SMS Level 1 & 2 User Training for Sponsors

Section A: Interactive SMS Level 1 & 2 User Training

Sponsor licence holders have to comply with the Immigration Rules and the duties set out in the sponsor guidance, or face enforcement action.

A substantial part of the compliance burden falls on the company’s Level 1 and Level 2 SMS users, who have to know how to use the Sponsorship Management System (SMS) to discharge their company’s compliance duties.

Level 1 or Level 2 SMS users are often heavily involved in the company’s day-to-day HR and immigration work, but this doesn’t make the system any more intuitive or user-friendly. The SMS is difficult to use, and the Home Office’s SMS user guidance is just as complicated.

Many companies also have only a small number of sponsored workers, so when users do need to log onto the system, they may not be confident or well practised in how to use it.

UKVI provides contact routes for technical and case-related enquiries, but sponsors cannot rely on the Home Office to advise them how to interpret or apply every reporting obligation. Responsibility for accurate and timely action remains with the sponsor.

DavidsonMorris SMS Level 1 & Level 2 User Training Course Programme

Our SMS Level 1 & Level 2 User training course is designed to give SMS users the knowledge and confidence to use the Sponsorship Management System correctly and efficiently.

During this highly practical and interactive session, our immigration experts will provide step-by-step guidance, including:

• Overview of the Sponsorship Management System and its principal functions
• Reviewing the sponsor’s current CoS allocation and licence activity
• How to prepare and submit a request for an increase in the sponsor’s CoS allocation
• How to apply for a Defined CoS under the Skilled Worker route
• How to review key personnel and submit permitted change requests
• How to review and change organisation details
• Understanding how to use the SMS to meet your compliance obligations
• Understanding how to carry out your reporting duties
• How to terminate employee sponsorship
• How to identify when an SMS request requires a submission sheet, supporting documents or separate correspondence with UKVI

Delegates will come away with a thorough understanding of how to operate the SMS and how to use the system to meet their employer’s sponsor duties.

Sessions have limited capacity to provide maximum benefit for delegates.

For more information about our SMS user training and to find out when our next sessions are taking place, contact us.

Section B: Role of SMS User Training

When a UK business holds a sponsor licence, the Sponsorship Management System (SMS) is the online platform through which all licence activity is managed. The SMS is the principal platform through which licensed sponsors manage their licence, assign CoS and report relevant changes. Certain requests may also require a submission sheet, supporting documents or use of a separate Home Office process. Without effective use of the SMS, it is impossible to comply with the sponsorship rules.

The Home Office requires every licence holder to maintain at least one eligible Level 1 user to carry out the sponsor’s day-to-day licence management through the system. Some employers will also choose to appoint Level 2 users, who have more limited access but can take on certain operational responsibilities. Both roles come with compliance weight because the SMS is where key sponsor duties are actioned. Tasks such as assigning Certificates of Sponsorship (CoS), reporting worker changes and notifying organisational updates are all performed through this system.

Errors within the SMS can have serious consequences. If the wrong information is reported, or if updates are made late, the sponsor is immediately at risk of enforcement action. The Home Office can suspend, downgrade or revoke a licence if it identifies failings. The sponsor guidance does not require users to complete a prescribed training course. Sponsors are nevertheless responsible for activity carried out through their SMS account, making appropriate instruction, supervision and competence controls important parts of licence management.

1. What is SMS Level 1 & 2 User Training?

Training for Level 1 and Level 2 SMS users is a compliance safeguard. The Sponsorship Management System is the Home Office’s direct channel for monitoring whether an employer is meeting its duties. Information submitted through the SMS forms part of the sponsor’s compliance record and may be checked against CoS data, payroll evidence, personnel files and other records during Home Office compliance activity. Without training, users are more likely to make errors that expose the organisation to penalties, licence downgrades or even revocation.

