Sponsor Licence Application 2024: Step-by-Step Guide

Under the UK’s immigration rules, organisations will, in most cases, need a sponsor licence to hire non-UK skilled workers from overseas.

To make a sponsor licence application, you will need to show that your organisation has HR systems in place that comply with the sponsorship compliance duties and that the roles you are recruiting for and the workers you intend to sponsor meet the necessary requirements.

The rules and requirements for sponsoring workers are contained within the Home Office’s Sponsor Guidance document, the ‘Workers and Temporary Workers: Guidance for Sponsors’, and multiple supporting appendices.

There is a considerable amount of information for employers to work through and piece together to understand what a sponsor licence allows, how to make an application and what sponsors are required by law to do to comply with the sponsor licence duties.

In this guide, we provide detailed, practical advice on the sponsorship licence application process for employers making an application for the first time.

We will explain what the Home Office is looking for in a successful sponsor licence application. As well as dealing with preparation for the licence application, we also cover the practicalities of submitting a sponsor licence application and what to do if the licence application is approved or refused.

The sponsor licence application form itself is a relatively small part of the process. We will also examine in detail other key aspects of the process that employers may not be familiar with, but that play a crucial role in securing a sponsorship licence.

 

Section A: What is a Sponsor Licence?

 

A sponsor licence is the formal authorisation granted by the UK Home Office to a UK organisation, allowing them to sponsor non-UK nationals under certain work visa routes.

Skills and worker shortages in the post-Brexit UK labour market have made sponsor licences operationally critical for employers of all sizes across all parts of the UK economy.

Sponsor licences are an important part of the UK’s immigration system, designed to regulate and facilitate the employment of skilled workers from overseas.

The sponsorship licence grants permission to an organisation to sponsor workers in its business. Only organisations, not individuals, can be licensed ‘sponsors’.

Employers make their application for a sponsor licence to the Home Office to evidence their eligibility and prove they meet the immigration compliance requirements.

Once granted, it allows a business to issue Certificates of Sponsorship to prospective employees, enabling them to apply for a work visa under the relevant immigration category, such as the Skilled Worker route.

Sponsor licences used to be issued for four years with the requirement to apply for a renewal to retain licensed status. However, the renewal requirement was abolished in April 2024, meaning you will not need to apply to renew your licence.

 

1. UK Visa Sponsorship System

 

The Home Office relies on the sponsorship regime to prevent illegal working and misuse of the immigration system.

The sponsorship regime is used to ensure that:

 

a. The sponsor is meeting all of the compliance duties expected when sponsoring migrant workers.

b. Sponsored workers meet the points requirements and are suitably qualified and skilled with the required language skills.

c. The roles being sponsored meet the requirements for skill level, salary and genuineness.

 

By agreeing to become a sponsor licence holder, you are assuming certain compliance responsibilities and, in doing so, opening your organisation to Home Office scrutiny. Failure to meet the duties can result in enforcement action, from substantial fines to revocation of the licence, which would result in your visa workers losing their job and having to leave the country.

 

2. Sponsor Licence Benefits

 

Having a Sponsor Licence offers several benefits to employers:

 

a. Access to Global Talent: It enables businesses to recruit highly skilled workers from around the world, filling critical roles that may be hard to fill with domestic candidates alone.

b. Compliance with Immigration Laws: It ensures that businesses remain compliant with UK immigration regulations, avoiding severe penalties, including fines and potential bans from sponsoring workers in the future.

c. Competitive Edge: By securing the ability to hire the best talent globally, businesses can maintain a competitive edge in their industry.

 

3. Types of Sponsor Licence

 

In the UK, there are two main types of Sponsor Licences: the Worker Sponsor Licence, which allows businesses to sponsor skilled workers under categories like the Skilled Worker and Intra-Company Transfer visas, and the Temporary Worker Sponsor Licence, for sponsoring workers on short-term visas, such as seasonal or charity work.

 

Sponsor Licence Type	Visa Categories Covered
Worker Sponsor Licence	Skilled Worker Visa Senior or Specialist Worker Visa (Global Business Mobility) Minister of Religion Visa International Sportsperson Visa
Temporary Worker Sponsor Licence	Creative Worker Visa Charity Worker Visa Religious Worker Visa Government Authorised Exchange Visa International Agreement Visa Seasonal Worker Visa Scale-up Worker  Graduate Trainee Visa (Global Business Mobility) Service Supplier Visa (Global Business Mobility) UK Expansion Worker Visa (Global Business Mobility) Secondment Worker Visa (Global Business Mobility)

 

When applying, you will need to specify which type of licence you require.

The majority of migrant workers are sponsored under the skilled worker (formerly Tier 2 General) route, which requires a ‘Worker’ sponsor licence. This also covers workers under the Senior or Specialist Worker, Minister of Religion and International Sportsperson routes.

A separate Temporary Worker licence caters for temporary roles in the sports, charities and religious fields.

In some cases, the employer may opt to apply for both to serve its recruitment needs.

This article will focus on the skilled worker licence. While the majority of the guidance will also apply to other types of licences, there are specific requirements under each licence.

 

Section B: Who Needs a Sponsor Licence?

 

Any UK organisation that intends to employ workers who do not have valid settled status in the UK or appropriate immigration status or permission to work in the UK will need to obtain a sponsor licence. This requirement applies regardless of the size of the organisation or the number of foreign workers it plans to employ.

 

1. Types of Organisation

 

The following organisations will require a sponsor licence to sponsor foreign national workers under sponsored visa routes:

 

a. Large Corporations

Multinational companies often need to bring in specialised skills from their global offices or hire internationally to stay competitive. A Sponsor Licence is essential for these companies to facilitate the transfer of employees and the hiring of skilled workers from around the world.

 

b. Small and Medium-sized Enterprises (SMEs)

Even smaller businesses that may need to hire niche talent or specific expertise from outside the UK must obtain a Sponsor Licence. This is particularly relevant for SMEs operating in sectors where domestic skills shortages exist.

 

c. Startups

Fast-growing startups, especially those in tech or innovative industries, often seek to attract top international talent to build their teams. A Sponsor Licence enables them to hire skilled workers who can contribute to their rapid development and growth.

 

d. Educational Institutions

Universities, colleges, and other educational institutions need a Sponsor Licence to employ international academic staff and researchers. A separate sponsor licence is also required to sponsor international students under the Student visa route.

 

e. Charities and Non-Profit Organisations

Charitable organisations and NGOs that wish to employ specialists from abroad, such as fundraisers, project managers, or sector experts, require a Sponsor Licence to do so legally.

 

2. Industries

 

Certain industries are particularly reliant on the ability to hire international talent, making sponsor licence critical to recruitment programmes:

 

a. Information Technology (IT) and Technology

The tech sector is one of the most globalised industries, with companies frequently hiring software developers, engineers, data scientists, and other IT professionals from outside the UK to address skill shortages and drive innovation.

 

b. Healthcare

The UK healthcare system, including the NHS, heavily relies on foreign doctors, nurses, and other medical professionals. A Sponsor Licence is essential for healthcare providers to recruit the necessary staff to meet patient demand and maintain service quality.

 

c. Engineering and Construction

These industries often require specialised skills that are in short supply domestically. A Sponsor Licence allows companies to recruit engineers, architects, and construction managers from overseas to ensure the successful completion of projects.

 

d. Financial Services

The financial sector, particularly in London, is a global hub that attracts professionals from around the world. A Sponsor Licence is crucial for financial institutions to bring in top talent, such as analysts, traders, and compliance officers.

 

e. Hospitality and Catering

Post-Brexit, the hospitality industry has faced significant challenges in staffing. A Sponsor Licence enables hotels, restaurants, and catering businesses to hire skilled chefs, managers, and other staff from abroad to fill the gaps.

 

f. Education and Research

Universities and research institutions often require expertise that may not be readily available in the UK. A Sponsor Licence allows them to employ international academics and researchers who can contribute to their academic and scientific missions.

