Sponsor Licence

Sponsorship Licence Overview

Sponsoring overseas nationals offers UK businesses a valuable opportunity to fill essential skills gaps with talented migrant workers. However, obtaining a sponsor licence is a detailed and regulated process, and organisations must meet specific requirements and responsibilities to maintain compliance.

What is a Sponsorship Licence?

UK employers must secure a sponsor licence from the Home Office before employing non-UK residents under visa routes such as the Skilled Worker Visa, Scale-up Visa, or Global Business Mobility routes. Without a valid licence, employers cannot sponsor migrant workers. The licence requires employers to adhere to immigration duties, with systems in place to monitor compliance and maintain records.

Sponsorship Licence Types

There are two main types of sponsor licences:

1. Worker Sponsor Licence: Allows employers to hire overseas nationals for both short-term and permanent skilled roles, including under routes like the Skilled Worker, Senior or Specialist Worker, and International Sportsperson routes.
2. Temporary Worker Sponsor Licence: For temporary employment opportunities, covering routes such as the Scale-up Worker, Creative Worker, and Charity Worker.

Licence Compliance and Penalties

Holders of sponsor licences are subject to potential Home Office inspections, and any breaches of compliance can result in licence downgrades, suspensions, or revocations. This may affect an employer’s ability to hire migrant workers and the visa status of their existing sponsored employees.

Visa Routes Requiring a Sponsorship Licence

Most UK work visas, such as the Skilled Worker and Minister of Religion routes, require sponsorship. Exceptions include the Graduate Visa and High Potential Individual (HPI) Visa, which do not require sponsorship and offer temporary work rights without the need for an employer’s licence.

Licence Application Process

To apply for a licence, businesses must demonstrate lawful operations in the UK, alongside the ability to meet visa sponsorship duties. Applications must include supporting documentation, with the Home Office conducting background checks and, in some cases, a compliance visit. Sponsorship licences are typically processed within eight weeks, with an expedited service available for a fee.

Costs and Fees

The cost of obtaining a sponsor licence depends on the size and type of the business. Small and charitable organisations pay £536 for a licence, while medium and large businesses pay £1,476. Additional fees apply for assigning Certificates of Sponsorship and the Immigration Skills Charge, which varies by business size.

Ongoing Licence Management

Once granted, a sponsor licence comes with ongoing compliance duties, including record keeping and reporting any changes via the Sponsorship Management System (SMS). Non-compliance can result in penalties or loss of the licence.

Expert Assistance

Axis Solicitors can provide comprehensive support at every stage of the sponsorship licence process. From initial application advice and compliance training to handling renewals and licence management, our team is here to ensure you navigate the complexities of the system with confidence.

For assistance with your sponsor licence application, management, or compliance, contact Axis Solicitors today.

Eligibility & Requirements

To apply for a sponsor licence, your business must meet the following eligibility criteria and requirements:

Eligibility Criteria:

• Your business must be lawfully operating and trading within the UK.
• You must have robust HR systems in place to effectively manage your employees, including maintaining accurate records to demonstrate compliance with sponsor duties.
• Your previous sponsor licence must not have been revoked within the last 12 months.
• You, or any key personnel involved in the sponsor licence application, must not have any unspent criminal convictions, including those related to immigration offences, fraud, or money laundering.

Compliance Requirements:

• Businesses are required to comply with right-to-work regulations, ensuring that all employees have the legal right to work in the UK, as part of the Home Office’s measures to prevent illegal employment.
• You must be prepared to fulfil all ongoing sponsor duties, including record-keeping and reporting obligations.

Processing Time:

• The Home Office typically processes sponsor licence applications within 8 weeks, although this may be extended if a pre-compliance visit is requested.

Priority Service:

• For a faster decision, the Home Office offers a priority processing service for an additional £500. If accepted, your application will be processed within 10 working days.

Supporting Documents

The supporting documents you need to provide when applying for a sponsor licence will depend on the nature of your business, the type of licence you are applying for, and the immigration routes involved.

Document Requirements:

Organisations applying for a sponsor licence under the Worker, Temporary Worker, or other routes must refer to Appendix A of the Home Office guidance, which outlines the specific documentation required.

Typically, businesses are required to submit at least four key documents from this list to demonstrate they are genuine and operating lawfully in the UK. However, the exact number and type of documents can vary based on factors such as:

• The size and type of the organisation
• How long the business has been trading
• The specific sponsor licence route being applied for (e.g., Worker or Temporary Worker)

Providing accurate and comprehensive supporting documentation is critical, as failure to do so can result in delays, rejections, or additional costs.

