Scale Up Sponsor Licence
The Scale Up Sponsor Licence is a mandatory requirement to hire workers under the Scale Up route.
We are specialists in Home Office sponsor licence applications.
Scale Up Sponsor Licence
The Scale Up route allows qualifying employers to hire skilled workers from overseas, with the sponsorship requirement limited to only the first six months of employment.
The route therefore offers enhanced flexibility to both the employer and worker compared with the fully-sponsored Skilled Worker visa.
However, the employer must have been granted a Scale Up Sponsor Licence to be able to recruit workers from overseas under this route. The Sponsor Licence application process demands extensive supporting documentation to be collated and submitted, and the employer must meet ongoing compliance duties while sponsoring workers.
For expert guidance on recruiting and sponsoring Scale Up workers, contact our UK business immigration specialists.
What is the Scale Up Sponsor Licence?
The scale up route allows businesses who are going through a sustained period of high growth to recruit overseas nationals to work for them. However, a migrant worker will only be able to apply for a scale up visa if they first have the offer of a highly skilled job role from a qualifying UK scale up sponsor.
A scale up sponsor licence is the permission granted from the Home Office for a UK-based business to recruit and sponsor a migrant worker on this route. This will allow the business to issue a worker with a valid Certificate of Sponsorship (CoS) for them to be able to apply for a scale up visa to work in the UK in their sponsored role, although the worker must have the skills to enable the business to continue to grow. This means that they must be working in a job at the required skill and salary level for a minimum period of six months.
The job role on offer must be at graduate level or above, paying at least £33,000 per annum or the going rate for that job, whichever is the higher. The migrant worker must also be able to meet an English language requirement, as well as a financial requirement.
Scale Up Sponsor Licence: General Requirements
As with any sponsor licence application there are various general requirements that must be met. To be granted a scale up sponsor licence, the UK-based business must be:
- a genuine organisation that is operating lawfully in the UK
- honest, dependable and reliable, and not engaging and has not engaged in behaviour or actions not conducive to the public good
- capable of carrying out its sponsor duties and evidencing compliance.
The honesty, dependability and reliability etc of the applicant will be assessed by looking at the history and background of the business, the key personnel named in the application and any people involved in the day-to-day running of the business. The key personnel are those people named on the licence application that will be responsible for managing any migrant workers. Some or all of these people will also have access to what is known as the Home Office sponsorship management system (SMS) after a scale up sponsor licence is granted.
To assess whether an applicant is capable of meeting its sponsor obligations, the business will need to have in place suitable human resources and recruitment practices. A pre-licence compliance check may even first be undertaken before being granted a licence.
Scale Up Sponsor Licence: Specific Requirements
In addition to the general sponsor licence requirements, to be eligible for a scale up sponsor licence, a business must be able to offer a migrant worker genuine employment that meets the minimum skill-level and salary requirements for this route ‘and’ meet the definition of a qualifying scale up sponsor. To qualify, the business must meet the following criteria:
- it must have an annualised growth of 20% or more for the previous three-year period based on either the number of people employed or turnover, and
- it must have had at least 10 employees at the start of the relevant three years.
A scale up sponsor licence application will be refused if:
- the details provided with the licence application cannot be matched to HMRC records and confirmation cannot be obtained that the business is solvent
- the business does not have at least 37 months of history with HMRC
- the business does not have at least 10 employees at the start of this 37-month period
there are gaps, ie; periods without data, within the 37-month assessment period.
If the applicant does not fall down on any of these potential hurdles, automated checks will then assess whether the business meets the specific criteria for either employment or turnover growth. If the business satisfies either check, it will pass the scale up assessment. However, it is the responsibility of the applicant to ensure that its records with HMRC are accurate, up-to-date and complete. If there are gaps, the scale up assessment is likely to fail.
How to apply for a Scale Up Sponsor Licence
To apply for a scale up sponsor licence, an application must be made by completing the online application form and paying the relevant application fee to UK Visas and Immigration (UKVI), the section of the Home Office responsible for the UK’s visa system.
The prospective sponsor will first need to register online by giving UKVI a name and email address. Once registered, a user ID will be displayed which can be used to log on to the licence application system, together with a password which will be sent separately by email.
A scale up sponsor licence applicant will not normally need to send any documents in support of their application, but when completing the online form, the prospective sponsor will need to provide UKVI with the following information:
- any Companies House reference number, if the business is required to be registered with Companies House, and/or its Unique Taxpayer Reference (UTR) number
- any VAT registration number
- all relevant PAYE reference numbers through which the business pays its employees.
The provision of all PAYE reference numbers, including any settled or unsponsored workers, is required for both the necessary employment growth and turnover growth assessments. These are automated checks to confirm that the business has had at least 10 employees at the start of the three-year assessment period and whether the employment count has increased by at least 20% for this three-year period. Any failure to provide all relevant PAYE reference numbers is likely to result in an application being delayed or even refused.
If the business is subject to mandatory registration or inspection by a regulatory body, so as to operate lawfully in the UK, checks will also need to be made that the business is registered. This could include, for example, nursing or care homes regulated by the Care Quality Commission, or financial businesses regulated by the Financial Conduct Authority.
