reform of the Blue Card system were not accepted in full, most were accepted in part, on the basis of some form of compromise. First of all, while its mandatory extension of scope to graduates of the ‘University of Life’ will be limited to the computing industry, Member States will still have the option to extend it to other non-graduates with sufficient equivalent experience if they wish. Secondly, its extension to refugees and persons with subsidiary protection could be particularly useful to those who are highly qualified.

Thirdly, although parallel national schemes will still exist, their comparative attraction as compared to the Blue Card system will be reduced, since they will be unable to provide more favourable terms than the Blue Card law in many respects. Conversely, it will still be possible for Member States’ systems to compete with the Blue Card as regards substantive terms of admission, although even on this front the liberalisation of the Blue Card admission rules (extension of scope, shorter minimum contract term, labour market preference test, longer minimum validity, salary thresholds) may mean that the gap between national and Blue Card systems is reduced. And, of course, the Blue Card system offers the benefit of mobility between Member States (itself improved by this Directive), which national schemes cannot.

However, note that Member States can still offer more favourable terms for those applying to national schemes for highly qualified workers as regards access to national systems of long-term residence (which can also continue to exist in parallel to the EU LTR system, according to the LTR Directive). On this point, the rejection of the Commission’s proposal to cut the waiting period for EU LTR status for Blue Card holders is significant, because it means that it is easier for national schemes to attract highly qualified workers by remaining more generous on this issue. The substance of national LTR status might be more generous too (more equal treatment than EU law on EU LTR status requires, for instance). The negotiators of the revised Blue Card law may have missed an opportunity to address this issue by also simplifying transfer between the parallel national and EU systems, or  by adopting rules on holding both national and EU status at the same time.

A proposal to amend the EU LTR law is due later this year, and possibly the revised Blue Card rules on the relationship between parallel national and EU systems could be a template for dealing with that issue as regards LTR status too. Again, a simplified transfer between national and EU systems, or rules on holding both EU and national status simultaneously, ought to be worth considering.

There is a risk that the rules on equality between EU and national schemes results in levelling down – i.e. Member States simply removing more favourable features of national systems, resulting in the EU/national systems as a whole being less attractive to non-EU citizens, thus conflicting with the objective of the Directive of encouraging more highly qualified migration. On the other hand, the new Directive could have the reverse effect: Member States particularly keen to attract highly qualified workers may improve national rules in areas where equal treatment is not required (for instance, salary thresholds or long-term residence status), resulting indirectly in supporting the new law’s objectives.

Fourthly, as regards admission rules, the reduction in the length of required contract may have a positive effect in achieving the new law’s objectives. On the salary threshold though, there may in practice be no change: since most Member States apply the 1.5 x average salary threshold already, they are not required to change it to meet the new law’s requirement of a threshold between 1 and 1.6 times national average salary. (The Commission proposal of 1 to 1.4 times national average would, on the other hand, necessarily have compelled every Member State to reduce their threshold). Nor will there necessarily be a change regarding the reduction in the salary threshold for shortage occupations and recent graduates – given that these reductions are optional. As noted already, Member States which are particularly keen to retain national schemes for admission of highly qualified workers may wish to retain a gap between the salary thresholds in EU and national schemes – in which case, they may be reluctant to use the opportunity to reduce the salary threshold for the Blue Card scheme, or to use the relevant optional derogations to reduce the threshold for some groups of workers. Again, though, they may choose rather to reduce the salary threshold for national schemes to retain their comparative attractiveness – thus attracting more highly qualified workers overall, albeit not as Blue Card holders.

Next, the continuation of labour market tests at entry and during the first year may still limit the numbers coming, although the new law definitely liberalises labour market access compared to the 2009 Directive (not much so as regards self-employment though). Allowing applications in-country for all Member States will have a modest effect, since most allowed it anyway. Similarly, few Member States banned applications for renewal; and it is arguable that the rules in the new Directive on renewal, judicial remedies and fees simply confirm the correct interpretation of the existing Directive.

Simplified rules on admission of family members, and their access to employment, may encourage applications from those with family members, particularly those whose spouses wish to work. While the changes on LTR status are modest, and do not affect parallel national rules on LTR status which may be more decisive in influencing applicants, they will be useful for those who have held (or still hold) another status.

It remains to be seen whether the new law achieves its desired objectives. So far, the admission of highly qualified migrants has not been enough to cause a brain drain in non-EU countries, or to contribute much towards the demographic issues the Commission is concerned about. Even the most paranoid ‘Great Replacement’ folks should find it hard to panic about increases of less than one ten-thousandth of the EU population.

It seems likely that the revised law will increase the number of Blue Card holders, as all the amendments push in that direction; none of them make Blue Cards less attractive or harder to get. The departure of the UK from the EU might increase the number of Blue Card applications even if the law had not been amended (although the numbers of UK citizens moving to the EU may nevertheless fall as compared to when free movement applied). Having said that, the new law only indirectly impacts national schemes for admission of highly qualified workers, which (for the reasons discussed above) might still be able to flourish. Also, the impact of a change in migration law can never cancel out other factors influencing migration flows – which include the response of competing non-EU countries (which might respond to any increased appeal of the Blue Card by making their own schemes more attractive), changes in the EU economy (as well as the economies of competing destinations, and source countries), and changes in the educational attainments of EU residents. And even if the numbers of highly qualified migrants coming to the EU (under either EU or national schemes) don’t increase much or even decline, they might nevertheless be higher as a result of the new law than they would have been without it.

Steve Peers

This article was originally published on EU Law Analysis.

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Image: Bart Everson, CC BY 2.0