A temporary cap on the number of skilled workers from outside the EU allowed into the UK was introduced “unlawfully”, the High Court has ruled.
Home Secretary Theresa May introduced the cap this summer as an interim measure ahead of a permanent cap.
But a legal challenge to it was upheld with judges ruling that ministers had “sidestepped” Parliamentary scrutiny.
The Home Office said it was likely to appeal and the verdict did not threaten its flagship immigration policy.
Officials insisted it would not apply to the permanent cap due to come into force in April.
Prime Minister David Cameron has called for net migration to be reduced from its current level close to 200,000 a year to “tens of thousands”.
Curbing numbers
As a first step, ministers introduced a temporary cap for non-EU skilled workers of 24,100 a month in June, in line with a Conservative election commitment.
But the measure was challenged by the Joint Council for the Welfare of Immigrants (JCWI) and English Community Care Association, which was concerned over the position of immigrant care workers.
In Friday’s ruling, Lord Justice Sullivan and Mr Justice Burton concluded that the home secretary had not gone through the proper parliamentary procedures before implementing the cap.
As a result, it said no lawful limits were now in place for two tiers of job applicants from abroad.
The English Community Care Association said the temporary cap – which reduced by 5% the number of non-EU work visas issued – could have a potentially “catastrophic” effect on the care sector.
As 13% of those who work in care homes come from outside Europe, it said thousands of staff from the Philippines, India and South Africa could be forced to quit their jobs and this could damage continuity of care.
‘Disregard’
Vacancies created would not be filled by British staff, it said, as there was not sufficient demand for the jobs.
It argued the cap had been introduced with “complete disregard” for care providers and their staffing needs.
A Home Office spokesman said the ruling only applied to the interim cap, which was introduced to prevent a rush of immigration applications before the new cap came into force.
The BBC’s Political Correspondent Carole Walker said officials strongly rejected the suggestion that the entire policy was in doubt, saying the ruling was on a point of process not a point of principle.
The level at which the permanent cap will be set has been a source of tension within government, with Lib Dem ministers calling for the regime to be flexible as possible so as not to prevent firms from being able to recruit highly skilled labour.
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