Prime minister Theresa May has announced that EU nationals resident in the UK for more than five years will be offered residency, subject to reciprocity from the EU.
The proposals, part of what May called a "fair and serious" offer, would allow them rights to stay and access health, education and other benefits.
The government also aims to build up a new "UK settled status" for those with shorter residency, along with other assurances for EU nationals working in the UK.
The announcement came as May addressed other EU leaders in Brussels at her first EU summit since the general election.
The government has not yet specified what the cut-off date will be for new residents, after which the guarantee would no longer apply, but it will be no earlier than March 2017, when the UK formally began leaving the EU by issuing the Article 50 notification, and no later than March 2019 when it will actually leave.
The Association of Licensed Multiple Retailers (ALMR) welcomed May's statement, despite the fact that much detail is yet to emerge, including which legal jurisdiction would wield authority and what date will be used to measure current residency.
Chief executive Kate Nicholls said: "The prime minister's statement is a welcome indication that the government recognises the value of EU workers to the UK economy, and that a sensible solution will prevail. This has the makings of an insightful and pragmatic step to safeguard the rights of EU workers' rights and, in turn, economic growth.
"The eating and drinking out sector relies on migrant workers, particularly those from the EU, and the uncertainty that has surrounded the security of their status has been unhelpful. A KPMG report in March found that without EU workers hospitality would face a recruitment shortfall of around 60,000 workers per year. That is without taking into account projected employment growth of 200,000 - those numbers could not possibly be met by UK workers alone.
"Around 180,000 workers in eating and drinking out businesses are EU nationals. This is a huge part of a workforce that plays a significant role in the UK's economy.
"The plans outlined by Theresa May - albeit with many questions remaining - represent a positive signal for hospitality businesses and workers alike. For a sector that is such a driving force and significant contributor to the UK's wider economy, the benefits of an outcome that balances domestic employment needs with retained rights for EU workers would be wide-reaching."
Videos from The Caterer archives