A UK sponsor licence application is an extremely valuable asset for those businesses wishing to hire skilled workers from abroad. It requires a commitment to the rules and regulations of the Home Office so that the licence is valid. Having obtained this licence, sponsors can sponsor employees for four years. After that period elapses, businesses must renew it if they want to legally sponsor workers. Lack of compliance with the requirements mentioned will cause a sponsor licence suspension. This article will reveal how to renew the sponsor licence and the ways you can avoid suspension or revocation.

Understanding the Sponsor Licence Renewal Process

Businesses are required to renew their sponsor licence every four years to continue sponsoring foreign workers before April 2024. The procedure included providing all relevant documents and a renewal fee, but it was recently streamlined. The relevant update from April 2024 is that sponsor licences are extended automatically for ten years without requiring businesses to provide periodic renewals. Though this is so, compliance remains essential, and the Home Office will still carry out audits to ensure that businesses are actually meeting their duties as employers.

Compliance Obligations of Sponsor Licence Holders

Even though the renewal process has become easier, compliance with home office regulations is always mandatory. Failure to comply will lead to suspending a sponsor licence; this effectively means that the business cannot hire new workers, which may seriously jeopardise the ability to retain sponsored employees already in existence.

These are the major areas of compliance for a sponsor licence holder:

Record-Keeping: The employer has to keep proper and detailed records of the sponsored workers. Passports, visas, and Certificates of Sponsorship are examples of these records. In sponsor licence suspension cases, poor record-keeping is believed to be one of the most common.

Right-to-work checks: An employer has an equally important obligation to ensure that all his employees, sponsored or otherwise, have a legal right to be in the UK. This entails conducting the right-to-work check and documenting it. Failure to do this results in civil penalties and licence suspension​.

Informing Changes to the Home Office: If anything has changed, the Home Office must be informed of a sponsored worker’s employment status. To illustrate, if the sponsored worker changes or leaves his work, the same purpose is served by the Sponsor Management System.

Monitoring Sponsored Workers: An employer must ensure that the workers they sponsor are allowed to work only on the terms of their visa. They must monitor absence and ensure that the workers work only in the capacity of the employer for which they were sponsored. Failure to comply with these duties will automatically result in the attention of the Home Office and may lead to suspension or revocation.

What Happens During a Compliance Audit

Even without the renewal cycles, sponsor licence holders are expected to be subjected to compliance audits from the Home Office. The compliance audit can be scheduled or include a surprise to ensure that the businesses comply with their sponsorship duties​. In the course of an audit, the Home Office might:

Inspect HR and Personnel Records: Inspectors may ensure that the businesses will maintain accurate records, such as employment contracts, pay slips, and proof of right-to-work checks​.

Interview Sponsored Workers: Auditors may interview employees to establish whether the data they declare in the CoS reasonably reflects their actual work and responsibilities.

Examine Compliance Processes: Inspectors will verify whether the businesses involved properly adhere to all reporting and record-keeping practices.

If any form of breach is discovered during an audit, the Home Office may delay licence consideration until further investigations are conducted. In extreme cases, the licence might be revoked. The business would not sponsor new workers and may also be affected by the sponsored employees on its payroll.

How to Avoid Suspension of Sponsor Licence

The compliance process does not end – rather, a business must stay alert so that no breach occurs in getting suspended its sponsor licence application. Here are the key steps to avoid suspension:

Conduct Regular Internal Audits: Regular audits of your HR systems and compliance processes can discover and address many potential issues before they become serious. They will also ensure proper and complete records.

Train Your HR and Compliance Teams: Your HR team should be trained on the requirements of the sponsor licence. They should understand how the Sponsor Management System (SMS) is applied and their responsibilities around record-keeping, right-to-work checks and reporting duties.

Keep Records Up to Date: Employee records, including passports, visas, and COS, must be up to date. If anything changes your employees’ roles or circumstances, you should always inform your HR team and report it so they can update any and all records immediately.

Monitor Changes in Immigration Law: Immigration rules do not remain static. You should always be aware of those changes and ensure that your business is keeping abreast of the updated rules. Thus, you can avoid any compliance breach thereafter.

Consequences of Suspension and Revocation of Sponsor Licence

You cannot issue any new CoS when the Home Office suspends your sponsor licence; this will restrict your recruitment. The suspension also flags to UKVI that you raise serious concerns about having a dubious compliance record, and failing to rectify it within a specific time frame will result in losing your licence.

Revocation is more severe than suspension because it results in a complete and permanent loss of the sponsor licence. If your licence is revoked, all sponsored workers will have their visas curtailed, and you will not be eligible to apply for a new sponsor licence for a minimum period of 12 months.

Get Professional Legal Aid

Stay on the right side of the Home Office and avoid the sponsor licence suspension. While the renewal processes have been tweaked recently, eliminating quite a few of the administrative burdens on businesses, it is not a time to relax. The licence stays alive through the use of systematic audits, good HR processes, and reporting so your business can keep hiring skilled workers from abroad. A Y & J Solicitors offer tailor-made legal advice on the UK immigration system for businesses. We provide professional assistance for sponsor licence application and compliance. 

A Y & J Solicitors is a specialist immigration law firm with extensive experience with the sponsor licence application. We have an in-depth understanding of immigration law and are professional and results-focused. For assistance with your visa application or any other UK immigration law concerns, please contact us at +44 20 7404 7933. We’re here to help!