SMS user training should focus on two aspects. First is the technical knowledge required to operate the SMS correctly, such as how to assign a CoS or submit a change of circumstances request. Second is the compliance context. Users must understand the reporting deadlines, what must be notified through SMS, and what must be retained as internal records, such as a worker’s residential address. When both elements are covered, the employer reduces the likelihood of compliance breaches and strengthens the overall licence management framework.

Investing in training for Level 1 and Level 2 users also brings benefits for workforce planning. Delays caused by errors or rejections within the SMS can hold up recruitment timelines and create gaps in resourcing. Well-trained users will complete tasks accurately and within the Home Office’s timescales, ensuring that sponsored workers can take up their roles without unnecessary disruption.

Ultimately, the SMS is not an administrative tool to be picked up casually. It is the backbone of the sponsorship system and a direct line to the Home Office. Employers that treat Level 1 and Level 2 user training as a core compliance measure will protect their licence status and avoid costly interruptions to their recruitment plans.

2. Role of Training in Managing Compliance Risk

Training is the first line of defence against compliance risk. SMS activity may be considered alongside the sponsor’s records, systems and treatment of sponsored workers when UKVI assesses compliance. The risks are not limited to HR or compliance teams, they affect recruitment pipelines, business operations and workforce stability.

The sponsor licence regime operates on strict reporting obligations. The Home Office expects information to be accurate, timely and consistent with the sponsor’s internal records. An isolated administrative error will not necessarily result in formal enforcement, but it may still expose a weakness in the sponsor’s systems. Repeated, material or uncorrected errors are more likely to attract adverse action, particularly where SMS information conflicts with the sponsor’s records or affects a worker’s sponsorship. Proper training ensures SMS users understand the deadlines, reporting categories and the importance of getting details right first time.

The financial and operational risks of poor SMS handling are significant. A suspended licence immediately prevents the assignment of new Certificates of Sponsorship, putting recruitment on hold. A revoked licence can result in sponsored employees losing their right to work, creating major workforce disruption and reputational damage. Training equips users to spot issues early, handle reports correctly and escalate complex matters to senior staff or external advisers before they spiral into enforcement action. For employers, this proactive risk management is far less costly than reacting to penalties.

Delays in recruitment often stem from mistakes made in the SMS. A CoS assigned with incorrect details can lead to visa refusals or require re-assignment, which adds weeks to a hiring process. Reporting errors can also trigger Home Office queries that delay licence decisions or inspections. Training minimises these disruptions by giving users the confidence to perform tasks correctly the first time. In a competitive hiring environment, avoiding unnecessary delays can be the difference between securing a skilled candidate and losing them to another employer.

Well-trained users also contribute to smoother internal operations. HR teams and compliance managers can rely on SMS updates being completed accurately, reducing the need for corrective work. This efficiency allows organisations to focus resources on workforce planning and business growth rather than fire-fighting compliance problems.

3. Penalties for Non-Compliance

Home Office action depends on the nature, seriousness and frequency of the breach. Some failings may result in the licence being downgraded from an A-rating to a B-rating and an action plan being imposed. More serious concerns may lead to suspension while UKVI investigates, while specified or fundamental breaches can result in revocation without an earlier downgrade.

A sponsor that fails to complete an action plan successfully may lose its licence. The enforcement process should therefore not be treated as a fixed sequence in which every sponsor moves from downgrade to suspension and then revocation.

The most serious outcome of non-compliance is licence revocation. If the Home Office believes the employer has fundamentally failed to meet its sponsor duties, the licence can be withdrawn altogether. Revocation means the organisation loses the ability to employ sponsored workers, and UKVI will normally consider cancelling the permission of affected sponsored workers. The timing and effect will depend on the worker’s circumstances and the basis on which the sponsor licence was revoked. For businesses that rely on skilled international talent, this can create severe disruption, financial losses and reputational harm.

SMS failings can lead to sponsor compliance action, but they should not be conflated with the separate illegal working civil penalty regime. A reporting error or incorrect CoS assignment does not, without more, make a worker’s employment unlawful.