 

Section C: Sponsor Licence Requirements

 

The Home Office uses the sponsor licence application process to assess the employer’s ability to meet specific eligibility and suitability requirements.

There are no restrictions on the size or type of organisation that can hold a sponsorship licence, provided they meet the eligibility and suitability criteria for the specific category or tier they are applying for.

Failure to meet either the eligibility and suitability criteria will result in a refused application.

 

1. Sponsor Licence Eligibility Criteria

 

Sponsor licence applicants must meet the following criteria:

 

a. The organisation is genuine and operating and/or trading lawfully in the UK

The organisation must be a bona fide operation. Limited companies, for example, must be registered with Companies House.

There are no stipulations in the guidance that the organisation should have been trading for any particular period of time, but there should be someone resident in the UK working at the organisation who is available to liaise with the Home Office on any queries relating to the application.

Your organisation must be financially stable and capable of supporting sponsored employees. This may involve providing financial documents such as audited accounts, bank statements, or evidence of your business’s ability to pay salaries. The Home Office will assess whether your business has the financial health to fulfil its obligations as a sponsor, including paying sponsored workers at or above the required salary levels.

Your organisation must also comply with all relevant UK employment laws, including those related to working conditions, wages, and non-discrimination. This ensures that sponsored workers are treated fairly and in accordance with UK standards.

 

b. The organisation is based in the UK

Without an operating or trading presence in the UK, the application will be refused. If the organisation does not occupy premises in the UK but operates a virtual business model, it may still apply for a sponsor licence. However, it will need to clearly evidence that it can meet its sponsor duties and obligations and that it is operating or trading lawfully in the UK.

Organisations that do not have a UK presence but are looking at visa sponsorship should look at the UK Expansion Worker sponsor licence and visa, which allows overseas companies to deploy key personnel to set up UK-based operations.

 

2. Sponsor Licence Suitability Criteria

 

UKVI will look to ensure a potential sponsor meets the following:

 

a. Genuine, Qualifying Vacancy

The organisation is offering a genuine vacancy which meets the relevant visa criteria.

The job roles you intend to sponsor must meet specific skill and salary thresholds set by the Home Office. For the Skilled Worker visa, typically, roles must be classified at Regulated Qualifications Framework (RQF) level 3 or above, with a minimum salary requirement that varies depending on the role.

The Home Office may request additional information to verify the specific nature of the role and its duties and to confirm that the role actually exists. Exaggerated job descriptions to meet the skill level requirements are likely to raise suspicions that the vacancy is not genuine.

 

b. Sponsorship Compliance

The organisation has the HR and recruitment systems in place to render it capable of complying with the sponsor duties and responsibilities, and evidencing that compliance. The Home Office reserves the right to investigate sponsor compliance by conducting a site inspection before (as well as after) the licence is granted.

 

c. Is “honest, dependable and reliable”.

The organisation and its owners, directors and appointed key personnel do not have any unspent criminal convictions.

 

d. No History of Breaching Immigration Laws

The organisation does not represent a threat to immigration control with no evidence of any previous non-compliance by the organisation.

 

e. Is Licensed (as required)

If relevant, the organisation has the appropriate planning permission or Local Planning Authority consent for the type of business operated at the trading address.

 

Section D: Required Documents for a Sponsor Licence Application

 

Before starting the sponsor licence application, it will be important to prepare your bundle of supporting documents. This is arguably the most complex aspect of the application process, and it is incredibly common for employers to fall foul of the supporting documentation requirements.

 

1. Appendix A & Mandatory Documents

 

Appendix A details the documents and mandatory information to be submitted in support of a sponsorship licence application. A minimum of four mandatory documents must be submitted to demonstrate that the organisation meets the eligibility requirements, i.e. it is genuine and operating lawfully in the UK.

The guidelines can, however, become confusing and it can be difficult for employers to understand what relates to their specific application.
Appendix A comprises a number of tables which the employer must work through to determine which documents must accompany their application.

Depending on the type of organisation and how long it has been operating in the UK, the documents could include (but are not limited to):

 

a. Latest audited annual accounts

b. Employer’s liability insurance certificate

c. Certificate of VAT registration

d. Latest corporate bank account statement

e. HMRC registration evidence, such as including PAYE number and accounts office reference number

f. Evidence of ownership of, or a commercial lease for, business premises

 

While a minimum of four documents has to be submitted, it can be helpful to provide more, particularly if there is potential for the Home Office to have concerns about any of those intended to be submitted.

 

2. Additional Supporting Documents

 

As well as the four pieces of mandatory documentation, employers must also:

 

a. Explain why they are making an application for a sponsor licence

b. Specify the industry they are operating in

c. State their weekday opening and operating hours

d. Submit a current hierarchy chart detailing all owners, directors and board members

e. Submit a list of the names and job titles of all employees, if the organisation has 50 employees or fewer

f. Specify the names of everyone who has access to the email address supplied with the online sponsor licence application

g. Provide a contact (landline) telephone number

 

This information would usually be submitted within a covering letter.

In addition to the mandatory documentary evidence in relation to the organisation, if a skilled worker is being hired, the organisation will also need to provide specific information relating to the role(s) to be sponsored. This includes:

 

a. The job title and Standard Occupational Classification (SOC) Code for the role.

b. A job description detailing the duties of the role

c. Details of the skills, experience and qualifications required to perform the role.

d. The guaranteed salary if the job were vacant at the date of the sponsor licence application.

e. Details of where the role sits on the organisational hierarchy chart. The organisation must indicate which jobs are currently vacant and for which it intends to assign a Certificate of Sponsorship.

 

3. Apply by Head Office or Individual Branches?

 

Employers have a number of potential options if they need a licence to cover a network of UK-based operations:

 

a. A single sponsor licence that covers the head office and all branches in the UK.

b. A single sponsor licence that covers the head office and some UK branches.

c. The head office and each UK branch applying for their own separate sponsor licences.

d. Grouping a number of UK branches under one single sponsor licence, for example, on a regional basis.

 

The approach to take will largely be determined by practical considerations. If an organisation has a network of branches in the UK, applying for one licence will be easier and less resource-intensive to manage. However, if the Home Office takes enforcement action, the network as a whole will be affected by the sanction, while individual licences would more likely result in an investigation into the other branches in the network rather than automatic sanctions.

 

Section E: How to Apply for a Sponsor Licence

 

The Sponsor Licence application process involves demonstrating that your organisation is genuine, operates lawfully in the UK, and is capable of managing the sponsorship of international workers responsibly. The application requires businesses to provide evidence of their financial stability, HR systems, and their ability to fulfil their obligations as a sponsor.

 

1. Step-by-Step Guide of the Sponsor Licence Application Process

 

The following are the key steps in applying for a sponsor licence:

 

Table: Sponsor Licence Application Checklist

Task	Details	Completed (Yes/No)
Confirm business eligibility	Ensure your business meets all Home Office criteria
Appoint key personnel	Assign roles: Authorising Officer, Key Contact, etc.
Gather required documents	Collect financial records, HR policies, etc.
Complete online application form	Fill out and review all sections carefully
Submit supporting documents	Upload or mail necessary documents within 5 days
Pay application fee	Pay the appropriate fee based on business size
Prepare for a compliance visit	Ensure HR systems and records are up-to-date

 

Step 1: Prepare Your Business for the Application

Before you begin the application process, ensure that your business meets the eligibility criteria set by the Home Office. This includes having the necessary HR systems in place, ensuring your business is legally operating in the UK, and appointing key personnel to manage the sponsorship process.

Make sure your business meets the eligibility criteria, including the capability to manage sponsorship duties and the roles you intend to sponsor.

Assign roles such as the Authorising Officer, Key Contact, and Level 1 User within your business. These individuals will manage the Sponsorship Management System (SMS) and ensure compliance with sponsorship duties.

 

Step 2: Collate Required Documents

Collect all necessary documents that prove your business’s legitimacy, financial stability, and ability to comply with sponsorship obligations. These documents include your company’s Certificate of Incorporation, financial statements, proof of business premises, and evidence of HR systems.

