- 13 minute read
- Last updated: 7th January 2020
With domestic skills shortages across the UK economy, employers in Britain are looking to the global talent market to meet their recruitment needs. But to employ skilled non-EEA workers, UK employers first have to apply for sponsor licence. A refusal rate of 15%, however, suggests employers are struggling to get the application process right.
This article covers:
- What is a sponsor licence?
- Before applying for a sponsor licence
- Appointing key personnel
- Compile your application & supporting documentation
- Prepare for a UKVI inspection
- Sponsor licence management
- Resident labour market test
A sponsor licence is the permission granted by the Home Office to an employer to hire skilled nationals from non-EEA countries under the Tier 2 visa route. Employers must make an application to UKVI to evidence their eligibility and that they meet the strict requirements on sponsors.
The application process requires applicants to demonstrate that:
- You are a genuine organisation operating lawfully in the UK.
- You have effective HR and recruitment systems and practices in place.
- You are offering genuine employment that meets the Tier 2 skill level and appropriate rates of pay.
- Your appointed key personnel, as identified in your application, are honest, dependable and reliable.
There are also rising costs associated with this visa which employers need to have a full grasp of.
If you are considering applying for a sponsor licence, you want to improve the prospects of the Home Office approving your application. Answering the following questions will help you to build a compelling submission that is compliant with the requirements on sponsor licence holders.
When you apply for a sponsor licence you will need to specify the types of workers you are looking to recruit:
- Tier 2 workers: Skilled workers with long-term job offers.
- Tier 5 workers: Skilled temporary workers.
Since sponsor licences are granted for four years, it will require you to consider your current and longer-term recruitment needs when making your application what to ensure the licence provides sufficient cover for the duration of its validity.
You then need to consider how you will use the sponsor licence.
There are two options available – the unrestricted Certificate of Sponsorship (CoS) and the restricted CoS.
Unrestricted CoS are used for new employees with a salary of more than £159,600 or more switching within the UK to the Tier 2 (General) visa and extensions.
When you apply for your licence you will be asked to estimate how many Tier 2 certificates you will require. You will then be granted fixed allocations of unrestricted CoS on a yearly basis as part of your sponsor licence.
You must issue the unrestricted CoS to the overseas worker within three months of allocation and within six months of first advertising the vacancy.
Individuals must then apply to UKVI for Tier 2 clearance within three months of receiving the CoS.
Restricted CoS are intended for new employees applying from outside the UK to enter under a Tier 2 (General) visa and who will be earning under £159,600 per annum, and individual dependants of Tier 4 students applying from the UK wishing to switch to a Tier 2 (General) visa.
There is an annual restriction in place on the number of migrant workers admitted to the UK from outside the EU under a Tier 2 (General) visa on restricted CoS.
UKVI review all applications for restricted CoS on a monthly basis. Those requests which meet the points criteria (minimum 32 points) are approved. If the restrictive allocation limit is oversubscribed, applications are prioritised according to a points table.
The available restricted CoS are allocated based on the highest points scored. Points are awarded based on whether the job is in a shortage occupation, a PhD-level occupation, and the salary on offer.
There are no guarantees if and when restricted CoS applications will be approved.
If a CoS is granted, the employer assigns the CoS to the individual, who can then use the reference number to apply to the Home Office for entry permission.
Any restricted CoS unallocated after three months will be automatically returned to UKVI for reallocation.
As a sponsor licence holder, you are required to nominate individuals within your organisation to carry out particular administrative functions – so-called ‘key personnel’:
Once you have been granted a licence you can also choose to nominate individuals as Level 2 users.
When applying for a sponsor licence, it is important to understand the purpose of each of these roles and who you can – and critically cannot – appoint. Those nominated and identified within the application will be subject to a background check by UKVI.
You must also ensure there is an appointed Authorising Officer and at least one Level 1 user in place at all times. If the appointed personnel leave the organisation and there is a failure to appoint someone else to the role, UKVI has powers to downgrade your licence and charge for the opportunity to upgrade it again, or even revoke your licence altogether.
To apply for a sponsor licence you must write and submit an online application. Preparation is essential.
In support of your online application, you must collate and submit supporting documentation to meet the necessary evidentiary requirements. The documents you will need to provide, as a minimum, to prove your eligibility are detailed in the Home Office’s Appendix A. While some documents will be mandatory, in most cases we recommend providing further documents to evidence comprehensively that the organisation meets all of the requirements under the sponsor licence.
The relevant supporting documents must be supplied within five days of the initial application. Failure to submit all required documents will result in your application being delayed or rejected, and further costs being incurred. As such, it will be important to have prepared all of the necessary evidence and documentation by the time you make your application online.