Illegal working liability may arise where an employer employs a person who does not have permission to undertake the work in question and cannot establish a statutory excuse through a compliant right to work check. The maximum civil penalty is currently £45,000 per illegal worker for a first breach and £60,000 per illegal worker for a repeat breach. The same underlying facts may expose an employer to both sponsor action and illegal working enforcement, but the legal tests are different.

The table below shows the stages of Home Office enforcement action, what typically triggers them and the impact for employers.

Errors in CoS assignment or late reporting can delay visa applications or cause refusals. Skilled candidates may lose patience or accept offers from competitors, leaving the business with critical skills gaps. These operational risks directly affect growth and service delivery, particularly in sectors that depend on overseas workers to fill shortages. Training ensures users know how to avoid errors that slow down recruitment and jeopardise business plans.

Compliance mistakes often trigger Home Office audits. During a compliance visit, officers may examine the sponsor’s recruitment practices, right to work processes, sponsored-worker records, payroll information and reporting systems. A pattern of avoidable SMS errors can lead to increased monitoring or additional audits in future. This consumes management time, increases legal costs and keeps the licence under constant pressure.

Employers who fail to train their SMS users take on unnecessary risks that go well beyond administrative inconvenience. In the Home Office’s eyes, errors are evidence of weak systems and poor compliance culture, both of which undermine the licence. Effective training is therefore a direct investment in safeguarding the business’s recruitment capability and protecting its reputation.

Section C: Who Should Have SMS Training?

Every organisation with a sponsor licence should ensure that its SMS users are competent, appropriately instructed and able to perform the functions allocated to them. The Home Office holds the licence holder accountable for the actions of all system users, which means employers cannot assume that individuals will “pick it up as they go along.” Training is necessary to reduce the risk of mistakes, maintain compliance and protect the ability to sponsor overseas workers.

1. HR Teams and Compliance Staff

In most organisations, the HR team or compliance function will be responsible for day-to-day use of the SMS. These staff members often act as Level 1 or Level 2 users and must be trained to understand both the technical system functions and the underlying sponsor duties. Given that many HR staff manage a wide range of responsibilities, without targeted training they may underestimate the significance of reporting deadlines or the implications of an error. Formal training helps them balance SMS duties against other priorities.

2. Authorising Officer Oversight

Although the Authorising Officer may not be the one regularly logging into the SMS, they have overall responsibility for the organisation’s activities as a licensed sponsor and for the conduct of its SMS users. They should therefore understand the organisation’s SMS processes well enough to oversee Level 1 and Level 2 users, review whether reports are being filed on time and step in if issues escalate. Training provides the Authorising Officer with the knowledge to question users effectively and to identify potential risks before they attract Home Office attention.

3. New Users and During Transitions

Whenever a new Level 1 or Level 2 user is appointed, training should form part of their onboarding. Users stepping into the role without instruction are more likely to make avoidable mistakes, particularly when they are unfamiliar with reporting categories or deadlines. Similarly, when organisations undergo internal change, such as mergers, acquisitions or restructuring, refresher training ensures that existing users are aligned with updated processes and that reporting responsibilities are not overlooked.

4. External Providers and Support Staff

Some employers appoint external immigration advisers as additional SMS users to support their compliance. An eligible UK-based representative may be appointed as an additional Level 1 user or as a Level 2 user, but cannot act as the Authorising Officer or as the sponsor’s sole Level 1 user.

An employee of an outsourced HR provider may also be appointed as an additional Level 1 user or a Level 2 user. A temporary worker supplied by an employment business may only be appointed as a Level 2 user.

Where external support is used, the organisation remains fully responsible for any actions carried out through its SMS account. Internal staff should therefore know how to monitor third-party activity, review records and maintain oversight. Employers cannot outsource accountability, so a clear understanding of how to supervise external support is crucial.