Ensure all documents are up-to-date and correctly formatted. This includes ensuring that any required professional accreditations, insurance certificates, and DBS checks for key personnel are in place.

 

Step 3: Complete the Online Application Form

The Sponsor Licence application is submitted online through the UK Home Office’s website. You will need to create an account on the Sponsorship Management System to access the application form. This requires you to provide details about your organisation, the roles you intend to sponsor, and the key personnel involved in managing the licence.

While relatively straightforward, the Sponsorship Management System is an old system, and applicants are advised to save their work regularly to avoid losing any of their information.

The form will require the following:

 

a. Specify which type of licence you will be applying for

b. Contact information

c. Nominate the key personnel on the licence

d. List which supporting documents will be submitted

 

While the form can be completed with the guidance of a legal representative, the rules are clear that a relevant person from the organisation itself must ultimately’ press the button’ and submit the application to the Home Office.

 

Step 4: Pay the Application Fee

Depending on the size of your business, you will need to pay the appropriate application fee. As of now, the sponsor licence fee is £536 for small businesses and charities and £1,476 for medium and large businesses.

Once the fee has been paid, a submission sheet will be generated.

 

Step 5: Submit the Application

The online sponsor licence application form should only be submitted once the Authorising Officer is satisfied that the organisation has the necessary systems in place to comply with its sponsor duties and obligations and all of the supporting documents are in order and ready to be submitted.

Once completed, the online sponsor licence application form can only be submitted by the Authorising Officer. Legal representatives may assist the Authorising Officer in completing the draft online application form but must not submit it.

The Authorising Officer should save a copy of the submission sheet that is generated once the application is submitted, as it is not possible to obtain a further copy of it once it has been closed.

A copy of the completed and submitted online sponsor licence application should be retained for the UK organisation’s sponsor records.

 

Step 6: Submit Supporting Documents

Sponsor licence applicants should email their supporting documents to the Home Office in pdf format.

The documents have to be provided to the Home Office within five days of the application being submitted on the SMS, although this has been relaxed temporarily under emergency pandemic measures.

This is a narrow window in which to examine Appendix A, determine which tables are relevant and which documents are needed, and collate all the required information.

As such, employers are advised to prepare their supporting documentation pack in advance of completing the form and the clock starting on the 5-day deadline.

In practice, it can often take organisations a number of weeks to collate the necessary documents, which will delay the time required to obtain the sponsor licence but avoids potential issues and grounds for rejection if there are errors in the supporting documentation.

It is recommended that the supporting documentation is sent via special or recorded delivery so that the delivery can be tracked.

After submitting your application and documents, you will receive a confirmation notice from the Home Office. Keep this notice for your records.

 

Step 7: Await a Decision from the Home Office

Once your application and documents are submitted, the Home Office will review your application. This process typically takes up to 8 weeks, during which time the Home Office may conduct further checks or request additional information.

 

Step 8: Compliance Visit (if applicable)

In some cases, the Home Office may visit your business premises to verify the information provided in your application. They will check your HR systems, interview key personnel, and assess your ability to manage sponsored workers.

 

Step 9: Home Office Decision

After reviewing your application, the Home Office will notify you of their decision. If successful, you will be granted a Sponsor Licence, and your business will be added to the Register of Licensed Sponsors.

 

2. How Long Does a Sponsor Licence Take?

 

There are various stages to the sponsorship licence process, and timing is an important factor in ensuring you progress through the application correctly.

Understanding the processing timescales can also help with recruitment planning.

Generally speaking, you should allow for up to 8 weeks for the application to be processed. Processing times can usually be reduced if the application is comprehensive and correct, but at best, licence application decisions will generally be no quicker than 4-6 weeks.

Under the pre-licence priority service, licence applicants can pay an additional £500 to receive a decision on their application within ten working days. This service can be of value where the employer is concerned not to lose a candidate through protracted processing.
However, only a limited number of slots are made available each day.

Factors which can affect processing times include:

 

a. Pre-licence compliance visit

If the Home Office elects to conduct an on-site audit, the employer should be given two weeks’ notice of the date of inspection. It can take a further six to eight weeks for the inspection report to be written and the application progressed. Pre licence visits are more common among smaller employers and those organisations the Home Office consider to be ‘high risk’.

 

b. Supporting documents

The requirements for submitting supporting documents are strict, with considerable scope for error. Specific documents must be provided depending on the type of organisation that is applying, and certified copies must be certified in the prescribed manner. The documents also have to be submitted to the Home Office by post within five working days of the online application form being submitted. If not, the application will be rejected.

 

c. Availability of key personnel

The appointed Authorising Officer must be available to sign the submission sheet that will accompany the supporting documentation to be sent to the Home Office within five working days of submission of the online application form (although this has been relaxed temporarily under emergency pandemic measures).

 

d. Processing of sponsored worker’s application

Once the licence has been granted and the CoS assigned, the worker has three months to make the visa application to the Home Office. Home Office processing of this application will also need to be factored in when determining the employment start date. Decisions on overseas applications can take up to 3 weeks after the visa interview or up to five working days using the priority service.

Visa applications made in-country from within the UK can take up to eight weeks. Priority service and super priority services offer expedited processing in 5 working days or the next working day, respectively, but these may not be available due to pandemic service restrictions.

 

3. How Much Does a Sponsorship Licence Application Cost?

 

As part of the online submission process, the organisation will be required to pay the appropriate sponsor licence application fee.

The fee to apply for a sponsor licence will depend on the size and type of the organisation.

 

a. ‘Small’ business sponsor licence fee: £536

If the UK organisation has charitable status or is subject to the small companies regime per sections 381 – 384 of the Companies Act 2006. A company will usually qualify as a small company if it meets two of the following criteria in its financial year:

 

i. A turnover of not more than £10.2 million.

ii. A balance sheet total of not more than £5.1 million.

iii. It employs no more than 50 employees.

 

b. Large sponsor licence fee: £1,476

This will apply to any organisation that does not meet the criteria for, or is exempt from, the small company regime.

 

c. Additional fees

The sponsor licence application also carries a number of other related charges and fees:

 

i. Assigning the Certificate of Sponsorship – £239 per Certificate of Sponsorship for Workers, or £25 for a Temporary Worker

ii. Immigration Skills Charge – £1000 per year, per worker, or a reduced rate of £364 for smaller companies & charities

iii. Fees for the sponsored worker’s visa application

 

Section F: After You Apply for a Sponsor Licence

 

Submitting your Sponsor Licence application is a significant milestone, but it’s just the beginning of the process.

After you submit your application, the Home Office will conduct a thorough review to ensure your business meets all the necessary requirements to sponsor foreign workers.

After you submit your licence application, you can expect the following:

 

1. Acknowledgment of Submission

 

Once you submit your Sponsor Licence application and the required supporting documents, you will receive an acknowledgement from the Home Office. This acknowledgement typically includes a confirmation that your application has been received and will be processed within the standard timeframe, which is usually up to 8 weeks.

Keep the confirmation notice for your records, as it will include important information, such as your application reference number, which you may need for future correspondence with the Home Office.

 

2. Initial Review of Application and Documents

 

The Home Office will begin by conducting an initial review of your application and the supporting documents you provided. During this stage, they will check that all required information and documentation are complete and correctly submitted. They will also ensure that your business meets the basic eligibility criteria.

The Home Office will verify the authenticity and accuracy of the documents submitted, such as your Certificate of Incorporation, financial records, and HR policies. Any inconsistencies or missing documents may lead to delays or requests for further information.

 

3. Pre-Licence Compliance Visit (if applicable)

 

The Home Office has powers to undertake a compliance visit before making a decision on a sponsor licence application. The inspections are used to determine the applicant’s ability to meet the suitability requirements.

During the visit, Home Office officials will want to assess the organisation’s HR systems and can request access to documents relating to the employer’s sponsored workers. They will also want to speak with the Authorising Officer and can interview sponsored workers to verify that the role is genuine.