In most cases, UKVI will be able to check this information online, without the need for any documentation to be sent in support of the licence application. However, in some cases, the prospective applicant will need to provide evidence of registration and inspection.
If a UK-based business already holds a valid licence to sponsor workers, an application can be made to add the scale up route to that licence. If applying to be licensed on another route at the same time, the applicant will need to submit documents relevant to that route.
How much does a Scale Up Sponsor Licence cost?
The scale up immigration route is classed as a ‘Temporary Worker’ route for sponsor licensing purposes. This means that a prospective sponsor will only need to pay the standard Temporary Worker fee to apply for a sponsor licence of £536 (from Nov 2022). If the business is looking for an especially quick turnaround on their application, the priority service for expedited processing of sponsor licence applications is an additional £500.
A scale up sponsor will also pay the Temporary Worker fee of just £21 to assign an CoS on this route, with no Immigration Skills Charge to pay. However, a UK sponsor may want to offer to pay the application costs of any prospective new recruit to enable them to apply for a scale up visa. The cost of applying for a visa includes a £715 application fee, a £624 annual healthcare surcharge to be able to access the NHS, as well as proof of personal savings of £1270, although the sponsor can certify maintenance here.
Sponsor Licence Compliance Duties
As a scale up sponsor licence holder, there are various sponsorship responsibilities that must be met, including informing UKVI of the date a sponsored scale up worker actually starts working for the business. This must be done as soon as possible, by logging into the Home Office SMS account and using the function referred to as ‘Report migrant activity’.
During the period for which the licence holder has sponsorship responsibility for the worker in the UK, they must also tell UKVI if that person fails to start their employment, is absent from work without permission or if there are any significant changes to the nature of their role and/or salary, or to the sponsor organisation itself. However, provided the worker’s salary continues to meet the minimum requirement for their job role, the sponsor will not need assign a new CoS and the worker will not need to make a new application for permission. In contrast, if the worker’s salary is reduced below the minimum rate required, and an exception does not apply, the sponsor will need to stop sponsoring the worker, informing UKVI of this decision via the SMS account within a period of 10 working days.
Finally, the sponsor must keep records for each scale up worker that they sponsor, usually for a minimum of one year from the date on which sponsorship ends. If the sponsor fails to meet these or any of the other sponsorship duties, UKVI may revoke the sponsor licence.
The responsibilities for each sponsored worker will begin on the date that the sponsor assigns an CoS to that worker, and will continue whilst the worker’s application for either entry clearance or permission to stay is pending. If the worker is granted permission on the scale up route, they will be granted permission for two years, although the sponsor’s responsibilities will only continue for the first six months of the worker’s permission.
The six-month period during which the licence holder will have responsibility for the migrant worker is calculated in calendar months from the ‘valid from’ date on the worker’s visa or the date that they are notified they have been granted permission to stay. For example, if a scale up worker is granted entry clearance valid from 1 December 2022, the sponsorship responsibilities for that worker will run until 11:59 pm on 1 June 2023.
At the end of the six-month period, the scale up sponsor will no longer be classed as sponsoring the migrant worker, even if they continue to work for the business. No action will be needed, where sponsorship responsibility for that worker will automatically end. The worker can continue working for their existing employer/former sponsor in either the same or different employment, or they can even change employer, without having to make a new application for permission, provided they continue to meet the route requirements.
There are, of course, some downsides to the six-month rule for scale up sponsors, where a primary concern for many employers will be how this rule could impact staff retention. Employers may be reluctant to invest time and money into recruiting a highly skilled worker to help grow their business, only for that employee to leave for a new job after six months. However, once a business has a scale up sponsor licence, this will be valid for four years, where the business will able to sponsor other scale up workers during this time.
Importantly, unlike most other sponsored work routes, a scale up sponsor licence cannot be renewed beyond four years. The route was never intended to provide a long-term solution for sponsoring migrant workers, but has been designed specifically to help UK-based businesses access a wider pool of talent during a critical stage of their growth. To continue to have the option of sponsoring migrant workers after this period, the licence holder will instead need to be licensed on another route, for example, the Skilled Worker route.
DavidsonMorris are UK business immigration specialists. Our team of experts support employers to meet their talent needs through international recruitment. We advise on sponsoring workers under the Scale Up route, and provide guidance on making Scale Up Sponsor Licence applications.
Contact us for expert advice.
Scale Up Sponsor Licence FAQs
Does scale-up visa require sponsorship?
When applying for a scale-up visa for the first time, an applicant must be assigned a valid Certificate of Sponsorship from a qualifying scale up sponsor in the UK. However, to extend their visa, they can make an unsponsored application.
Who is eligible for scale-up visa?
To be eligible for a scale-up visa, an applicant must have the offer of a job from a qualifying sponsor meeting the minimum skill and salary requirements. They must also be able to meet an English language and financial requirement.
What is a scale-up sponsor?
A scale-up sponsor is a licensed UK employer in a sustained period of high turnover growth and/or employment growth, with permission from the Home Office to sponsor foreign migrants to work for their business in highly skilled roles.
How many years is scale-up visa UK?
A scale-up visa will be granted for an initial period of 2 years, although the visa-holder will only be sponsored for the first 6 months of that period. After 6 months, they are free to change jobs or change employers.