Tier 2 licence renewal after 4 years

Under the Points Based System (PBS) UK employers have to be licensed by UK Visa and Immigration (UKVI) before they can employ non-EEA workers. Sponsor licences are granted for an initial period of four years. To continue to employ PBS workers lawfully, those companies will need to apply to renew their sponsor licence ahead of licence expiry at the four-year mark.

For many companies, the renewal application can quickly become a more demanding and involved process than the initial licence application. In addition, as part of the licence extension process, the UKVI reserves a right to undertake a compliance visit to sponsor companies and request corporate documentation as deemed necessary.

What is involved for licence holders looking to renew their licence?

Tier 2 licence renewal process

Companies have to submit a Tier 2 licence renewal application via the online Sponsor Management System (SMS).

The UKVI advises that renewal applications can be submitted at least three months prior to the current licence expiry date, and a nominated Level 1 User should be able to pay an appropriate fee, complete a sponsor declaration and request renewal online.

Preparation will be key. Your organisation should undertake proactive steps to ensure readiness for this process and the potential scrutiny which may result from the Home Office as to your organisation’s continued compliance with the regulations.

Many of the reasons for tier 2 licence refusal are:

  • Failure to pass a UKVI compliance audit- your organisation will be evaluated against the legal requirements under the sponsor licence.
  • Failure to have retained the required documentation on sponsored migrants – record keeping duties are strict and ongoing.
  • Failure to have advised UKVI of significant changes to company structure and personnel – strict timescales apply when notifying of organisational changes.
  • Failing to respond to UKVI’s enquiries in a timely manner – engaging with the Home Office will help your cause.
  • Failure to pass the ‘genuineness test’ – if the role is perceived not to be a genuine vacancy requiring an overseas skilled worker.
  • Failure to comply with UKVI security standards

Correctly applying to renew your organisations sponsor licence is crucial for your business operations and ability to continue to sponsor migrant workers.

An audit of your organisation’s compliance with its sponsorship duties can be used to identify areas of risk and confirm areas of compliance. Look specifically at key duties such as maintenance of records for migrant workers, carrying out necessary compliance checks on your staff and timely reporting of all necessary changes in migrant activities to UKVI.

You should ensure that licence management to date has been compliant and that the application for renewal is accurate, timely and effective.

Any necessary changes to your sponsor licence should be made before the extension application is lodged with the UKVI.

Preparing for a site visit 

Renewal applications commonly trigger a Home Office site visit. This is fairy routine and employers should take steps when preparing their renewal application to ensure they are ‘match-fit’ for a site inspection should this be requested.

During the visit, Home Office officials will look to assess whether your organisation is complying with its duties under the licence, for example in respect of record keeping, key personnel appointments, migrant worker . They will ask to see relevant employee records and documentation and may also ask to speak with relevant members of staff.

Issues or breaches identified during the inspection can result in refusal of your renewal application, so it pays to be well prepared.

15% of sponsor licence renewal applications are refused

A refused renewal application can have devastating effects on a business and its PBS workers. Without a lawful sponsor, PBS workers will see their leave curtailed unless they can find qualifying employment before their curtailed leave expires.

If the business does the lose out on PBS workers, they will have to look at recruiting again, which can be problematic in sectors where skills shortages prevail.

Tier 2 licence renewal – expired licence?

Licences can be left to expire for many reasons – perhaps there has been a change in personnel responsible for the licence, or there has been a failure or oversight in updating the SMS contact details and the expiry reminders have not been received by the correct person. In practice, the issue often only comes to the employer’s attention when a PBS worker applies to the Home Office for ILR, and the out of date licence is then flagged.

If you become aware that your licence has expired, you will need to take swift corrective action to try to retain your ability to lawfully hire PBS workers.

This may require a new application to be made for a new sponsor licence, or you may be able to apply for reinstatement by the Home Office. Taking immediate advice on your options can help to rectify the situation and help mitigate further compliance risks.

Do you have a question about Tier 2 sponsor licence renewal?

DavidsonMorris can provide clients with a complete Tier 2 licence renewal application package which includes:

  • Assisting with initial considerations as to the type of sponsorship application and suitable key personnel
  • Help you to collate the appropriate supporting documentation
  • Audit your HR systems and procedures to get them in order before the UKVI visit

Our team of UK immigration specialists is well-versed in all the document and evidentiary requirements that can be vital to a prompt and successful application for tier 2 licence renewal. We are also happy to support you in renewing your licence and managing the information the Home Office requires to be notified of during the duration that you hold the licence.

For advice with an application for ILR,  contact us.