Expert legal advice for licensed sponsors on reporting, record keeping, right to work checks, sponsored worker monitoring, Certificates of Sponsorship, SMS compliance, Home Office audits and avoiding suspension or revocation.
Obtaining a sponsor licence is only the beginning of an employer’s responsibilities.
Once a business becomes a licensed sponsor, it enters an ongoing compliance relationship with the Home Office and must continue to meet a wide range of duties throughout the life of the licence.
These obligations include:
The current Home Office sponsor guidance confirms that licensed sponsors are subject to reporting and record-keeping duties and must comply with immigration law, wider UK law and the wider sponsorship framework. UKVI can take enforcement action where it reasonably suspects non-compliance.
At Knights & Shah Solicitors, we advise employers on maintaining sponsor compliance, preparing for Home Office audits, correcting compliance weaknesses and responding where UKVI raises concerns.
Sponsor licence compliance means continuously meeting the obligations that come with holding a Home Office sponsor licence.
The sponsor system relies heavily on employers to assist UKVI in monitoring sponsored workers and ensuring that sponsorship is being used properly.
A sponsor is therefore expected to maintain effective systems capable of identifying and reporting relevant changes.
The Home Office can continually monitor a sponsor’s ability and willingness to comply, including through compliance checks and HMRC information.
Compliance should therefore be treated as an ongoing corporate governance and HR responsibility, not merely something considered when a worker first receives their visa.
The current sponsor guidance identifies several core categories of responsibility.
These include:
Sponsors must report specified changes involving sponsored workers and the organisation.
Sponsors must retain prescribed records and documents concerning sponsored workers and provide them to UKVI when requested.
The sponsor must comply with immigration law and the requirements of the Worker and Temporary Worker sponsor guidance.
Sponsors must comply with relevant UK law more generally.
Sponsors must not engage in behaviour or activity considered contrary to the public good.
A failure in any of these areas can potentially lead to compliance action.
A sponsor’s responsibility for an individual worker generally begins when the sponsor assigns the worker a Certificate of Sponsorship.
The duty continues until one of the events specified by the Home Office occurs, such as the worker’s permission expiring, the sponsor withdrawing sponsorship or sponsorship otherwise ending.
Special provisions apply to certain routes, including Scale-up Workers, where ordinary sponsorship responsibility ends after the initial six-month sponsored period.
Employers should therefore not assume that sponsor duties begin only when the worker physically starts work.
A licensed sponsor must report specified changes concerning its sponsored workers.
Depending upon the circumstances, reportable events can include matters such as:
The Home Office expressly requires sponsors to report situations such as a sponsored worker failing to start employment or being absent without permission for a significant period.
The precise reporting obligation and deadline should be checked against the circumstances.
Sponsor duties also apply to changes affecting the business itself.
Depending upon the nature of the change, an organisation may need to report matters such as:
Corporate transactions can have particularly serious sponsorship consequences.
A merger or takeover may not simply be a routine SMS update. Depending upon the circumstances, a new sponsor licence or other action may be required.
Immigration compliance should therefore form part of due diligence where sponsored workers are involved.
The Sponsorship Management System, or SMS, is the principal online system used by sponsor licence holders to manage sponsorship.
The SMS can be used to:
Errors in SMS management can create significant compliance problems.
Common issues include:
Businesses should have clear internal responsibility for SMS management rather than relying on ad hoc administration.
Licensed sponsors must keep specified documents for each sponsored worker.
The Home Office’s Appendix D sets out the records that must be retained and the applicable retention requirements. Records can generally be stored in paper or electronic form, provided the required information remains visible and accessible.
Depending upon the worker and route, required records can include evidence relating to:
Sponsors should be capable of producing relevant documentation promptly if UKVI requests it.
Carrying out appropriate right to work checks is a fundamental part of sponsor compliance.
The Home Office requires sponsors to retain evidence of the sponsored worker’s right to work.
Sponsors should have procedures covering:
The current sponsor guidance warns that failure to carry out required right to work checks can constitute a breach of sponsor duties and may also expose the employer to a civil penalty. Serious failures can lead to sponsor licence revocation.
Right to work compliance should therefore be integrated into normal recruitment procedures for all employees, not just sponsored workers.
Sponsors must monitor workers they sponsor.
This includes ensuring that sponsored workers actually undertake the role for which sponsorship was granted.
The Home Office expects sponsors to monitor matters such as:
Sponsors must also tell UKVI where a worker does not start employment, is absent without permission or where significant employment changes occur.
This is why reliable HR systems are central to sponsor compliance.
A sponsor should have a system capable of identifying when a sponsored worker is absent from work.
The system should allow the organisation to distinguish between:
Where an absence triggers a reporting requirement, it must be dealt with correctly through the sponsorship system.
A business should therefore avoid relying solely on informal communications between managers and HR.
Sponsors must keep required information concerning sponsored workers, including current contact details.
Internal systems should enable the business to maintain accurate information concerning matters such as:
The Home Office specifically identifies current contact details as one of the records sponsors are expected to maintain.
Employees should be told how and when to notify HR when their details change.
A sponsored worker must genuinely perform the role for which they have been sponsored.
