For EU citizens who wish to remain in the UK after June 2021, there is a cost of £65 per adult individual and £32.50 for individuals under 16.
UKH chief executive Kate Nicholls said abolishing the proposed cost would serve as a signal of goodwill towards hospitality staff from the EU and prevent a potential “bureaucratic nightmare”.
Other critics of the fee include the Mayor of London Sadiq Khan and the Scottish parliament.
Nicholls said EU staff were incredibly valued by the hospitality sector. “They have contributed significantly to the growth of the sector and the UK economy,” she said.
She continued: “Waiving the charge for settled status would be a fantastic gesture from Government to demonstrate that Britain is positive about those who choose to stay in this country.
“At a time of near-full employment in the country, any exodus of EU citizens could be highly damaging for business and the economy.”
The plea comes as the hospitality sector braces itself for the impact of the Government’s post-Brexit immigration policy and warnings that many businesses are dependent on EU staff to make up for difficulties recruiting at home.
Several pubcos explained they would cover the costs of their employees’ fees to The Morning Advertiser last week.
Young’s chief executive Patrick Dardis said the chain would “do whatever we need to do to continue making staff feel welcome”, joining Fuller’s and Oakman Inns in paying the fee and helping staff with paperwork.
However, many pub employees are unable to cover this charge on behalf of their employees, Nicholls said.
“Furthermore, where the employer does meet the expense, the Government is insisting that this is a taxable benefit, leading to an extra payment through income tax,” she added.
“It could also turn into a bureaucratic nightmare for Government, business and citizens.”
“It is also worth noting that EU citizens did not vote for Brexit, and most would not have expected a charge when they moved to make the UK their homes and their workplaces.”
Applications for settled status open today (21 January).