Immigration Audit

The Home Office has powers to conduct onsite and digital compliance inspections with any UK employer. An immigration audit can help you stay compliant and avoid penalties.

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Immigration audits are one of the most effective ways to manage immigration compliance risk and avoid Home Office enforcement action.

Immigration compliance is a non-negotiable. Whether or not you employ foreign nationals, all UK employers are under a mandatory legal obligation to meet certain immigration compliance duties. This includes the requirement to carry out right to work checks indiscriminately on all of your workforce.

The Home Office has powers to conduct immigration inspections and investigate employers’ HR systems, processes and personnel records to verify compliance.

If the Home Office establishes a breach of these duties, the employer becomes subject to the civil penalty scheme, potential criminal sanctions and restrictions on sponsoring foreign nationals to work in the UK.

Ultimately, the Home Office expects employers to make immigration compliance part of their everyday business operations. Processes, policies, personnel knowledge and working practices must all be aligned to Home Office standards throughout the organisation.


What is an immigration audit?

An immigration audit is a formal exercise used by employers to review and assess their HR processes, policies and documentation to ensure compliance with their legal obligations.


Why use an independent auditor?

It is beneficial to engage an external auditor to derive full benefit from an immigration audit. Not only can you benefit from expert insight into compliance best practice, using an external assessor can help to replicate a real inspection, enabling your HR and other relevant personnel to feel prepared and confident in the event they have to deal with a real Home Office inspection.

At DavidsonMorris, we have supported hundreds of employers in preparing for immigration inspections through mock audits. We understand the compliance obligations to be met and what the inspectors will be looking for. We bring this together through practical feedback and guidance to help employers address potential issues to attain full compliance and avoid enforcement action.

Importantly, we also have indepth knowledge of the rules and regulations which inspectors must follow when conducting a site inspection – and can advise if there are issues such as potential procedural errors or inspectors overreaching when exercising powers.


Employer immigration compliance obligations

All UK employers are required to comply with the Right to Work regime, verifying every worker’s eligibility to carry out the work in question before they start employment, and in some cases, during employment should the worker’s permission be time-limited.

Under the legislation, employers face civil and criminal penalties if they have hired an illegal worker and knew or had reasonable cause to believe they did not have the right to work.

In addition to Right to Work checks, employers who have obtained a sponsorship licence to sponsor foreign workers also have to meet additional compliance duties. These include record-keeping for each worker they sponsor, and monitoring and reporting certain changes to the Home Office via the Sponsorship Management System (SMS).

Sponsor licence breaches can result in a licence downgrade, suspension or revocation, impacting the organisation’s ability to recruit and continue sponsoring overseas workers. These are clearly unwanted repercussions for care providers already struggling to maintain staffing levels.

Immigration audits are an important tool in managing an organisation’s compliance risk.


Reasons to carry out an immigration audit

Meet your compliance duties

UK organisations must ensure they have the required evidence of employees’ right to work on file, and that HR systems and processes are compliant. Complying with the prescribed document checks can be complicated, particularly where you are employing individuals with time-limited permission to work in the UK or limitations on the type of activity they can undertake.

Organisations who hold a UK sponsor licence are also subject to additional stringent compliance requirements as part of their sponsorship licence duties. You can expect to be visited by the Home Office at any time during your licence period, often without prior notice.

Don’t let the Home Office pick up on the issues for you. An immigration audit can help identify and resolve areas of non-compliance in your organisation, to avoid Home Office scrutiny and penalties.

Changing legal obligations

UK immigration rules and guidance are subject to frequent change. This means employters have to stay informed of new and updated obligations, and to adapt their processes and procedures accordingly.

Undertaking an audit of your HR processes and systems is an effective method in identifying areas of compliance weakness and ensuring you are operating to the current requirements on you as an employer.


If you can show your organsiation has taken all reasonable steps and a sustained and informed commitment to compliance may be taken in mitigation of any potential issues or breaches, resulting in reduced or cancelled penalties.

Help your staff feel prepared

Site visits are stressful, and even employers with a good understanding of the rules can easily fall foul of their duties if their processes and documents have been left unchecked for some time.

Avoid operational disruption

If your organisation’s sponsor licence is suspended or revoked, you will no longer be allowed to sponsor migrant workers. If your organisation depends on sponsored workers, your operations may well be detrimentally impacted, resulting in financial and reputational loss.

Avoid unwanted demand on your HR resources

Taking a proactive approach to compliance risk will help you to avoid additional effort and stress on your HR team.