Ensuring all relevant personnel are trained creates resilience within the licence management structure. It prevents knowledge gaps, protects against compliance risks when staff change and demonstrates to the Home Office that the organisation takes its sponsor duties seriously.

Section D: SMS User Roles

The Home Office expects sponsors to give access to the Sponsorship Management System only to eligible and trusted personnel who understand the duties attached to their role. Within the system, Level 1 and Level 2 users carry distinct responsibilities, with different levels of access and authority. Knowing the boundaries of each role is vital, as errors or misuse can lead to compliance breaches that impact the entire licence. Employers should be clear on what each user can and cannot do, and why structured training is needed to prevent mistakes.

1. SMS Level 1 User Role and Responsibilities

A Level 1 user has broad access to the Sponsorship Management System and carries out the sponsor’s day-to-day sponsorship activities. Every organisation with a sponsor licence must have at least one Level 1 user in place. Because of this position, the Home Office expects Level 1 users to have a strong understanding of the sponsor’s duties and to be capable of carrying out those duties reliably.

The Level 1 user has the broadest system access of all user types. Their functions include assigning Certificates of Sponsorship, applying for Defined CoS, requesting increases in CoS allocations, reporting relevant changes affecting sponsored workers and the organisation, requesting changes to key personnel and managing Level 2 users. Level 1 users can also access messages posted by UKVI through the SMS.

The Authorising Officer may also be appointed as a Level 1 user, but the roles are distinct. An Authorising Officer does not have access to the SMS unless separately appointed as a Level 1 or Level 2 user. Level 1 users carry out the SMS functions required to support ongoing licence management. The sponsor remains responsible for ensuring that required actions are completed accurately and on time. If the sponsor fails to report a change or submits incorrect information, the Home Office will treat it as a compliance breach even if it was an error by the Level 1 user.

Level 1 users have the broadest administrative permissions within the SMS. They can assign CoS to migrant workers, apply for additional CoS allocations and request licence changes. They can add or remove Level 2 users and submit requests relating to additional Level 1 users. Employers must select Level 1 users carefully, ensuring they are trustworthy, competent and familiar with the organisation’s recruitment and HR processes.

A sponsor must maintain at least one eligible Level 1 user throughout the life of its licence. Under the current rules, the primary Level 1 user must generally be an employee, director or partner within the organisation and a settled worker, unless an exception applies. An external representative may act as an additional Level 1 user but cannot be the sponsor’s sole Level 1 user.

The Home Office permits an organisation to have more than one Level 1 user, which can be helpful for resilience if one user is absent or leaves the business. The sponsor can decide how many Level 1 users it needs, although access should be limited to those who genuinely require it. All users must meet the relevant eligibility and suitability requirements. A sponsor must maintain at least one eligible Level 1 user throughout the life of its licence. Failure to do so can result in Home Office action against the licence, including revocation.

Training for Level 1 users should cover both the technical operation of the SMS and the compliance framework within which they are working. They need to understand Defined and Undefined CoS, the rules governing their use and the applicable reporting timescales. They also need to be clear on the consequences of non-compliance, as their actions directly affect the sponsor’s risk rating.

In practice, training should include walkthroughs of the SMS interface, practice scenarios for reporting worker and organisational changes and case studies of common compliance pitfalls. Many compliance failures stem from HR not informing the Level 1 user of a relevant change or from the user misunderstanding whether an event must be reported. Training must therefore go beyond system navigation to include the wider compliance context, equipping the user to make accurate judgements and escalate issues when necessary.

Level 1 users should also understand the sponsor’s record-keeping processes, as the Home Office may compare sponsor records with information submitted through the SMS. Consistency between internal records and SMS updates is a common area of Home Office scrutiny. Without training, even experienced HR professionals can make mistakes that place the licence at risk.