A sponsor should therefore ensure that:
The Home Office requires sponsors to check that workers undertake the role for which they were sponsored.
Promotions, transfers and major changes in duties should therefore be reviewed from an immigration perspective before implementation.
Salary can be a particularly sensitive sponsorship issue.
A reduction or other material change in salary may need to be reported and can affect whether the sponsored worker continues to satisfy the immigration requirements.
Employers should be particularly careful with:
The worker’s current salary should remain consistent with the relevant immigration and sponsorship rules.
A sponsored worker moving into a substantially different role can create immigration consequences even where the employer remains unchanged.
Questions can include:
HR and management teams should therefore consult immigration compliance processes before implementing material role changes.
A Certificate of Sponsorship (CoS) should only be assigned where the sponsorship requirements are genuinely satisfied.
Before assigning a CoS, sponsors should check matters including:
Sponsors must also keep relevant records concerning recruitment activity, even where there is no formal resident labour market test requirement.
Incorrect or careless CoS assignment can affect both the worker’s visa and the sponsor licence.
The individuals responsible for managing the sponsor licence remain important after the licence is granted.
Sponsors should ensure that:
Access to the Sponsorship Management System should be carefully controlled.
A business should ideally have sufficient internal knowledge so that sponsor compliance does not depend entirely on one individual.
Sponsor licence compliance is not limited to immigration law.
Licensed sponsors must also comply with wider UK law.
Depending upon the organisation, this can include legal obligations concerning:
An immigration-compliant job can still create sponsorship difficulties if the employment itself is unlawful.
Sponsored roles should be genuine.
Sponsors should avoid creating roles principally to facilitate immigration permission or describing a job in a way designed to fit an eligible occupation where the employee will actually perform different duties.
UKVI may examine:
The business should be able to explain why the role genuinely exists and how it fits within the organisation.
A Sponsor Licence Compliance Audit is a proactive review of the organisation’s sponsorship systems and worker records.
The purpose is to identify weaknesses before they result in Home Office action.
An audit can examine areas such as:
A compliance audit can be particularly valuable where an organisation has grown rapidly or has not reviewed its sponsorship procedures for some time.
An audit can be useful at any stage, but particularly:
Regular reviews can help prevent small administrative problems developing into systemic breaches.
UKVI can carry out compliance checks on licensed sponsors.
These may occur:
The Home Office sponsor guidance contains detailed provisions governing compliance checks and the sanctions available where deficiencies are found.
A compliance visit can examine both documentation and how the business actually operates.
Depending upon the circumstances, UKVI officers may examine:
Officers may also interview:
Written policies should therefore reflect actual practice.
The Home Office has a range of enforcement options.
These can include:
The sanction depends upon the nature and seriousness of the alleged breach.
An A-rated sponsor can potentially be downgraded where UKVI identifies compliance weaknesses.
A downgraded sponsor may be required to follow an action plan and correct specified problems.
Restrictions can also be imposed on sponsorship activity.
For businesses reliant on international recruitment, a downgrade can therefore create operational consequences even if the licence has not been suspended or revoked.
The Home Office may suspend a licence while investigating suspected breaches.
Suspension should be treated as urgent.
The organisation may be given an opportunity to respond to the Home Office allegations.
A strong response should generally:
Poorly prepared responses can increase the risk of revocation.
Revocation is one of the most serious sponsorship sanctions.
If the licence is revoked, the organisation loses its authority to sponsor workers under the affected routes.
Revocation can affect:
The Home Office guidance contains circumstances in which a licence will, normally will, or may be revoked depending upon the breach.
Prevention through effective compliance is therefore significantly preferable to dealing with revocation after the event.
Sponsor licence holders also remain subject to the wider illegal-working regime.
Failure to carry out appropriate right to work checks can lead to:
The sponsor guidance states that failure to undertake required right to work checks can result in both civil penalty exposure and sponsor licence action.
Sponsor compliance and right to work compliance should therefore be managed together.
The precise requirements are contained in Appendix D and vary according to the worker and route.
A compliant sponsor file can potentially include records relating to:
The Home Office can request relevant documents to assess sponsor compliance and expects sponsors to provide them within the specified timeframe.
A sponsor should regularly ask:
Checks should be completed using the appropriate process and evidence retained.
Required documents should be available and up to date.
Sponsored workers should notify the organisation of changes.
HR should be able to identify unauthorised absence.
The business should know when immigration permission expires.
Their duties should remain consistent with the sponsored job.
Salary and working arrangements should continue to satisfy relevant immigration requirements.
Reportable worker and organisational changes should be dealt with correctly.
Users, worker information and licence details should remain current.
Sponsor-management roles should be kept under review.
The business should be able to demonstrate compliance without needing several weeks to reconstruct records.
Problems frequently arise through:
The sponsor itself remains responsible for complying with the sponsorship regime.
At Knights & Shah Solicitors, we advise employers on maintaining and protecting their sponsor licence.
We can assist with:
Our aim is to help organisations identify sponsorship risk before it becomes Home Office enforcement action.
If you require advice contact Knights & Shah Solicitors.
We provide clear, solicitor led advice, strategic case planning and robust court representation to protect our clients.
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