Applicants are not always given notice of the inspections, as such, it is advisable to prepare for the visit prior to submitting the licence application. In the event the Home Office opts to conduct a pre-licence visit, you will be well placed to pass the inspection.

Where breaches are identified during the inspection, the application can be refused.

Best practices for employers include:

 

a. Check the information on the application form and the Sponsorship Management System is correct and complete.

b. Ensure all appointed key personnel meet the suitability criteria and are trained in their roles and duties.

c. The Authorising Officer should be prepared to be interviewed by officials and to give a comprehensive and detailed insight into the organisation’s compliance systems and processes

d. Where the Home Office determines an organisation’s HR systems are not adequate to comply with the sponsor’s duties, they may refuse the licence. In preparation for the application, it is advisable to conduct an internal audit of existing HR systems to identify potential issues and breaches of the requirements, and for these to be addressed prior to applying to the Home Office.

e. Check if sponsor duties are being complied with. This includes checks at any physical addresses where the organisation’s sponsored employees would carry out their employment duties.

f. Have relevant documents ready for inspection.

g. Be cooperative, respectful and courteous towards the compliance officers.

h. Keep a note of the questions asked and the answers given, and ask for a copy of the notes taken by the compliance officers.

 

4. Further Information Requests

 

If the Home Office identifies any issues or needs additional information to assess your application, they may contact you with a request for further information or clarification. This could include providing additional documents explanations, or rectifying any discrepancies found during the initial review.

It’s crucial to respond to these requests promptly and accurately. Failure to provide the requested information within the given timeframe can lead to delays or even rejection of your application.

 

5. Decision-Making Process

 

After completing the initial review, verifying documents, and (if applicable) conducting a compliance visit, the Home Office will make a decision on your application. This decision is based on whether your business meets all the necessary requirements and whether the Home Office is confident in your ability to manage sponsorship duties responsibly.

 

6. Notification of Decision

 

The Home Office will email the organisation with their decision, either:

 

a. Licence Granted

If your application is approved, you will be granted a Sponsor Licence. You will receive a licence number and be added to the Home Office’s Register of Licensed Sponsors, allowing you to begin sponsoring foreign workers.

The notification will also include confirmation of the number of the Certificate of Sponsorship allocated and the user ID for the Level 1 user.

The authorising officer should send on the user ID to the Level 1 user, who will separately be sent a password to access and use the system.

Sponsors are advised to keep the password and user ID separately and securely and to ensure no one but the named Level 1 user accesses the system using these credentials.

 

b. Sponsor Licence Application Refused

A refused or rejected licence application will be hugely disappointing and frustrating for employers. After the effort and investment placed in the application process, without securing a licence, they are not able to proceed with their recruitment plans and may potentially lose out on a candidate who is awaiting their Certificate of Sponsorship.

The options open to you after a failed application will depend on why the application failed. The main source of information will be the Home Office decision letter.

If the application has been rejected, this means the application itself is at issue. For example, incomplete or incorrect supporting documentation may have been provided and the caseworker is unable to make a decision on the basis of what has been submitted. If the application is rejected, you do not have to wait to make a new application. However, it will be important to ensure the new application addresses the faults of the original.

If the application has been refused, you may be subject to a cooling-off period of at least six months before you can apply again.
This is because a refusal usually relates to failing to meet any of the sponsorship licence requirements. For example, if the organisation is not operating in the UK or the role does not meet the minimum salary requirement, the application will be rejected.

Our specialists are highly experienced in advising on sponsor licence application refusals, including dealing with errors by the Home Office and making new applications that resolve the initial refusal grounds.

 

Section G: Sponsor Licence Rating

 

When a UK business is granted a Sponsor Licence, it is assigned a licence rating by the Home Office. This rating reflects the business’s ability to meet its sponsorship duties and comply with UK immigration laws. The two main licence ratings are A-rating and B-rating, each with specific implications for how a business can sponsor foreign workers.

 

Table: Comparison of Licence Ratings

Aspect	A-Rating	B-Rating
Ability to Sponsor New Workers	Yes	No
Monitoring by Home Office	Standard compliance checks	Increased scrutiny, follow Action Plan
Action Plan Required	No	Yes, to regain A-rating
Consequences of Non-Compliance	Warning or downgrade to B-rating	Possible suspension or revocation of licence
Licence Privileges	Full privileges	Limited, pending improvement

 

1. Sponsor Licence A-Rating

 

An A-rating is the standard and most desirable rating for businesses holding a Sponsor Licence. This rating indicates that your business has met all the requirements set by the Home Office and is fully compliant with its sponsorship duties. It means that your business has demonstrated the ability to effectively monitor and manage sponsored workers, maintain accurate records, and report any changes in circumstances as required by immigration regulations.

With an A-rating, your business can fully exercise its sponsorship duties. This includes assigning Certificates of Sponsorship to foreign workers, allowing them to apply for visas under the relevant immigration categories.

Businesses with an A-rating are not subject to additional monitoring beyond the standard compliance checks and audits conducted by the Home Office.

An A-rating enhances your business’s reputation with the Home Office, indicating that your company is a reliable and trustworthy sponsor of foreign workers.

To maintain an A-rating, it’s important to continuously meet all sponsorship duties. This includes keeping accurate records, monitoring the visa status of sponsored workers, reporting changes promptly, and ensuring that your HR systems remain robust and compliant with Home Office standards.

 

2. B-Rating: Downgraded Sponsor Licence

 

A sponsor licence B-rating is assigned when the Home Office identifies significant issues with a business’s ability to meet its sponsorship duties. This rating indicates that your business is not fully compliant with the sponsorship requirements and that there are concerns about your ability to manage sponsored workers effectively. A B-rating is a warning that your business must take corrective action to avoid losing its Sponsor Licence altogether.

If your business is downgraded to a B-rating, the Home Office will issue an “Action Plan,” which outlines specific steps your business must take to address the issues identified. This plan comes with a fee, typically around £1,476, and includes deadlines for completing each required action.

While on a B-rating, your business can continue to sponsor existing workers, but you will not be able to sponsor new workers or assign new Certificates of Sponsorship until you have successfully upgraded back to an A-rating.

A B-rating puts your business under closer scrutiny from the Home Office, including potential follow-up compliance visits to ensure that the required improvements are being made.

To regain an A-rating, your business must complete the Action Plan within the specified timeframe. The Home Office will then reassess your business’s compliance. If the issues have been resolved satisfactorily, your licence will be upgraded back to an A-rating. Failure to meet the requirements of the Action Plan can result in the revocation of your Sponsor Licence, meaning you would lose the ability to sponsor foreign workers.

 

3. How to Avoid Sponsor Licence Downgrades

 

To avoid being downgraded to a B-rating and maintain your A-rating, it’s essential to:

 

a. Regularly Audit HR Practices

Ensure your HR systems and processes are robust and capable of meeting all sponsorship duties, including record-keeping, monitoring employee visa statuses, and reporting changes.

 

b. Train Key Personnel

Make sure the staff responsible for managing the Sponsor Licence are fully trained and aware of their responsibilities. Regular training can help prevent compliance issues.

 

c. Respond Promptly to Home Office Requests

If the Home Office requests additional information or conducts a compliance visit, respond promptly and ensure that all required documentation is available and accurate.

 

Section H: Sponsor Licence Compliance Duties

 

When applying for a sponsorship licence, the organisation is committing to adhere to certain administrative duties designed to ensure the prevention of illegal working.

Fundamentally, compliance with the duties ensures comprehensive and up to date records are maintained by sponsors that must be made available to the Home Office for inspection at any time.

The Home Office uses the licence application process to evaluate the employer’s ability to meet these sponsor duties.

The duties, as prescribed in the Home Office’s Sponsor Guidance, are as follows:

 

a. Record-keeping

b. Monitoring & reporting

c. Absence monitoring

d. Notifying the Home Office of changes in circumstances

 

1. Record-keeping

 

Sponsors must keep records relating to their sponsored workers and their right to work in the UK documentation, NI numbers (where applicable) as well as the history of and up-to-date contact details.

