The importance of Sponsor Licence compliance: protecting your business and employees

2024 has seen a proliferation of Sponsor Licence suspensions and revocations by the Home Office. This serves as an important reminder of the paramount importance of strict compliance by employers to avoid such issues.

For UK businesses employing Skilled Workers from overseas, a Sponsor Licence is not just a tool for accessing global talent, it also involves significant responsibility. The Home Office imposes strict compliance requirements on sponsors, and even minor oversights can have serious repercussions, including suspension or revocation of your licence. Recently, the Home Office has been enforcing Sponsor Licence compliance more stringently, causing a rise in Sponsor Licence suspensions, revocations and penalties.

Many employers face challenges in navigating these obligations, particularly as immigration laws evolve. Below, we explore common compliance pitfalls, the consequences of non-compliance and the proactive steps businesses can take to protect their Sponsor Licence.

Understanding the challenges

Compliance with the Home Office’s requirements goes beyond obtaining a Sponsor Licence; it involves continuous monitoring and management of your sponsored workforce. One key obligation is record-keeping. Employers are required to maintain detailed and accurate records for all sponsored employees. This includes proof of their right to work in the UK, contracts of employment and documentation of salary payments. Even small errors, such as outdated contact details, can result in a breach.

Another critical area is timely reporting. Sponsors must inform the Home Office of specific changes, such as an employee’s resignation, certain adjustments to job role, or salary alteration, often within strict deadlines. Failure to meet these deadlines, even unintentionally, can trigger compliance investigations.

The Home Office also conducts audits to assess whether sponsors are fulfilling their obligations. During these visits, inspectors may request evidence of your compliance practices. Businesses that are unprepared, or that rely on disorganised HR systems, risk failing these inspections.

Adding to the complexity, immigration rules are frequently updated. For example, recent changes to salary thresholds and job codes can affect the eligibility of roles for sponsorship when the Skilled Worker’s visa comes up for renewal. Employers must stay informed to ensure that sponsored employees continue to meet the required criteria.

The consequences of non-compliance

The implications of non-compliance can be severe. Losing a Sponsor Licence means you can no longer sponsor Skilled Workers, potentially forcing valued employees to leave the UK. For companies relying on international talent, this can cause significant operational disruptions.

Additionally, the Home Office can impose financial penalties of up to £60,000 per worker found to be employed illegally. Employers may also be sent to jail for 5 years and must pay an unlimited fine if they are found guilty of employing someone who they knew or had reasonable cause to believe did not have the right to work in the UK. Beyond these immediate consequences, non-compliance can damage your company’s reputation, making it harder to attract talent in the future. The Home Office ‘name and shame’ employers of illegal workers on the Gov.UK website.

Steps to safeguard your licence

Maintaining compliance requires a proactive and structured approach. Conducting regular reviews of your HR systems and sponsorship records is essential to identify and resolve potential issues before they escalate. Investing in staff training ensures that key personnel understand reporting obligations and are prepared for Home Office audits.

Many businesses benefit from leveraging technology to track visa expiration dates and ensure reporting deadlines are met. Equally important is staying updated on immigration law changes. Assigning a dedicated compliance officer or partnering with an immigration law firm can help you navigate these complexities effectively.

Updated: 18 December 2024

How Gherson can assist

Gherson’s Immigration Team are highly experienced in advising on UK visa matters. If you have any questions arising from this blog, please do not hesitate to contact us for advice, send us an e-mail, or, alternatively, follow us on X, Facebook, Instagram, or LinkedIn to stay-up-to-date.

The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please do not hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.

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