Examples of Supporting Documents:

Some examples of the types of documents that may be required include:

• Evidence of your business registration, such as a Certificate of Incorporation or HMRC registration
• Proof of current business bank account
• Employer’s liability insurance certificate
• Evidence of premises, such as lease agreements or ownership documents
• Audited accounts or annual reports

Additional Considerations:

In some cases, businesses may need to apply for multiple subcategory worker licences, depending on the type of employment roles they wish to fill. Our team can assist you in identifying the appropriate licences and ensuring all necessary documents are submitted.

How We Can Help:

Our team of legal experts can guide you through the entire application process, providing a tailored checklist of required documents based on your specific business needs. We work with you to ensure that your application is supported by robust and credible evidence, increasing the likelihood of approval.

For expert advice on sponsor licence applications or to explore our comprehensive sponsorship services, call us at 0333 016 5270 or email us at contact@axis.lawyer.

Costs to Apply

The cost of applying for a UK sponsor licence depends on the size and type of your organisation, as well as the licence type being sought. Organisations are categorised as either small/charitable or medium/large businesses.

Sponsor Licence Application Fees:

• Medium or Large Businesses: The application fee for medium and large businesses is £1,476.
• Small Businesses and Charities: Small businesses and registered charities, defined as having an annual turnover of £10.2 million or less, fewer than 50 employees, or assets worth less than £5.1 million, pay a reduced fee of £536.

Adding Subcategories:

• Small Businesses or Charities: If adding a Temporary Worker subcategory to an existing Worker sponsor licence, no additional fee is required.
• Medium or Large Businesses: Adding a Temporary Worker subcategory requires a fee of £940.

Additional Costs:

In addition to the application fee, there are further costs associated with holding a sponsor licence:

• Certificate of Sponsorship (CoS) Assignment Fee: £239 for each worker you sponsor under most routes.
• Immigration Skills Charge (ISC):
  • Medium/Large Sponsors: £1,000 for the first 12 months, plus £500 for every additional 6 months.
  • Small Businesses/Charities: £364 for the first 12 months, plus £182 for every additional 6 months.

Sponsor Licence Holder Obligations

As a sponsor licence holder, you are responsible for fulfilling several important obligations to maintain your licence and avoid penalties or compliance action from the Home Office. These obligations include:

1. Record Keeping

You must maintain accurate and up-to-date records of all your sponsored employees. This includes keeping copies of key documents such as:

• Passport pages showing personal identity details and immigration status.
• Biometric Residence Permits.
• Contact details, National Insurance numbers, and employment contracts.
• Records of any absences and updated contact information.

2. Reporting

Certain events or changes must be reported to the Home Office via the Sponsorship Management System (SMS) within specific timeframes, such as:

• If a sponsored worker does not turn up for their first day of work.
• Early termination of a sponsored worker’s contract.
• A sponsored worker being absent from work for more than 10 days without permission.
• Changes to the organisation, such as insolvency, a change of business address, or key personnel changes. These must be reported within 20 working days.

3. Compliance with Immigration Laws

Sponsor licence holders must comply with UK immigration laws and ensure adherence to all parts of the Worker and Temporary Worker sponsor guidance. This includes fulfilling your duties in relation to right-to-work checks, ensuring you only employ workers legally allowed to work in the UK.

4. Complying with Wider UK Law

Beyond immigration law, you must also comply with wider UK laws related to employment and business operations, ensuring all sponsored workers are employed under legal, fair, and safe conditions.

5. Good Behaviour

As a licence holder, you are expected to uphold good character. Engaging in behaviour that is deemed not conducive to the public good, such as fraud, money laundering, or other criminal activities, could result in the suspension or revocation of your sponsor licence.

6. Home Office Investigations

The Home Office can investigate your compliance with these obligations at any time. If breaches of compliance are found, the Home Office has the power to downgrade, suspend, or revoke your sponsor licence, impacting both your ability to hire migrant workers and the immigration status of any workers you sponsor.

How to Apply

If your business meets the eligibility criteria to apply for a sponsor licence, you can submit your application online via the Home Office portal. However, before applying, your business must ensure it is operating lawfully in the UK, has effective HR and recruitment systems in place, and is capable of complying with ongoing sponsorship duties.

Steps to Apply:

1. Prepare Your Documentation: As part of the application, you will need to provide supporting documents to demonstrate that your business is genuine and can fulfil its sponsorship duties. These documents will vary based on the nature and size of your organisation but typically include proof of business registration, financial records, and evidence of premises.