The employer must retain copies of documents as specified in Appendix D, such as the passport and immigration status documents, including their period of leave to remain/stay in the UK).

The sponsor must also keep records of sponsored workers’ contact details, both retaining past contact details and having a system in place to identify and update any changes in contact information.

Employment contracts should also be retained for all sponsored workers. Employers should note that the Home Office may review contract terms to ensure they are consistent with the details on the Certificate of Sponsorship assigned in relation to salary and job role.

Effective right to work checks ensure the employer does not breach the prevention of illegal working regime, by conducting document checks in the prescribed manner, and ensuring those workers with time-limited permission are subject to follow-up checks to verify continued right to work.

Failure to meet the right to work requirements can result in a financial penalty and enforcement action.

 

2. Monitoring & Reporting

 

The employer must have in place systems and processes to track and monitor sponsored employees, reporting within ten working days if the sponsored individual:

 

a. Fails to start work when expected

b. Has ten days of consecutive unauthorised absence

c. Has their contract terminated earlier than expected e.g. resignation

d. Moves into another immigration category, for example, from the skilled worker visa to indefinite leave to remain (regardless that the Home Office should have a record of this fact)

 

The sponsor also has to notify the Home Office of any reasonable concerns or evidence that a sponsored worker is in breach of the conditions of their stay in the UK.

 

3. Absence Monitoring

 

The sponsor has to ensure all sponsored employee absences are authorised and recorded, including sickness, annual leave, study leave and overseas travel. The employer should have in place and follow, an effective sickness absence procedure.

 

4. Notifying the Home Office of Certain Changes in Circumstances

 

Key personnel listed on the sponsor licence must still be employed or engaged by the sponsor, and if there have been any changes, these must be reported to the Home Office via the Sponsorship Management System.

If the organisation has moved premises, the Home Office must be notified of the change of company address. Should the Home Office wish to conduct an unannounced site inspection, they will need the correct
information to attend the correct premises.

While details of UK branches are not stored in the Sponsorship Management System, sponsors are advised to keep separate records of any changes to the organisation’s UK network, such as opening or closing branches, for clarity of which addresses are on the licence.

The same principle applies to overseas branches, subsidiary companies and linked entities. It is best practice to update UKVI each time a linked entity overseas is established or closed.

 

5. Appointing Key Personnel

 

Another important consideration when preparing your application will be who to appoint as your ‘key personnel’.

Sponsor licence holders are required to nominate individuals who will assume specific responsibilities to manage the licence in compliance with Home Office guidance. These are referred to as key personnel. The roles are:

 

a. Authorising officer

The Authorising Officer should be an individual in a senior position in the organisation with responsibility for recruitment and/or HR. They should preferably have oversight of HR processes, systems and people involved in the management and operation of the licence.

Only one Authorising Officer can be appointed at any one time, and it is essential to have an Authorising Officer in place at all times. If the Authorising Officer leaves the organisation, goes on overseas assignment, or takes a leave of absence such as maternity or sabbatical leave, someone else will need to be appointed to the role, even where on a temporary basis, to ensure continuity of cover.

 

b. Key contact

This is the person the Home Office will contact in relation to the organisation’s application and the licence on an ongoing basis. The key contact’s details are to be provided when the licence application is made.

Only one key contact can be appointed at any one time. It is possible to appoint a legal representative as the key contact, and in many cases, this may be a practical solution to enable the legal representative to have direct contact with the Home Office about the application.

 

c. Level 1 user

Level 1 users will use the Sponsor Management System to administer the licence on a day-to-day basis. Multiple level 1 users can be appointed at any one time, although it is good practice not to appoint too many to ensure accountability. During the application stage, the level 1 user must be an employee, but once granted, it is possible to appoint additional level 1 users, which can include a legal representative.

 

d. Level 2 user

Similar to level 1 users, level 2 users are appointed to carry out administrative tasks on the licence, albeit with fewer permissions than level 2 users.

 

Table: Sponsorship Management System (SMS) User Roles

Role	Responsibilities	Key Requirements
Authorising Officer	Overall responsibility for SMS and compliance	Senior employee with authority and trustworthiness
Key Contact	Main liaison with the Home Office	Knowledgeable and accessible for all communications
Level 1 User	Day-to-day management of the SMS	Must be trained on SMS and sponsorship rules
Level 2 User	Limited access, can perform specific tasks	Assigned as needed, less responsibility than Level 1

 

The key personnel must be nominated within the licence application form.

To allow for smaller employers, it is possible for the same person to hold multiple roles, while larger companies may opt to appoint different people. In most cases, the key contact, for example, is likely to also act as a level 1 user.

The sponsor must always have a minimum of one employee who is a “settled worker” i.e. a worker who is not subject to immigration control and therefore does not have restriction on their stay in the UK).

The employer has to ensure those appointed as key personnel meet the suitability requirements, as prescribed under the official sponsor guidance.

Each of the key personnel must:

 

a. Be permanently based in the UK throughout the duration of their role.

b. Be a paid staff member or engaged by the UK organisation as an officeholder, with some exemptions which, for example, allow legal representatives to be appointed to certain key personnel roles.

c. Not have an unspent criminal conviction for a relevant immigration offence.

 

Sponsor Management System users cannot sponsor close relatives such as their spouse, partner, brother, sister, father, mother, etc.

Sponsored employers cannot act as Level 1 users with the ability to assign Certificates of Sponsorship to sponsored employees.

Each individual key personnel will be subject to criminal background checks to verify if they have been associated with immigration offending or with sponsor licence enforcement.

 

6. Sanctions for Non-Compliance

 

The sponsor licence duties are an ongoing concern for licence holders. During the pre-licence application stage, if the Home Office is not satisfied that the duties can be met, the application will be refused. If the licence is granted, the Home Office has powers to inspect sponsors at any time, and without notice. Where compliance breaches are identified, the Home Office can take enforcement action against the sponsor by downgrading the licence, suspending or even revoking the licence.

With a suspended licence, your sponsored workers can continue to work for you, but you cannot assign a certificate of sponsorship to a new employee, and you will need to respond to the Home Office within 20 days to put forward your case as to why the licence should be reinstated. This will require extensive preparation to collate evidence and identify a correction plan within the timeframe. The Home Office can then decide to reinstate the licence, downgrade it or revoke it if the compliance breaches are substantial.

 

Table: Penalties for Non-Compliance

Non-Compliance Issue	Potential Penalty	Impact on Licence
Failure to report changes	Downgrade to B-rating or suspension	Reduced ability to sponsor new workers
Employing illegal workers	Fine up to £45,000 per worker for a first breach, or £60,000 for repeat breaches	Potential revocation of licence
Inadequate record-keeping	Warning or B-rating	Increased scrutiny and requirement for Action Plan
Misuse of Certificates of Sponsorship	Licence suspension or revocation	Immediate halt to all sponsorship activities
Non-compliance during a visit	Licence suspension, downgrade, or revocation	Possible legal and reputational consequences

 

A revoked licence will be severely disruptive to operations. You will no longer be able to lawfully employ your sponsored workers, whose visas will be curtailed, requiring them to find new sponsorship or leave the country within strict timeframes.

The organisation will usually have to wait at least 12 months before they can apply for a new licence.

It is not possible to appeal a decision to revoke a licence, but where certain issues are present, it may be possible to challenge the decision through the Judicial Review process. We have specialist experience in Judicial Review proceedings and strategies to avert such action and resolve disputes with the Home Office through more collaborative means.

In addition to punitive measures impacting the sponsorship licence, where duties under the prevention of illegal working regimes have been breached, this can result in a substantial fine.

 

Section I: Top 10 Sponsor Licence Application Tips

 

To increase your chances of approval, follow these tips from our sponsor licence experts:

 

1. Assess Your Organisation’s Eligibility

Before you embark on the licence application process, first ensure that your organisation meets all the eligibility criteria set by the Home Office. This includes having a genuine need to sponsor workers, being legally established in the UK, and having robust HR systems in place to manage sponsorship duties.