If the Home Office identifies compliance breaches, you will be required to take urgent remedial action to rectify these and attain the necessary compliant standards. This will place considerable pressure and demand on your HR function. If you are subject to a Home Office action, not only will you have to pay for this, you will also have to dedicate resources to implement the plan.

Avoid curtailed visas for your sponsored workers

If your organisation’s sponsor licence is suspended or revoked, you will no longer be allowed to sponsor migrant workers. As your sponsored workers will no longer have a valid sponsor, their visa will be curtailed and they will be forced to find new sponsored employment or they will have to leave the country.

Avoid penalties

If you do not seek the proper permission to employ workers from overseas, as well as undertake all prescribed documentation checks, you are liable for fines of up to £20,000 per worker and, in some cases, even imprisonment.

Small business compliance

For smaller companies, meeting immigration compliance duties on an ongoing and consistent basis can be challenging, particularly if there is no dedicated HR resource within the business. It’s not however a situation that the Home Office will accept as a defence against any breaches. Regardless of the size of operation, or how many migrant workers you sponsor, as an employer you have to comply with the regulations.

Engaging an external auditor is a proactive way to ensure you are meeting your compliance obligations and to avoid enforcement action.


Home Office compliance inspections

Immigration audits are highly valuable in preparing an organisation for a Home Office compliance inspection.

Employers are expected to be compliant with their immigration obligations at all times. As such, the Home Office has powers to inspect any UK employer at any time.

In some circumstances, particuarly where serious allegations of non-compliance have been made or where there is a history of previous breaches, the Home Office may not give advanced notice and will attend unannounced.

In most cases, the employer will be notified in advance of the visit. This will allow some time for preparation, but where an immigration audit has recently been completed, the organisation will be in a strong position going into the inspection.

The following are likely to trigger an inspection:

Pre-licence visit

If you are applying for your first sponsorship licence, you may be inspected by immigration officials to determine if you meet the compliance requirements on sponsor licence holders.

Compliance breaches identified during the inspection can result in your licence application being refused – an unwanted outcome given the investment demanded when making the application.

Post-licence visit

Once granted, a sponsorship licence is valid for four years. At the end of this period, sponsors can extend their permission by making an application to renew their licence. As part of the renewal process, employers may be visited by the Home Office.

The visit is designed to assess whether you have met, and continue to meet, your sponsor licence duties and as such, qualify to retain your licence to hire from overseas.

Following the site inspection, the Home Office will produce a comprehensive audit report with every discrepancy identified. You will have an allocated time to reply to this report and to provide a response to the issues identified.

In instances of non-compliance, the outcome of this audit could result in your sponsor licence being revoked and any overseas sponsored workers having to leave the UK.

Government agency data sharing

Following significant investment in data-led monitoring technology and enhanced integrations with HMRC, the Home Office now has access to more information than ever to help identify illegal working.

Data sharing and enhanced systems tie-in with UK tax authorities are providing the Home Office with unparalleled intelligence and information relating to employers and employees – salary, tax contributions and wider financial position. Cross-referencing this data with information held on the SMS may trigger red flags, such as Skilled Worker migrants being paid less than the salary level required under the terms of their visa, which could result in an onsite inspection to investigate further.

Processing employee applications

When a sponsored employee applies for indefinite leave to remain, they have to submit details to the Home Office relating to their employment and immigration status. In practice, the Home Office may at this stage look into their employer’s immigration affairs.

This could raise inconsistencies or issues with the information on the employer’s SMS, which could lead to further investigation. A common issue identified in this scenario is when the employer’s sponsor licence has been left to expire.

Sponsor licences are allocated for a period of four years. If you do not successfully apply to renew your licence in advance of the expiry date, the licence will automatically expire. If your company’s sponsorship licence expires, your sponsored employees will no longer be lawfully employed. The expectation is that you have effective processes in place to renew your licence on time.

Sector-focused targeting

The Home Office undertakes specific enforcement efforts towards specific areas of the economy, such as Operation Brycem which targeted the care home sector. These operations often lead to unannounced ‘raids’.


‘Whistleblowers’ are a prolific source of intelligence for the Home Office. Where there is sufficient insight, the Home Office may respond by attending the employer’s premises to investigate the allegations. A common example is where a disgruntled former employee contacts the Home Office with concerns about illegal working.


What happens during a Home Office inspection?

On the day of the inspection, your premises will be attended by immigration compliance officers. They have powers to request documents and records from across the HR function and relating to the entire employment lifecycle, from recruitment to exits. They will be looking for evidence of an effective and consistent approach to immigration compliance.