2. Submit an Online Application: Complete the online sponsor licence application form and provide all required supporting documents within five days of submission.

3. Pay the Application Fee: Depending on the size of your organisation, you will need to pay either £1,476 for medium/large businesses or £536 for small businesses and registered charities.

4. Prepare for a Compliance Visit: The Home Office may conduct a compliance visit to assess your HR systems and ensure you can fulfil your duties as a sponsor.

Given the complexity of the sponsor licence application process, including the documentation requirements and compliance obligations, it is advisable to seek legal guidance to ensure your application is successful. Errors or incomplete submissions can lead to delays, rejections, or further costs.

How We Can Help:

Our team of experienced immigration solicitors frequently assists businesses in acquiring sponsor licences to hire skilled workers from overseas. Whether you are applying for your first licence or need help managing your compliance duties, we can guide you through each step of the process to ensure a successful outcome.

Required Skill Level

To qualify for a Skilled Worker visa, the job being offered to the migrant worker must meet a minimum skill level of Regulated Qualifications Framework (RQF) Level 3, which is equivalent to A-levels in the UK. This allows employers to sponsor workers for roles that require a more varied range of skills, broadening the pool of talent available to UK businesses.

Skill Level Evolution

In the past, jobs had to meet a higher skill requirement of RQF Level 6, which is equivalent to a Bachelor’s degree or higher. This stricter requirement meant only highly skilled, degree-level jobs could be sponsored under the work visa route. However, changes to the immigration rules were made to address the labour shortages across different sectors, enabling employers to recruit for roles that require lower, but still specialised, skill levels.

This change to RQF Level 3 reflects the UK’s need to fill critical skill shortages across various industries. It now allows jobs that require technical knowledge, such as those in skilled trades, healthcare, IT support, and other industries, to be sponsored under the Skilled Worker visa route.

Specific Skill and Salary Requirements

The job not only needs to meet the skill level but must also comply with the relevant salary thresholds for the visa route. For most skilled workers, the general salary threshold is £26,200 per year, or the “going rate” for the specific job, whichever is higher. However, there are certain exemptions, such as roles in health or education sectors, which may have different salary thresholds.

Employers are responsible for ensuring that the role they are offering to a migrant worker meets both the skill level and salary criteria specified by the Home Office. Failure to meet these requirements can result in visa refusals, affecting both the business and the potential employee.

Job Categories and Shortage Occupation List

Some job roles that meet the RQF Level 3 requirement are also listed on the Shortage Occupation List, which allows employers to benefit from a reduced salary threshold. For example, roles in healthcare, engineering, and IT are commonly listed, reflecting the high demand for skilled professionals in these fields.

Positions on the Shortage Occupation List also provide employers with flexibility in recruiting overseas talent to fill gaps that are difficult to fill domestically. In these cases, the salary threshold may be reduced to £20,960 or 80% of the job’s usual “going rate,” making it easier to sponsor workers in essential sectors.

Salary Requirements

The salary requirements for sponsoring a worker under the Skilled Worker visa route have changed significantly from April 2024. The specific thresholds depend on whether the worker is classified as a new entrant or an experienced worker, as well as the type of job being offered.

General Salary Thresholds:

• Experienced Workers: The minimum salary for experienced workers has increased from £26,200 to £38,700 per year or the going rate for the job, whichever is higher.

• New Entrants: A lower salary threshold applies to new entrants (those under 26 years old or recent graduates). For new entrants, the salary threshold is £30,960, which is 70% of the going rate for the role.

Going Rate and Role-Specific Salary Requirements:

• Each job role has a specific going rate based on its Standard Occupational Classification (SOC) code. The going rate now reflects the 50th percentile of wages for each role, making it crucial for employers to ensure that the salary offered meets or exceeds this rate.

• For certain roles, particularly those on the Immigration Salary List (formerly the Shortage Occupation List), a reduced salary threshold of £30,960 or 80% of the going rate may apply.

Exceptions for Specific Roles:

• Healthcare and Education Sectors: Some roles in healthcare and education may have different salary thresholds, depending on the job’s classification and the level of shortage in the sector.

• PhD-Level Roles: For workers with a relevant PhD, the minimum salary can be reduced, provided the role aligns with the worker’s qualifications.

Application Timing:

• These new thresholds apply to any Certificate of Sponsorship (CoS) issued after 4 April 2024. If the CoS was issued before this date, the old thresholds will continue to apply.

For employers sponsoring workers, it’s essential to stay updated on these salary changes, as failure to meet these thresholds can lead to visa rejections.