Conduct an internal audit of your HR systems, financial stability, and operational status to ensure your business meets all the necessary criteria. Address any gaps or weaknesses before submitting your application.

 

2. Appoint Competent Key Personnel

The success of your Sponsor Licence application largely depends on the key personnel you appoint to manage the Sponsorship Management System. These roles include the Authorising Officer, Key Contact, and Level 1 User. Ensure these individuals are experienced, trustworthy, and fully understand their responsibilities.

Choose individuals who meet the eligibility criteria and have a strong understanding of your organisation’s operations and compliance requirements. Provide adequate training on their roles and the use of the Sponsorship Management System to ensure they can manage sponsorship duties effectively.

 

3. Prepare and Organise Required Documentation

One of the most common reasons for sponsor licence application delays or rejections is incomplete or incorrectly submitted documentation. The Home Office requires a range of documents to verify your business’s legitimacy and ability to comply with sponsorship duties.

Create a detailed checklist of all required documents, including proof of business registration, financial records, HR policies, and key personnel information. Ensure all documents are up-to-date, accurate, and properly formatted. It’s also advisable to keep copies of all submitted documents for your records.

 

4. Demonstrate Robust HR and Recruitment Systems

The Home Office will scrutinise your HR and recruitment systems to ensure that your business can effectively monitor and manage sponsored workers. This includes keeping accurate records, conducting right-to-work checks, and reporting any changes in workers’ circumstances.

Implement and document clear HR policies and procedures that comply with UK immigration laws. Consider using HR software to track visa statuses, record-keeping, and reporting obligations. During the application process, be prepared to demonstrate how your HR systems support compliance.

 

5. Provide Accurate Information on the Application Form

The application form is a critical component of your Sponsor Licence application. Providing clear, accurate, and consistent information is essential to avoid any misunderstandings or red flags that could delay the processing of your application.

Double-check all information entered on the application form, ensuring it matches the details in your supporting documents. Avoid leaving any sections incomplete, and provide detailed explanations where required. It’s often beneficial to have another team member or a legal advisor review the form before submission.

 

6. Prepare for a Compliance Visit

The Home Office may conduct a compliance visit to assess your business’s readiness to sponsor foreign workers. Being unprepared for such a visit can negatively impact your application.

Prepare for a possible compliance visit by ensuring your business premises, HR records, and key personnel are ready for inspection. Conduct mock audits and internal reviews to identify and address any potential issues before the Home Office visit.

 

7. Respond Promptly to Requests for Additional Information

During the review process, the Home Office may request additional information or clarification regarding your application. Delays in responding can lead to longer processing times or even rejection of your application.

Assign a dedicated point of contact within your business to handle all communications with the Home Office. Ensure that any requests for additional information are addressed promptly and thoroughly to avoid delays.

 

8. Take Professional Advice

The Sponsor Licence application process can quickly be complex, and even small mistakes can lead to significant setbacks. If you’re unsure about any aspect of the process, seeking professional advice can be invaluable.

DavidsonMorris specialises in Sponsor Licence applications, providing expert guidance to applicants on their eligibility, compiling their application and documents and helping ensure that everything is in order before submission.

 

9. Plan for Ongoing Compliance

Securing a Sponsor Licence is not a one-time task; it requires ongoing compliance with the Home Office’s requirements. Failing to maintain compliance can result in penalties, including suspension or revocation of your licence.

Develop a compliance plan that includes regular audits of your HR systems, training for key personnel, and clear procedures for monitoring and reporting sponsored workers. This proactive approach will help you maintain your A-rating and avoid potential compliance issues.

 

10. Use the Priority Service If Required

The standard processing time for a Sponsor Licence application is up to 8 weeks, but in some cases, you may need to secure your licence more quickly. The Home Office offers a priority service for an additional fee, which can expedite the process.

If time is a critical factor, consider using the priority service to have your application processed within ten working days. Ensure that all your documentation is in perfect order, as expedited services require complete and accurate submissions.

 

Section J: Using Your Sponsor Licence

 

A sponsorship licence will only be granted where the Home Office is satisfied that there is an offer of genuine employment that meets the skilled worker visa requirements. This will be more easily established if there is an identifiable candidate, and it can be shown that they and the role they are being hired to do meet the criteria.

 

1. Sponsoring a Skilled Worker Visa Applicant

 

Under the UK’s points-based immigration system, the main route for non-UK residents working in the UK is the Skilled Worker visa.

To employ workers under this route, the employer must apply to the Home Office for a Worker sponsor licence.

Only eligible roles can be sponsored under the skilled worker licence.
There are skill and salary levels that must be met, and certain sectors and niches are excluded.

Any proposed sponsored role must meet the criteria for sponsorship and attain the requisite 70 points under the visa route. This includes skill, salary and language requirements, as follows:

 

Mandatory points requirements	Points
Sponsorship	20
Job at an appropriate skill level	20
English language skills at level B1 (intermediate)	10

 

The points requirement for the skilled worker visa allows applicants to trade certain points. For example, it may be possible to trade a salary level lower than the applicable threshold, provided additional points are attained under another attribute.

 

Option	Requirements	Points
A	The applicant’s salary equals or exceeds both: • £38,700 per year; and • the going rate for the SOC 2020 occupation code.	20
B	The applicant has a PhD in a subject relevant to the job and their salary equals or exceeds both: • £34,830 per year; and • 90% of the going rate for the SOC 2020 occupation code.	20
C	The applicant has a PhD in a STEM subject relevant to the job and their salary equals or exceeds both: • £30,960 per year; and • 80% of the going rate for the SOC 2020 occupation code.	20
D	The applicant is being sponsored for a job on the Immigration Salary List and their salary equals or exceeds both: • £30,960 per year; and • the going rate for the SOC 2020 occupation code	20
E	The applicant is a new entrant at the start of their career and their salary equals or exceeds both: • £30,960 per year and • 70% of the going rate for the SOC 2020 occupation code.	20
F	The applicant’s salary equals or exceeds both: • £29,000 per year; and • the going rate for the SOC 2020 occupation code.	20
G	The applicant has a PhD in a subject relevant to the job and their salary equals or exceeds both: • £26,100 per year; and • 90% of the going rate for the SOC 2020 occupation code.	20
H	The applicant has a PhD in a STEM subject relevant to the job and their salary equals or exceeds both: • £23,200 per year; and • 80% of the going rate for the SOC 2020 occupation code.	20
I	The applicant is being sponsored for a job on the Immigration Salary List and their salary equals or exceeds both: • £23,200 per year; and • the going rate for the SOC 2020 occupation code.	20
J	The applicant is a new entrant at the start of their career and their salary equals or exceeds both: • £23,200 per year; and • 70% of the going rate for the SOC 2020 occupation code.	20
K	The applicant is being sponsored for a job in a listed health or education occupation and their salary equals or exceeds both: • £23,200 per year; and • the going rate for the SOC 2020 occupation code.	20

 

To qualify for the skilled worker visa, the role will, in most cases, need to be at Regulated Qualifications Framework (RQF) level 3 (A level equivalent) or above.

 

2. Matching Roles to SOC Codes

 

Jobs that are eligible under the skilled worker route are listed in Appendix Skilled worker and identified by a Standard Occupational Classification (SOC) code and ‘related job titles’.

As well as the SOC code, the Appendix provides a brief job description and example job tasks to help employers match roles to the correct SOC code.

Likewise, job descriptions which copy the example job tasks verbatim can also raise suspicions as to the genuineness of the role and its alignment to the selected SOC code.

If you are unsure as to which SOC code is correct, it can be helpful to use the ONS coding tool and search by job title. You can then cross-reference the code provided with the Home Office Appendix to confirm the SOC code is correct.

You will then be able to check the RQF level assigned to the role and whether this meets the required minimum level for the route.
The requirements can be said to be met where the visa applicant is not educated to the required RQF level but can evidence relevant job experience. However, where a visa applicant has neither the requisite qualifications nor relevant work experience, the Home Office is likely to refuse the sponsorship licence application and/or the worker’s visa application for failing the genuine vacancy test.