2. SMS Level 2 User Role and Responsibilities

A Level 2 user is an additional role within the Sponsorship Management System (SMS) that provides more limited access compared to a Level 1 user. Employers often appoint Level 2 users to share the workload of day-to-day SMS functions, particularly in larger organisations where multiple people may need access to assign CoS or record permitted worker changes. While their powers are restricted, Level 2 users still play an important role in helping the sponsor meet its compliance obligations.

A Level 2 user can create and assign Certificates of Sponsorship and report activity relating to a CoS that they personally created and assigned, or that has been transferred to them by a Level 1 user. They cannot report activity relating to other CoS on the licence. Their role is limited to specified CoS assignment and worker-reporting functions. Level 2 access does not provide general authority to manage sponsored workers across the licence.

Because Level 2 users can interact directly with the SMS, they must still act in line with the Home Office’s compliance rules. Even though their access is restricted, any errors they make when assigning a CoS or updating information about a worker can expose the sponsor to compliance action. Employers therefore need to treat the appointment of Level 2 users as a serious decision rather than a convenience.

Level 2 users do not have authority to make structural changes to the sponsor licence. They cannot apply for additional CoS allocations, update key personnel details or make changes to the organisation’s licence status. They also cannot add or remove other users from the SMS. All of these functions remain the responsibility of the Level 1 user.

Level 2 access is limited to the functions permitted by the SMS. A Level 2 user cannot manage the licence, make organisational changes, manage other users or apply for additional CoS allocations. This limited scope reduces risk for employers but also means that Level 2 users are not a substitute for having sufficient Level 1 cover in place.

Level 2 users require training that reflects their narrower responsibilities but still equips them to avoid compliance breaches. They need to understand how to assign a CoS correctly, including the applicable route requirements relating to the role, salary, skill level and genuine vacancy requirement. They should also be trained on which worker reports fall within their permissions and when a matter must be referred to a Level 1 user. A Level 2 user can only report against a CoS they assigned or one transferred to them by a Level 1 user.

Training should focus on accuracy and consistency, as even small errors in CoS assignments can lead to visa refusals for workers or enforcement action against the employer. Level 2 users should also be aware of their reporting boundaries, so they know when to escalate matters to the Level 1 user instead of trying to handle them independently. Without this understanding, there is a real risk of compliance failures or missed reporting deadlines.

Employers should refresh training regularly, particularly when the Home Office updates sponsor guidance or introduces new rules. Level 2 users often have less direct exposure to compliance processes than Level 1 users, so ongoing support is important to keep their knowledge current and reduce the risk of mistakes.

The Home Office has begun phasing out Level 2 users for a limited group of Government Authorised Exchange sponsors and has indicated that the role may be removed more widely over time. Sponsors not currently affected do not need to take action, but should not structure licence governance around long-term reliance on Level 2 access.

3. Key Differences Between Level 1 and Level 2 Users

While both Level 1 and Level 2 users work within the Sponsorship Management System (SMS), their authority, responsibilities and compliance impact differ significantly. Employers need to understand these differences clearly so that access is allocated appropriately, training is targeted and accountability is properly managed.

a. Permissions

Level 1 users have the broadest administrative permissions within the SMS. They can manage the sponsor licence, update organisational details, add or remove Level 2 users, submit requests relating to additional Level 1 users, apply for extra CoS allocations and assign CoS to workers. Level 2 users, by contrast, have a much narrower remit. They can create and assign CoS and report activity relating only to CoS they personally assigned or that a Level 1 user transferred to them.

This distinction means employers must ensure that only individuals with appropriate seniority and trustworthiness are appointed as Level 1 users. Level 1 users perform functions that can affect the entire licence, but the sponsor remains accountable for their actions and the Authorising Officer retains overall responsibility for the sponsor’s activities.

b. Reporting Duties

Level 1 users can carry out the sponsor’s worker and organisational reporting functions through the SMS, while the sponsor remains responsible for ensuring that all reporting duties are met. They can report organisational changes, such as new addresses, mergers, takeovers or changes in key personnel, within the applicable deadlines. They can also report changes affecting sponsored workers.