They may also ask to interview certain members of staff, such as HR personnel and sponsored workers, or anyone of interest to the compliance officers.

The officers will not provide a decision on the day of the inspection, but they would usually indicate when to expect to hear the outcome of the visit.

The employer should then receive a summary of the findings along with the Home Office’s decision, which could include granting the licence application, or notifying of compliance breaches. Where breaches are alleged, the notification will also detail the next steps and any action required to improve or correct the issues.


What happens if you fail a Home Office inspection?

If immigration officers discover issues during an inspection, your organisation could face punitive action.

Under the prevention of illegal working regime, UK employers face substantial fines per compliance breach.

Criminal prosecution may also result if the employer is found to have knowingly employed an illegal worker.

If the Home Office has carried out a pre-licence inspection, any non-compliance can result in your sponsor licence application being refused.

If you already have a licence, it could be suspended or even revoked, impacting your permission to hire sponsored workers and potentitally resulting in curtailed employee visas.


What happens in a mock immigration audit?

At DavidsonMorris, we will design an immigration audit around your organisation. For example the approach may differ between a small employer with one business location and a multinational employer with a UK head office and multiple branches nationwide.

We apply our insight and wealth of experience in supporting employers with Home Office inspections to ensure we are assessing all relevant and possible areas of compliance, and providing practical recommendations and improvements to achieve full compliance.


How long does an immigration audit take?

This duration of the audit will depend on the scale and complexity of the project. The broader the reach and the more items there are to assess, the longer the audit will take.

When should you do an immigration audit?

Establishing or improving HR systems and processes

If are going through a period of growth or are transforming your HR function for enhanced efficiency and impact, an immigration audit will identify areas of strength and risk to help shape your transformation.

Reduce compliance risk

Mock audits are invaluable to any proactive risk management strategy. If you have concerns or have identified potential issues, an audit will help provide clarity around the actual issues and how these should be resolved.

In advance of a Home Office inspection

If you have been informed by the Home Office that your organisation will be subject to an inspection, the most effective preparation is to carry out a mock inspection, preferably allowing enough time for any remedial action to be undertaken in advance of the visit.

In response to Home Office enforcement action

If your organisation’s licence has been downgraded or suspended, you will need to take urgent action to correct the breaches. An audit will be effective in identifying the specific issues that need to be fixed in order for your permission to sponsor foreign nationals to be restored.

As part of your sponsor licence renewal application

If your organisation has never been inspected by the Home Office, you should prepare for an inspection in response to your licence renewal application. The inspectors will be looking for confirmation that your organisation is operating properly in respect of your compliance obligations and that your HR systems, documents and processes meet the relevant standards.

It has been years since your last audit, or you have never audited at all

UK immigration compliance duties and rules are subject to frequent change. If your organisation has never undertaken a compliance audit, or if many years have passed since the last audit, it would be advisable to formally review your immigration compliance, systems, and processes to ensure they meet the current standards and requirements.

Following organisational changes

It’s best practice to conduct an immigration audit following key organisational changes, events or developments, such as a merger or acquisition. This will be a valuable exercise in supporting risk management and transition efforts of any restructuring or corporate transaction project.


Common areas of immigration compliance risk

Audits commonly identify areas of non-compliance such as:

  • HR paperwork relating to overseas workers is either below the required standard or non-existent.
  • Instances where workers are being sponsored without having passed the required English language and competence exams within the required timeframes.
  • Poor management and processes for verifying the right to work status of those with time-limited permission to work (so-called ‘List B’ workers).
  • Low levels of reporting on the online ‘Sponsor Management System’ (SMS) regarding salary changes, leavers, switchers and changes in working locations.

If you are a sponsor licence holder, you must also ensure to:

  • Verify that migrant workers possess the ‘necessary skills, qualifications or professional accreditations’ to undertake the specific role.
  • Assign a COS only where the role in question is suitable for one.
  • Check your employees’ immigration status on an ongoing basis.
  • Keep copies of relevant documents for each employee, including passport and right to work information.
  • Record sponsored employees’ attendance.
  • Keep employee contact details up to date.
  • Report changes in your circumstances to UKVI within 20 working days.
  • Notify UKVI if any of your sponsored workers are not complying with the conditions of their visa, and report to UKVI if there is a problem, for example if your employee stops coming to work.


How to manage immigation compliance

There are a number of steps employers can take to ensure compliance with their immigration duties and avoid Home Office penalties.