Certain roles are exempt from the skill level requirement, including those that feature on the Immigration Salary List.

 

3. Skilled Worker Visa Minimum Salary

 

One of the key sponsorship requirements is that the salary you pay sponsored workers must be above a certain minimum threshold.
Unfortunately for employers, this is not a straightforward area of the licence since different minimum salary levels apply to different types of workers.

In effect, the applicable threshold will depend on factors such as the job role and whether the worker is classed as a new entrant or an experienced worker.

The employer has to pay whichever is the higher of the ‘going rate ‘ or the relevant general minimum salary threshold.

In some circumstances, the applicable minimum salary to attain the 20 points is a lower threshold. This would apply, for example, if the individual has a STEM PhD relevant to the role or if the job features on the Immigration Salary List.

 

4. New Entrant to Experienced Worker

 

The sponsor guidance states that a sponsored worker can only be considered a ‘new entrant’ for a maximum of three years, regardless of their circumstances.

Sponsors should plan for any future increase in the applicable minimum salary should the worker ‘transition’ during the course of their employment.

 

5. How to Assign Certificates of Sponsorship

 

The Certificate of Sponsorship is a reference number issued by a sponsoring employer via the Sponsorship Management System to their prospective sponsored worker. The CoS is used to verify to the Home Office that the requirements under the visa route have all been met.
Sponsored visa applicants need the Certificate of Sponsorship to make their visa application.

The two types of Certificate of Sponsorship are Defined and Undefined Certificates of Sponsorship:

 

a. Defined Certificate of Sponsorship

If the prospective employee is outside the UK and will be applying for entry clearance, they will need to be assigned a defined Certificate of Sponsorship. The sponsor will need to apply for the defined Certificate of Sponsorship via the Sponsorship Management System by providing details of the specific job and salary.

 

b. Undefined Certificate of Sponsorship

If the individual is applying for a skilled worker visa to remain in the UK, the sponsor will assign them an undefined Certificate of Sponsorship out of their annual allocation. If the organisation has used its full year’s allocation, it can apply for additional undefined Certificate of Sponsorship through the Sponsorship Management System. The Home Office is currently advising there will be a one-day turnaround time for requests unless there are additional queries.

Sponsors will need to understand the difference between the two types and ensure they assign the correct one that is relevant to the worker.
Failure to assign the correct type of Certificate of Sponsorship is a breach of the guidelines and can result in penalties against you. For example, sponsors are not permitted to assign an undefined Certificate of Sponsorship where a defined Certificate of Sponsorship is required or a defined Certificate of Sponsorship to a worker for any job other than the one detailed in the Certificate of Sponsorship application.

Once assigned a Certificate of Sponsorship, the individual must use this reference number to make their Home Office visa application.

After three months, the visa application may be rejected if it is made more than three months after the Certificate of Sponsorship allocation date or refused if the application is made more than three months prior to the employment start date as recorded on the Certificate of Sponsorship.

 

6. Applying for Certificates of Sponsorship

 

Within its sponsor licence application, the UK organisation will need to state how many undefined Certificates of Sponsorship it will require until the end of the Certificate of Sponsorship allocation year.

This means that if the licence is granted, the Certificates of Sponsorship will also be issued to you at the same time, enabling you to assign Certificates of Sponsorship straight away to the individual in order for them to make their Home Office visa application.

It is helpful for employers to consider their recruitment needs for the coming 12 months and to request an annual allocation of Certificates of Sponsorship that will see them through the year, although additional Certificates of Sponsorship can be requested through the Sponsorship Management System as and when required.

 

Section K: Summary

 

A Sponsor Licence is a mandatory requirement for UK employers who wish to hire non-UK resident workers. The licence, granted by the Home Office, enables businesses to sponsor skilled workers, allowing them to apply for a work visa.

Through the sponsor licence application process, employers must demonstrate that their business is legitimate, has the necessary HR systems in place to manage sponsored workers, and meets specific eligibility criteria.

Employers will also need to consider the financial and administrative responsibilities involved, as the licence comes with ongoing compliance duties, such as maintaining accurate records and reporting changes in workers’ circumstances to the Home Office. Non-compliance can lead to significant risks, including licence suspension or revocation, fines, and reputational damage.

 

Section L: Need Assistance?

 

While applying for a sponsor licence has become a mandatory prerequisite for employers recruiting non-UK resident workers from overseas, the UK immigration rules remain complex, demanding and costly for employers bringing talent to the UK.

At DavidsonMorris, our goal is to simplify the Sponsor Licence application process for you, minimising risks and ensuring that your organisation can successfully recruit and retain international talent.

We provide clients with a complete employer sponsorship licence application service, with our team of UK immigration specialists highly experienced in all the documentary and evidentiary requirements vital to a prompt and stress-free process when applying for a sponsor licence. We also provide guidance on best practices in managing the licence and avoiding enforcement issues. For guidance on applying for a sponsor licence, contact us.

We have particular expertise in complex applications involving group organisations, time pressures and taking on previously refused applications. The Home Office notification is not always clear in identifying the grounds for a failed application.

With our experience in licence applications, we can assess the original application and determine areas to be addressed and how to rectify these in preparation for a new or amended application. We can also identify if there have been factual errors made on the part of the Home Office and how to rectify this. We can advise you on the approach that will be in your best interests in terms of processing times, cost, and prospect of success.

 

Section M: Sponsor Licence Application: FAQs

 

What is a Sponsor Licence?
A sponsor licence grants permission to a UK employer to sponsor overseas skilled workers. Employers must make an application to the Home Office to prove their eligibility and prove they meet the strict sponsorship compliance requirements.

 

Who needs a Sponsor Licence?
UK organisations looking to employ foreign national workers will, in most cases, need a Sponsor Licence. This includes companies of all sizes across various industries, such as healthcare, IT, engineering, finance, and education.

 

How much does it cost to apply for a sponsorship licence?
Small businesses and charities pay a sponsor licence application fee of £536, while all other organisations pay £1,476. As well as the application fee, the sponsor will also have to pay the Immigration Skills Charge (£1000 per year per sponsored worker for larger employers) and pay £239 to issue each Certificate of Sponsorship to Workers, or £25 per CoS to Temporary Workers.

 

How long does it take to get a Sponsor Licence?
The standard processing time for a Sponsor Licence application is up to 8 weeks. However, if you need a faster decision, you can opt for the priority service, which, if available, can process your application within ten working days for an additional fee of £500.

 

What documents do I need to submit with my Sponsor Licence application?
Sponsor licence applicants will need to refer to Appendix A of the Home Office’s sponsor licence guidance, which details the mandatory documents to be provided with the licence application.

 

What happens if my Sponsor Licence application is refused?
If your application is refused, the Home Office organisation reasons for the refusal. You may be able to request an administrative review of the decision, depending on the reasons given. Alternatively, you may need to address the issues identified and reapply after a cooling-off period, typically six months.

 

What are the ongoing responsibilities after obtaining a Sponsor Licence?
Once you have a Sponsor Licence, you must comply with various ongoing obligations, including keeping accurate records of sponsored workers, monitoring their immigration status and reporting any changes and reporting any significant changes in your business or the sponsored workers’ circumstances to the Home Office.

 

What are the consequences of non-compliance with sponsorship duties?
Non-compliance can result in serious penalties, including downgrading of your Sponsor Licence from an A-rating to a B-rating, suspension or revocation of your licence, which could prevent you from sponsoring new workers and may lead to the loss of your existing sponsored workers’ right to work in the UK. Financial penalties, such as fines for employing illegal workers, can also be imposed.

 

Can I sponsor a worker for any type of job?
No, the job roles you sponsor must meet specific skill and salary thresholds set by the Home Office. Typically, these roles must be at RQF Level 3 or above (equivalent to A-level) and meet the minimum salary requirements for the specific visa category.