Level 2 users can report worker activity only in relation to a CoS that they personally created and assigned or that has been transferred to them by a Level 1 user. They do not have responsibility for wider organisational notifications. If a Level 2 user misses or mishandles a worker report, the sponsor remains accountable for the failure.

c. Accountability

The sponsor remains responsible for all activity carried out through its SMS account. The Authorising Officer has overall responsibility for the organisation’s activities as a licensed sponsor and for the conduct of its SMS users. Even though Level 2 users may carry out practical tasks, they operate under the oversight of Level 1 users. Compliance failures by a Level 2 user are treated as failures of the licence holder, not of the individual.

For employers, this makes it important to create clear internal lines of accountability. Level 1 users should monitor the activity of Level 2 users, review reporting logs and ensure that delegated tasks are being performed accurately. Regular internal audits and training updates can help reduce the risk of errors slipping through.

Summary

The Sponsorship Management System is the backbone of the sponsor licence framework. Level 1 and Level 2 users carry out updates and reports through the SMS, but the sponsor remains responsible for ensuring that its licence duties are met. Errors or gaps in reporting can expose the business to penalties, licence suspension or even revocation. For that reason, training is a practical compliance safeguard that directly supports the organisation’s ability to employ sponsored workers.

Well-trained SMS users understand both the technical steps within the system and the compliance weight behind each action. Employers who invest in structured training reduce the risk of breaches, ensure smoother recruitment processes and demonstrate to the Home Office that they take their duties seriously. In a competitive market for international talent, the ability to issue Certificates of Sponsorship quickly and without errors is a strategic advantage.

Ultimately, training Level 1 and Level 2 users is a cost-effective way to strengthen compliance culture, minimise operational risk and maintain long-term licence security. Employers that build training into their compliance framework will be best placed to retain their licence, safeguard their workforce and support business growth.

Need Assistance?

Managing a sponsor licence carries legal and operational risks. Errors in the Sponsorship Management System can put your ability to employ overseas workers at risk. Our SMS Level 1 & Level 2 User Training is designed to give your team the skills and confidence to use the system correctly and meet every Home Office duty.

We deliver interactive, practical level 1 & 2 user training, specifically designed to ensure your SMS users understand both the technical system functions and the compliance context behind them.

Contact us to book your SMS User Training and safeguard your licence with expert support.

FAQs on SMS Level 1 & 2 User Training

How many Level 1 users can a sponsor have?

A sponsor must maintain at least one eligible Level 1 user throughout the life of its licence and may appoint additional Level 1 users where needed. The Home Office does not prescribe a fixed maximum, but access should be limited to those who genuinely require it while maintaining sufficient cover for absence or staff turnover. Every user must meet the relevant eligibility and suitability requirements.

Can a Level 2 user be appointed as a Level 1 user?

Yes, provided the individual meets the relevant eligibility and suitability requirements. A Level 1 user must submit the appropriate request through the SMS. The appointment is not simply an automatic extension of the individual’s existing Level 2 permissions.

Do Level 1 and Level 2 users need formal qualifications?

No formal qualifications are required, but users must be competent, reliable and familiar with the organisation’s HR and compliance processes. They must meet the relevant eligibility and suitability requirements and be capable of carrying out the functions assigned to them accurately and on time.

Is training mandatory under Home Office rules?

The Home Office does not mandate formal training courses, but sponsors are held accountable for the actions of their users. In practice, appropriate training, instruction and supervision are sensible compliance controls because the sponsor remains responsible for actions carried out through its SMS account.

What happens if a sponsor has no active Level 1 user?

A sponsor without an active Level 1 user will be unable to carry out normal licence-management functions through the SMS. If no Level 1 user can access the account, the sponsor must use the sponsor change of circumstances form to request a replacement. Sponsors are required to maintain at least one eligible Level 1 user throughout the life of the licence, and failure to do so can result in Home Office action against the licence, including revocation.

Glossary

Additional Resources and Links