The following guide offers detailed insights into the requirements, application procedures, management and renewal of the UK sponsor licence. In the case of application refusal, we provide an analysis of possible causes and advice on enhancing future applications.
In the United Kingdom, companies and institutions aiming to hire workers from outside the European Economic Area under the Tier 2 and Tier 5 visa categories must secure a sponsor licence
Educational institutions, including universities, should secure this licence from the Home Office to recruit international students.
The need for a sponsor licence applies to unpaid roles as well, such as charity work. However, you do not need a licence to sponsor some groups, for example:
Sponsor licences are valid for four years, after which employers must reapply for an extension. Obtaining and maintaining a sponsor licence requires employers to commit to strict guidelines for compliance. The rules include the necessity for efficient and effective HR processes that align with the standards set by the Home Office.
Choosing the right sponsor licence in the UK depends on the employment type for foreign workers you intend to hire. There are two primary categories: ‘Workers’ for skilled, long-term or permanent roles, and ‘Temporary workers’ for specific, short-term positions. You can opt for a licence that covers either or both categories.
For ‘Worker’ licences, there are several subdivisions:
The ‘Temporary Worker’ licence, on the other hand, caters to temporary employment, including volunteering and job-shadowing, in specific sectors:
The Scale-up sponsor licence in the UK supports rapidly growing businesses by enabling them to recruit talented individuals from overseas. This licence is particularly relevant for businesses experiencing significant growth, allowing them to add skilled personnel essential for their expansion.
Definition of a Qualifying Scale-up Sponsor
There are two pathways to qualify as a Scale-up sponsor:
Who needs a Certificate of Sponsor (CoS) to work in the UK
The overseas workers, including those who came to the UK from the EU, Iceland, Liechtenstein, Norway, and Switzerland after 31st December 2020, need Certificates of Sponsorship (CoS). If the UK company possesses the sponsor licence, it may issue CoS to foreign workers residing inside or outside the UK so they can apply for a work visa, such as a Skilled Worker Visa.
Note that sponsoring a worker does not assure their visa approval for working in the UK.
A sponsor licence number is an exclusive identifier found on a Certificate of Sponsorship (CoS), which is necessary for overseas workers when they apply for a work visa. This electronic document details the job offer, specifying the job type and how long the employment will last.
Someone appointed in your organisation can request a CoS through the Sponsorship Management System (SMS). If the Home Office approves it, usually within a day, the CoS is then provided to the foreign worker as evidence of their job offer, enabling them to proceed with their work visa application.
The cost of a CoS ranges from £25 to £239, based on the licence type.
There are two kinds of CoS:
The UK Home Office sets strict requirements for companies to qualify for a sponsorship licence. Although there is no minimum or maximum size requirement for a company, the UK business still must meet the list of eligibility criteria for the licence category they chose to apply for. Failure to confirm the criteria will result in the rejection of a sponsorship licence from the Home Office.
For specific types of sponsor licences, like the UK Expansion Worker sponsorship, businesses are required to have a UK presence but not an active trading presence.
New startups can apply for a sponsor licence, but those operating for less than 18 months must provide additional evidence such as a corporate bank account with a UK bank registered with FCA and PRA.
You may not get a licence as an employer if you possess criminal convictions for immigration-related law breaches, fraud, and money laundering. You also will not be able to obtain the licence if you had your licence declared void in the past year.
To obtain a sponsor licence in the UK, your business must also demonstrate to the Home Office that the role offered to an international specialist is legitimate:
The business should comply with these criteria not just during the application but throughout the licence’s validity. Compliance officers may visit after the licence is granted to ensure ongoing adherence to sponsorship duties. Non-compliance or threats to immigration control can lead to the revocation of the licence.
Applicants for a UK Skilled Worker visa might also undergo additional verification if there are concerns about the job’s authenticity. The Home Office may ask the international worker for further proof within 28 days or to participate in a face-to-face interview. During this interview, the Home Office official will assess:
While such extensive checks are typically not routine, the UKVI pays particular attention to sectors deemed high-risk. These high-risk sectors are not explicitly defined in guidance for Home Office caseworkers.
When applying for a UK sponsorship licence, you must designate individuals within your organisation to oversee the sponsorship process effectively. These individuals will primarily use the Sponsorship Management System (SMS) to manage the licence.
The roles required include:
These roles can be filled by the same individual or by different members of your team. Additionally, after obtaining your licence, you have the option to appoint a Level 2 user, who has more limited access compared to a Level 1 user, such as being unable to withdraw a certificate of sponsorship.
To apply for a sponsorship licence, businesses and organisations must undertake the following process:
Appendix A of the Home Office lists potential documents that may be required, such as:
Public bodies or companies listed on the London Stock Exchange Main Market might need fewer than four documents.
Additional documents might include an organisation hierarchy chart, an employer’s liability insurance certificate, evidence of listing on various stock exchanges, and tax returns.