 

How long does a sponsor licence last?
Since 6 April 2024, sponsor licences do not expire unless they are withdrawn or revoked. As such, there is no longer a requirement to renew a sponsor licence.

 

How do you become a Tier 2 sponsor?
To become a Tier 2 sponsor, an organisation has to make an application to the Home Office for a sponsorship licence, evidencing that they meet the requirements and pay the application fee.

 

Section N: Key Statistics & Trends

 

The following are recent key statistics and trends relating to sponsor licence applications:

 

1. Increase in Sponsor Licence Applications Post-Brexit

In the first quarter of 2021, the number of Sponsor Licence applications increased by over 50% compared to the same period in 2020.

Since the end of the Brexit transition period on 31 December 2020, there has been a significant increase in the number of UK businesses applying for Sponsor Licences. This surge is largely due to the fact that employers now need a Sponsor Licence to hire workers from the European Union and European Economic Area, which was not required before Brexit.

 

2. Sectoral Growth in Sponsor Licence Applications

The healthcare sector has experienced a 30% increase in Sponsor Licence applications, reflecting the growing demand for overseas healthcare professionals due to workforce shortages exacerbated by the COVID-19 pandemic.

Certain sectors have seen particularly high growth in Sponsor Licence applications, driven by skills shortages and the need for specialised talent. These sectors include healthcare, technology, and finance.

 

3. Sponsor Licence Approval Rates

In 2022, approximately 9 out of 10 Sponsor Licence applications were approved by the Home Office, indicating a generally favourable environment for compliant businesses.

The approval rate for Sponsor Licence applications remains high, typically around 90%. However, businesses with incomplete applications or insufficient HR systems are more likely to face rejections.

 

4. Impact of the Immigration Skills Charge

Since the introduction of the ISC, it is estimated that businesses have paid over £200 million in charges, with healthcare and technology sectors contributing significantly due to their reliance on skilled overseas talent.

The introduction of the Immigration Skills Charge (ISC) has influenced the cost of hiring overseas workers, particularly affecting small and medium-sized enterprises (SMEs). This charge is intended to encourage UK employers to invest in training the domestic workforce.

 

5. Regional Variations in Sponsor Licence Applications

In 2022, over 40% of all Sponsor Licence applications were from businesses based in London, reflecting the city’s status as a global business hub.

There is a regional variation in the number of Sponsor Licence applications, with London and the South East of England leading due to the concentration of international businesses and industries with high demand for overseas talent.

 

6. Small Businesses and Sponsor Licence Uptake

Between 2021 and 2023, there was a 25% increase in Sponsor Licence applications from businesses with fewer than 50 employees.

Small businesses have increasingly been applying for Sponsor Licences, particularly in sectors like hospitality, where there are significant labour shortages.

 

7. Economic Contribution of Sponsored Workers

In 2023, sponsored workers accounted for approximately 5% of the UK workforce, with a particularly high concentration in sectors like healthcare, IT, and finance.

Sponsored workers contribute significantly to the UK economy, filling critical roles across various sectors that are experiencing skills shortages.

 

8. Employer Concerns and Compliance Challenges

According to a 2022 survey, 60% of businesses with a Sponsor Licence cited compliance costs and administrative burdens as significant challenges.

Many UK businesses express concerns about the complexity of compliance requirements associated with holding a Sponsor Licence, including the costs of maintaining compliance and the potential for penalties.

 

Section O: Glossary

 

Term	Definition
Sponsor Licence	A permission granted by the UK Home Office allowing businesses to employ workers from outside the UK and EEA.
Certificate of Sponsorship (CoS)	A virtual document issued by a sponsor to a foreign worker, enabling them to apply for a UK work visa.
Sponsorship Management System (SMS)	The online platform used by licensed sponsors to manage their Sponsor Licence and sponsored workers.
Authorising Officer	A senior individual in a business responsible for overseeing the SMS and ensuring compliance with sponsorship duties.
Key Contact	The main liaison between the sponsor and the Home Office regarding the Sponsor Licence.
Level 1 User	The person responsible for day-to-day management of the SMS, including assigning CoS and reporting changes in sponsored workers’ circumstances.
Right to Work Check	A check conducted by employers to ensure that an employee has the legal right to work in the UK.
Immigration Skills Charge (ISC)	A levy imposed on sponsors when hiring workers under certain visa categories, intended to fund skills training for the UK workforce.
A-Rating	The standard rating for a Sponsor Licence, indicating full compliance with Home Office requirements.
B-Rating	A downgraded rating indicating that the sponsor has compliance issues and must follow an Action Plan to regain an A-rating.
Action Plan	A set of corrective measures issued by the Home Office that a B-rated sponsor must complete to regain an A-rating.
Compliance Visit	An inspection by the Home Office to assess a sponsor’s adherence to their duties and the accuracy of their application.
Cooling-Off Period	A period of six months during which a company cannot reapply for a Sponsor Licence following a refusal or revocation.
Revocation	The cancellation of a Sponsor Licence by the Home Office due to serious non-compliance with sponsorship duties.
Suspension	A temporary halt to a sponsor’s ability to assign new CoS or sponsor new workers, typically while the Home Office investigates compliance issues.
UK Visas and Immigration (UKVI)	The division of the Home Office responsible for managing immigration, including the processing of visa and sponsorship applications.
Regulated Qualifications Framework (RQF) Level	A system used in the UK to classify qualifications based on their difficulty and the skills required, with Level 3 equivalent to A-levels.
Biometric Residence Permit (BRP)	Prior to 31 December 2024, a card issued to foreign nationals in the UK that includes their biometric information (such as fingerprints) and visa details. BRPs have been replaced by eVisas as digital proof of immigration status.
Civil Penalty	A financial fine imposed by the Home Office on employers for breaches of immigration law, such as employing someone without the right to work.

 

Section P: Additional Resources

 

UK Government: Sponsor a Skilled Worker
https://www.gov.uk/uk-visa-sponsorship-employers
This official UK government resource provides detailed guidance on how to sponsor a skilled worker, including eligibility requirements, application steps, and ongoing compliance obligations.

 

UK Home Office: Sponsorship Policy Guidance
https://www.gov.uk/government/collections/sponsorship-information-for-employers-and-educators
This collection of guidance documents from the Home Office covers various aspects of sponsorship, including employer responsibilities, the Sponsorship Management System, and compliance.

 

Chartered Institute of Personnel and Development (CIPD): Guide to Sponsoring Overseas Workers
https://www.cipd.co.uk/knowledge/fundamentals/emp-law/employees/sponsoring-overseas-workers
CIPD offers an informative guide for HR professionals on the processes and considerations involved in sponsoring overseas workers, including tips for ensuring compliance and managing sponsored employees.

 

UK Visas and Immigration (UKVI): Right to Work Checks
https://www.gov.uk/government/publications/right-to-work-checks-employers-guide
This guide from UKVI provides employers with the necessary steps to conduct right-to-work checks, a critical component of maintaining compliance with immigration laws when employing foreign workers.

 

Law Society of England and Wales: Immigration and Asylum Law
https://www.lawsociety.org.uk/topics/immigration
The Law Society offers resources and guidance on immigration and asylum law, including information on Sponsor Licences and the legal obligations of UK employers.

 

Office for National Statistics (ONS): Labour Market Overview
https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/uklabourmarket/latest
The ONS provides comprehensive data on the UK labour market, including trends in employment that can inform your understanding of the demand for skilled workers and the importance of securing a Sponsor Licence.

 

UK Government: Immigration Rules – Appendix A (Attributes)
https://www.gov.uk/guidance/immigration-rules/immigration-rules-appendix-a-attributes
This section of the UK Immigration Rules details the points-based system and the attributes required for different types of work visas, essential for understanding the requirements your business must meet when sponsoring workers.

 

Gov.UK: Preventing Illegal Working – Code of Practice
https://www.gov.uk/government/publications/prevent-illegal-working-in-the-uk
This code of practice outlines employers’ legal responsibilities in preventing illegal working, including conducting right-to-work checks and understanding the penalties for non-compliance.