Shabana Mahmood rowed back on her most hardline plans to make care workers wait 15 years for settlement in the UK, but told MPs on Monday that many migrants would still face retrospective rule changes to make them wait a decade.

Under pressure from a cabinet backlash and health unions, the home secretary has offered a carve-out for care workers to allow them to apply for indefinite leave to remain after five years.

But most of the rigorous new rules drawn up by Mahmood’s office last year remain, including plans to force those who arrived in the UK by irregular means such as small boats to face up to 30 years before being able to apply for settlement.

The changes drew cries of betrayal from the Conservatives and the Reform UK leader, Nigel Farage, who said it was “the beginning of the capitulation”.

But Mahmood told the Commons she would still enact sweeping changes that will mean many migrant workers will wait double the time they had expected for settlement.

She said settlement was “one of most valuable rights this country can offer. Until now it has been given almost automatically. From today it must be earned. Those who contribute will settle fastest. Those who don’t play by the rules will be refused or wait much longer.”

In particular, the wait for those earning under £50,000 will double to 10 years. This was criticised by some Labour MPs who said vital workers such as research scientists and chefs would be caught by the changes.

The Law Society said the changing rules could threaten the rule of law, saying it “retrospectively undermines the legal certainty that individuals, families and employers rely on”.

Some MPs suggested they would continue to press the home secretary to rethink the retrospective nature of the changes – though the new policies do not require a vote in parliament, so MPs have limited means to block them.

Abtisam Mohamed, the Labour MP for Sheffield Central, said: “Retrospectively uprooting someone’s plans, sometimes made at the most vulnerable time in their lives, is unfair. I’ll be pressing for those already here to be protected.”

The former shadow home secretary Diane Abbott also criticised the retrospective changes. “You can come in legally, you can work legally and then have your residency rights turned upside down,” she said, warning of another potential Windrush scandal.

The Walthamstow MP Stella Creasy said there was a “partial recognition” of the contribution migrants made but there were thousands of people “facing 10 years of limbo with many businesses unclear if talent will stay or not as a result”.

She said: “The economic consequences of those people walking away from the UK will far outweigh any savings in entitlement to benefits, given many of them don’t claim anyway, so the home secretary still has work to do to make these reforms work for our national interest.”

Refugees will also face a longer wait of 10 years, with an additional 10-year penalty for those who do not enter legally – and those who do not find employment will face a wait of up to 30 years.

Andy Burnham, who promised voters in his Makerfield byelection that he would support Mahmood’s migration agenda, endorsed the plans and said the home secretary was “gripping this problem” by introducing the earned element.

“People want to see an immigration system based on control, contribution, and which rewards those who play by the rules,” the prime minister said. “It is only fair that those who are making the most valuable contribution to our communities are given the opportunity to settle earlier. Those in other roles should expect to wait longer while people who abuse the system or arrive illegally will be refused or will also have to wait longer.”

But migrant rights organisations accused the government of “moving the goalposts” for those who had played by the rules. “People who have built their lives around the government’s requirements deserve better than decisions that turn their own and their families’ lives upside down,” said Amnesty International.

The key climbdown from the home secretary was an exemption for care workers – something which the housing secretary, Angela Rayner, had explicitly criticised. The energy secretary, Miatta Fahnbulleh, also repeatedly refused to say she backed proposals to prolong the qualifying period for settlement.

Under pressure from health unions to make an exception for care workers, the home secretary has moved to allow an estimated 280,000 care workers and their dependents to apply for indefinite leave to remain after five years.

In the revised set of proposals, care workers earning more than £25,000 will be able to apply for indefinite leave to remain after five years, a third of the time that was announced last year.

Home Office officials calculate that about 500,000 migrants will have to wait longer than the current five years. But critics of Mahmood’s softening point out that 1.4 million out of the 1.9 million migrants who came to Britain under the so-called “Boriswave” surge in legal migrants will still be eligible for indefinite leave after five years.

Highest earners – those earning more than £125,000 – will be able to settle within three years. Those earning more than £50,271 and some public service workers such as doctors, nurses and teachers will be able to settle after five years.

The exception will be the small number of refugees who enter through designated safe and legal routes such as the reopening of the scheme for Afghan women and girls and Palestinians. No other refugees will be eligible for settlement if they have accessed any public funds.

Mahmood met union general secretaries to map out the changes on Monday morning, before presenting them to MPs. The Unison general secretary, Andrea Egan, said it was welcome that Mahmood had not implemented her original plans, which were “morally bankrupt and a threat to public services”.

Egan said the obligations placed on care workers to qualify for the five-year path were still onerous. “The government must make sure it isn’t unjustly denied to them. Thousands of migrant care workers have had their employment patterns and pay disrupted by rogue employers,” she said. “The power of employers to threaten workers with deportation or disrupt their route to settlement must end.”

Business groups warned that the retrospective nature of the changes would still cause far-reaching damage in some sectors. The CBI said the exemption for some care workers meant the policy risked “being higher costs for the relatively small number of businesses using skilled worker visas, without addressing the problem the policy was originally designed to solve”.

Make UK said it would make it far more difficult for businesses to retain skilled workers and industries would “undoubtedly lose talent to countries that welcome skilled workers rather than moving the goalposts”.

The shadow home secretary, Chris Philp, said Mahmood’s decision to allow a carve-out for care workers who arrived on the visa before May 2025 would cost the country up to £10bn, a figure Mahmood has cited in support of her original plans. The home secretary said the longer wait for settlement for more than half a million people would mean a cut to the projected benefits bill.

Other Conservative MPs acknowledged that it was the previous government who had allowed numbers to rise so significantly. The backbencher Edward Leigh said to Philp that “anybody who was serving as a Home Office minister at that time should wear sackcloth and ashes”.