Fees vary based on the licence type and the organisation’s size, with specific amounts for different sponsor categories:
Licence Type and Fees:
Worker Licence:
Temporary Worker Licence:
Worker and Temporary Worker Licence:
Incorporate a Worker Licence into an Existing Temporary Worker Licence:
Incorporate a Temporary Worker Licence into an Existing Worker Licence:
Small sponsors typically meet two criteria: annual turnover of £10.2 million or less, total assets worth £5.1 million or less, or 50 or fewer employees. Charitable sponsors include registered charities across the UK and other charitable organisations. For clarification, businesses can contact the Business Helpdesk at businesshelpdesk@homeoffice.gov.uk.
Most applications receive a decision within eight weeks. For an additional £500, you may expect a decision within 10 working days, subject to availability and on a first-come, first-served basis. Instructions for requesting a faster decision are provided post-application.
In the UK, businesses seeking to sponsor employees receive either an A-rating or a B-rating for their sponsor licence. Initially, a new sponsor licence is A-rated, allowing the business to assign sponsorship certificates and appear on the register of sponsors. However, if an authorising officer is based outside the UK, companies applying to sponsor a UK Expansion Worker receive a provisional rating. This limits them to one sponsorship certificate, assigned to the authorising officer for their UK entry. Upon the officer’s visa approval, the business can upgrade to an A-rating and request additional certificates through the sponsorship management system (SMS).
If a business fails to uphold its sponsor responsibilities, its A-rated licence may be downgraded to a B-rating. This prevents the issuance of new sponsorship certificates until improvements are made and the A-rating is restored. However, certificates can still be issued for extending the stay of existing employees. To upgrade back to an A-rating, businesses must follow an action plan set by UK Visas and Immigration (UKVI) and pay a fee of £1,476 within 10 working days of notification. Failure to comply results in licence loss.
After completing the action plan, if the business meets all requirements, it regains its A-rating. Otherwise, it receives another B-rating and must follow a new action plan, incurring additional fees. A business can only receive two B-ratings during the four-year validity of its licence; failing to improve after the second B-rating leads to licence revocation.
The business cannot appeal for a revoked licence but can reapply after 12 months, starting a new application process. It is crucial for businesses facing downgrading or revocation to consult an immigration solicitor to navigate the process of regaining their UK sponsor licence.
Holding a sponsor licence comes with significant responsibilities. The Home Office expects sponsors to ensure that their foreign employees comply with their visa conditions, including working in the sponsored job and reporting various changes in their circumstances. Moreover, the Home Office will perform regular monitoring, so you must prepared for:
Record Keeping and Reporting
Companies must track and maintain detailed records for employees they sponsor. This includes keeping up-to-date and historical information on their contact details and addresses, passport copies, instances of absence from work, biometric residence permits (BRP), employment agreements, and National Insurance (NI) numbers.
Moreover, it’s essential to report specific changes in circumstances through the Sponsor Management System (SMS) to UK Visas and Immigration (UKVI). These changes can include alterations within the business, such as a change in ownership, as well as modifications in sponsorship matters, such as when a sponsored employee ceases to attend work.
Right-to-Work Checks and Documentation
Right-to-work checks are mandatory to ensure that all employees are working in the UK legally. Sponsors must verify and keep copies of relevant documents like passports and visas, ensuring employees verify them regularly.
Compliance Visits and Licence Validity
The Home Office conducts compliance visits, either announced or unannounced, to ensure that sponsors are fulfilling their obligations. These visits assess whether the sponsor is adhering to immigration rules and maintaining the necessary records.
Ongoing Audit from Home Office
The Home Office conducts ongoing audits to oversee the compliance of sponsors. These audits are crucial as they not only assess current compliance but also help in identifying areas where sponsors may need guidance or improvement to meet the required standards.
When sponsoring foreign workers under the age of 18, it’s crucial to ensure they have proper arrangements for their travel and arrival in the UK, as well as their living conditions while in the country. Additionally, a letter of consent from their parents regarding these care arrangements is mandatory.
Furthermore, a Disclosure and Barring Service (DBS) check is required for any of your employees who need it. Failure to comply with these requirements can result in the loss of your sponsorship licence.
Sponsoring foreign workers under 16 is limited to those on a Creative Worker visa, which might also require a performance licence or a Government Authorised Exchange visa. Additionally, sponsors should be aware of the regulations regarding the number of hours children are permitted to work and whether an employment permit is needed from the local council.
For scale-up workers, your sponsorship responsibilities commence from the date you assign them a Certificate of Sponsorship. These responsibilities terminate six months after either the ‘valid from’ date on the worker’s visa, for those who applied from outside the UK, or the date they receive permission to stay, for applications made within the UK.
UK Sponsorship Licences are not auto-renewable. Organisations must apply for renewal before the existing licence expires to maintain the validity of their sponsored workers’ visas.
The Home Office reviews four years of information and documentation to verify compliance, including:
The Home Office may request further documents, which must be provided within five days to avoid risks of application refusal, revocation, or reduced certificate of sponsorship allocation.
For organisations with at least two successful past renewals and no compliance concerns, a streamlined process is available, typically excluding:
Preparation for Compliance Visits
If not inspected in the last four years, expect a Home Office visit before renewal approval. Ensure your licence and SMS are fully updated before applying.
Seeking assistance in your sponsor licence application?
Tech Nomads is ready to assist you in sponsor licence application and further renewal processes.
To explore your options of hiring foreign employees, you may:
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