Following receipt of your application, you may be subject to a compliance visit from UK Visas and Immigration. The purpose of a Home Office inspection is to ascertain whether you have adequate HR systems in place to meet the sponsor licence requirements and to assess whether or not to grant the licence.
An audit of your HR operations will be key in preparing for a site visit, to identify process weakness or omissions that could impact your licence application.
Applying for a sponsor licence is only the first hurdle for employers in accessing the global talent market. If you are successful in your application, there is no room for complacency as your HR processes must kick-in and support ongoing compliance with your duties as sponsor licence holder.
UK immigration rules are also subject to constant change and revision, making it critical that sponsor licence holders stay up-to-date and compliant with their duties.
Sponsor licence holders are required to meet a number of compliance duties for the duration of their licence. These duties require internal HR processes, policies and procedures to meet the required standards in the following areas:
- Keeping up-to-date records of all foreign workers
- Tracking and recording employee attendance
- Reporting certain employee activities, such as non-attendance or non-compliance
- Cooperating with the Home Office, such as during site visits
- Complying with the law, such as carrying out right to work checks on employees to ensure that they are entitled to be in the UK and undertake the work in question.
Some duties appear more widely understood than others. The duty to notify a change in circumstances is, for example, often overlooked in practice, particularly where wider organisational concerns demand attention and focus, such as a merger or acquisition or other organisational change.
Another common area of compliance risk is lack knowledge of personnel involved in the sponsor licence, across the recruitment, onboarding and staff management stages. Training is likely to be required to ensure relevant knowledge and internal capability internally across HR, line managers and site managers.
Penalties for failing to comply with sponsor licence duties are designed to impact operations to deter employers from falling short in their obligations. Failure to comply with your licence compliance duties can result in a downgrade in user rating, a licence suspension or revocation – putting the jobs of existing migrants at risk and impacting your organisation’s operations.
Ongoing compliance management will also pay dividends when it comes to renewing the licence – which is typically more of a complex process than the initial application. All too often we see at the sponsor licence renewal stage after four years that processes have slackened, creating business-critical risk of licence refusal where UKVI see serious errors or breaches in compliance.
In addition to the new administrative burdens of the sponsor licence, you will also continue to be required to meet your illegal working duties under the Right to Work regime. The requirements state that all employees are required to provide documentation that proves their right to work before being employed by a UK company and copies of this information must also be retained by the employer.
Once you are granted a sponsor licence, you must evidence that the domestic labour market has not been able to fulfil the position before you recruit from overseas, by using the Resident Labour Market Test (RLMT).
Understanding your duties under the RLMT is important, and specifically what this means for how you advertise for jobs and how you keep records to evidence compliance with the RLMT.
There are exceptions. In recognition of shortages in a number of areas, roles which feature on the Shortage Occupation List (SOL) are exempt from the RLMT. In cases of SOL positions, employers may issue a Tier 2 CoS to a non-European worker without the need to demonstrate that a resident labour market test (RLMT) has been carried out.
Need help applying for a sponsor licence?
UK immigration rules are demanding on employers who want to bring talent to the UK, and through increasingly protectionist immigration policies, designed to favour UK-resident labour, the rules have become more onerous (and costly) for employers.
DavidsonMorris can 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.
It may also be that a sponsor licence is not the best option for your business and its needs. We can advise on the most suitable entry routes for your specific requirements.
For guidance on applying for a sponsor licence, contact us.
How do I become a sponsor for immigration?
To sponsor a non-EEA national with qualifying skills in a qualifying role, an organisation must first apply to the Home Office for a sponsor licence. Sponsor licence holders must evidence in their application that the role being recruited for meets the requirements and that the organisation understands and has the capability to meet specific ongoing compliance duties.
How long is the sponsor licence processing time?
Sponsor licence application processing can take between 2-3 months, provided there are no issues or delays with your application. Time should also be factored in to build the application, compile the supporting documents and ensure the organisation is geared to meet the compliance duties.
What are the sponsor licence application fees?
To apply for a sponsor licence, the organisation will have to pay the relevant fee. For small companies and charitable organisations, the fee is £536. The fee is £1476 for medium and large employers.
What is a certificate of sponsorship?
The CoS is a self-certifying document that a sponsor licence holder issues to a Tier 2 visa applicant to onboard them into the organisation. It is used to confirm to the Home Office that the role you are recruiting for meets all of the relevant requirements under the visa classification.
How can DavidsonMorris help?
DavidsonMorris are specialists in UK immigration, working with UK employers to support with their immigration needs in areas such as sponsor licence applications and ongoing licence compliance. We can guide you through the Home Office application process, advising on the application itself as well as auditing your internal HR systems and policies against the required standards and helping with preparation for a site visit. Once issued, we can also support with operating and managing the licence from assigning certificates of sponsorship to advising on ongoing compliance.