For UK businesses that rely on overseas talent, holding a valid sponsor licence is essential. However, securing a sponsor licence is just the beginning. The real challenge lies in maintaining compliance with the Home Office’s ongoing sponsorship duties – something many employers are struggling with.
The compliance challenge employers face
Recent figures are telling: in the first half of 2024 alone, 833 sponsor licences were suspended and 709 were revoked. That is a significant increase compared to the entire 2023, which saw 569 suspensions and 337 revocations. The consequences of licence revocation can be devastating, as not only will a business lose the ability to hire new non-UK workers, but current sponsored employees will be forced to leave the UK unless they find alternative sponsorship within 60 days.
We highlight the five most common mistakes UK employers make after receiving a sponsor licence and offer practical advice on how to avoid them.
1. Right to work checks
- The mistake: employers failing to carry out fully compliant right to work checks, especially for Biometric Residence Permit (BRP) holders.
- The importance: physical BRPs can no longer be used to prove an individual’s right to work. Instead, employers must use the Home Office’s online system with a share code provided by the worker. Civil penalties of up to £60,000 per illegal worker may arise if you do not comply with this requirement or examine incorrect documents.
- Action points:
- Always request a share code and complete the check at gov.uk/view-right-to-work before employment begins.
- Keep a dated record of the check and who completed it.
2. Reporting organisational changes
- The mistake: not notifying the Home Office of significant business changes, such as:
- Changes to the company’s registered address.
- Mergers, acquisitions or demergers.
- Changes in ownership or legal name.
- The importance: these changes can affect your sponsor profile. A failure to report them can lead to compliance penalties or even suspension of your licence.
- Action points:
- Report all relevant changes using the Sponsor Management System (SMS) within 20 working days.
- Make immigration compliance part of your corporate governance and due diligence process during business restructuring.
- Ensure that your Authorising Officer, Key Contact, and Level 1 users are kept informed of any changes.
3. Monitoring of sponsored workers
- The mistake: failing to keep tabs on key details such as visa expiry dates, changes in job roles, salaries, work locations and prolonged absences.
- The importance: sponsors are obligated to report any material changes in a sponsored worker’s employment. If a worker is found to be working outside the terms of their visa – whether through a change in duties or location – it constitutes a breach.
- Action points:
- Immediately report any changes in role, salary or work location through the SMS.
- Use HR systems that include automated alerts for visa expiry, absences, and contract changes.
- Record all absences meticulously, especially those over 10 consecutive working days.
4. Poor record-keeping practices
- The mistake: not maintaining proper records such as:
- Copies of right to work documents
- Up-to-date contact details
- Job descriptions aligned with the Certificate of Sponsorship
- Absence and salary records.
- The importance: the Home Office requires sponsors to maintain detailed records to demonstrate ongoing compliance. Incomplete or outdated documentation can lead to audits, penalties, or licence revocation.
- Action points:
- Invest in digital platforms that offer audit trails and secure document storage.
- Conduct internal compliance reviews regularly to ensure records are accurate and complete.
5. Lack of preparation for sponsor licence audits
- The mistake: treating Home Office audits as a formality or failing to prepare for them at all.
- The importance: audits are a key method for the Home Office to assess ongoing compliance.
- Common issues uncovered during audits include:
- Sponsored workers not performing the duties listed on their Certificate of Sponsorship.
- Salaries not matching those declared in the certificate.
- Gaps in record-keeping or reporting.
- Common issues uncovered during audits include:
- Action points:
- Conduct mock audits with the help of immigration compliance experts.
- Ensure that job descriptions and salaries are consistent with what has been reported to the Home Office.
- Keep all compliance documentation organised and accessible in case of a short-notice audit.
Final thoughts
Sponsor licence compliance is not a one-time task – it is an ongoing commitment. The rising number of suspensions and revocations highlights the need for businesses to treat this responsibility with the seriousness it deserves.
Need guidance on managing your sponsor licence or preparing for an audit? Contact our Business Immigration Team today for a confidential consultation.
Updated: 22 April 2025
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