Mock audits

These are extremely useful in highlighting issues before the Home Office arrives. By undertaking a full review of all documentation and supporting HR paperwork against Home Office standards and requirements, you should identify records which are lacking in content as required by the Home Office or where information not been kept up to date. Also include mock interviews with staff most likely to be interviewed by the Home Office.

HR policies

You should have specific policies in place covering recruitment, management and record-keeping relating to foreign staff. Policies should provide guidelines, standards and processes to ensure your operations are compliant with your immigration duties. The Home Office will request sight of your HR policies as part of the site inspection.

Maintain your SMS

The Home Office expects your SMS information to be up to date, providing a snapshot of your business at any given time. Failure to maintain the information in the SMS is in breach of the company’s duties.

Onboarding & pre-employment checks

As part of your pre-employment checks, you are expected to take reasonable steps to ensure the identity documents submitted are genuine and that the person presenting for work is the same person the documentation relates to.

Keep up to date

The Home Office expects all sponsor licence holders to be up to date on the duties placed on them. UK Immigration Rules change frequently, and invariably impact on employers and what they need to do to remain compliant. Subscribe to updates on changes to Immigration Rules to ensure you are informed and can react accordingly by adapting policies and processes, and communicating these changes internally.

Leavers’ personnel records

The Home Office has the right to request employee documentation for up to two years after a sponsored employee has left your employment, but companies often delete or destroy leavers’ documents before this date. Penalties can be issued if you are unable to produce this documentation when requested by the Home Office.

Staff training & support

Appropriate training of relevant staff involved in your organisation’s immigration compliance processes is essential. All personnel involved with recruitment, on-boarding and line management of foreign staff should be trained and skilled in meeting immigration duties. Evidence of an ongoing commitment to best practice will be a further indicator to the Home Office of compliant operations.

Roles & responsibilities

It is also crucial that anyone involved with the sponsor licence – branch managers, HR staff, visa holders etc – understand what is required by the Home Office and what their role is in complying with the obligations.

The sponsor licence also requires holders to nominate ‘Key Personnel’. These positions must be formally assigned to individuals within your organisation, and records kept as evidence. In addition, ensure all operational requirements are formally assigned, addressing circumstances such as planned and unplanned absence cover and leavers.

Working outside sponsor licence terms

Even where it would ordinarily be considered a reasonable and standard working practice, a sponsored worker working outside the licence conditions can render the employer noncompliant. For example, while a role may require the sponsored worker to work across different facilities or offices, each site has to be expressly permitted under the licence.

Record everything

The most common area of compliance risk is record keeping. The Home Office is looking for evidence of a sustained and consistent approach to managing sponsor licence documentation. If in doubt – keep it.


Need assistance with an immigration audit? We can help

DavidsonMorris’ immigration audit services can greatly ease the burden of ensuring that your organisation is, and remains, compliant with all immigration requirements.

As a team of immigration lawyers and former Home Office employees, we have an established reputation for conducting immigration audits and advising employers on compliance with their duties.

As part of our audit and compliance service, we consider a number of different aspects of compliance, which include:

  • Right to Work document checking systems and processes – which documents are acceptable, when documents are checked, how copies are annotated and stored and diarising further required checks.
  • Processes to avoid discrimination whilst complying with Prevention of Illegal Working requirements.
  • Systems addressing immigration requirements such as permitted working hours for sponsored workers.
  • Systems addressing sponsorship requirements such as minimum skill levels, minimum salary levels and advertising a vacancy to settled workers first.
  • Systems addressing a sponsor licence holder’s duty to report to the Home Office events relating to the sponsored migrants’ employment and circumstances and on certain changes to the business itself.

Where appropriate we will provide sample documentation and suggest changes and suggestions as to how systems can be improved.

Immigration Audit FAQs

What is an immigration audit?

An immigration audit is an assessment of your organisation's HR documentation, policies and processes to identify areas of non-compliance and risk that require remedial action. Audits are effective exercises to prepare your organisation for Home Office inspections.

Can a certificate of sponsorship be denied?

A Certificate of Sponsorship cannot itself be 'denied'. In practice, it would be either the organisation's sponsor licence application or the foreign national's visa application that can be denied by the Home Office. This is because Certificates of Sponsorship are assigned by the employer and act as confirmation to the Home Office that the individual meets the relevant criteria for the work visa being applied for.

What is immigration compliance?

Immigration compliance refers to how organisations meet their legal obligations in respect of preventing illegal working and upholding UK immigration laws.

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