Sponsor Licence

The way that you hire non-British workers has changed. This helpful guide outlines everything you need to know about the Sponsor Licence, including eligibility, the application process, required documents, and maintaining the licence.

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What is a Sponsor Licence?

A UK Sponsor Licence is a licence granted to eligible UK businesses to enable them to hire international workers under specific visa categories.

The application process can be complex and requires organisations to submit evidence showing how they meet the eligibility criteria of the licence.

Since Britain’s exit from the EU, there have been a number of changes to the Sponsor Licence system that employers and organisations must be aware of in order to successfully apply for and maintain their licence.

Formerly known as the Tier 2 Sponsor Licence, the name has now changed to Sponsor Licence. Another change is the Resident Labour Market Test. This is no longer a formal requirement of the application process.

Note that your employees must also submit a visa application according to their individual circumstance. The business’s sponsoring of the international worker does not guarantee that they will be eligible to work in the UK.

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Who can apply for a Sponsor Licence?

There are a number of requirements that an organisation must meet to show that they are eligible for a Sponsor Licence.

Some of these requirements include:

  • Providing evidence that the UK-based business is genuine and operates lawfully within the UK, employing reliable personnel
  • Prove that there is a genuine offer of legitimate employment which aligns with the Skilled Worker skill and salary level
  • Demonstrate that there are robust human resources processes within the business to ensure sponsorship requirements are met
  • Employ workers who meet eligibility criteria and do not present a threat to the immigration system
  • Providing proof that the organisation does not have any unspent criminal convictions for certain crimes, including fraud and money laundering
  • Evidence that the applicant has never breached any immigration rules and has no history of failing to meet their sponsorship requirements

If you have several offices or branches of a UK-based business, you can apply for one Sponsor Licence or for individual offices (based on your circumstances).

In most cases, a private individual may not apply for a Sponsor Licence. An exception may be made if the person is a sole trader seeking to employ an eligible candidate.

Applying for a Sponsor Licence will require you to convince the Home Office that you are capable of accepting responsibility for upholding all the relevant rules and regulations.

There are penalties for non-compliance and this could negatively affect your business. Be sure that you have all the information on your responsibilities before submitting an application for a Sponsor Licence to the Home Office.

Types of Sponsor Licence

The different forms of Sponsor Licence can be divided into two categories: Skilled Worker and Temporary Worker visas.

Skilled Worker Sponsor Licence

Skilled Worker Visa: This category is designed for the sponsorship of new and permanent international worker hires

Intra-Company Transfer: For international companies with branches in the UK, this category enables the sponsorship of employees on a short-term basis

Minister of Religion: Religious organisations may sponsor people who intend to come to the UK to work for a religious organisation under this category

Health and Care Visa: This category has been designed for sponsoring doctors, nurses, healthcare workers and social care workers

Sportsperson: In order to come to the UK for sports purposes, this category can be used to sponsor individuals who are officially recognised as elite sportspeople or qualified coaches

Temporary Worker Visas Sponsor Licence

Read more about Temporary Worker Visas.

Creative and Sporting: Created for the sponsorship of individuals who work in the creative and sports sectors (on a short-term basis)

Charity Worker: This category allows for the sponsorship of people who would like to undertake unpaid or voluntary work for an approved charity organisation

Government Authorised Exchange: For individuals coming to the UK for the purposes of temporary work experience, internships, training, certain language programmes, and certain research or fellowship programmes, this category allows eligible organisations to sponsor them

International Agreement: This category allows for sponsorship of people who have been contracted to complete certain forms of work that have been agreed upon under international law

Religious Worker: Designed to sponsor people who intend to undertake certain forms of religious work on a short-term basis

Seasonal Worker: Created for the sponsorship of individuals who wish to work in the edible horticulture sector

How to apply for a Sponsor Licence

The government has stated that it wants the Sponsor Licence process to be as digital as possible. The application process can be completed online at this Gov.uk link.

The structure of the application process involves five distinct sections. The first section is selecting the appropriate type of category that the organisation intends to hold (whether this is a Skilled Worker, Intra-Company Transfer, or Temporary Worker category).

The second section involves providing the organisation’s details. This could include the business name, address, registration details, details of the number of employees, etc.

The third section of the application asks businesses to furnish the approximate number of Certificates of Sponsorship required for the first 12 months of being a sponsor.

The fourth section requests a number of documents to be provided in order to support their application. Below we have outlined in detail the types of documents that are required to submit with the application.

The final section of the online application asks for the contact details of the key personnel who have been assigned to manage the licence.

Required documents

There is no single document checklist that can be used to refer to when applying for a Sponsor Licence. Instead, there are guidelines around the types of documents that are acceptable to submit with your application.

Some of the following documents may be provided to the Home Office:

  • A lease or rental agreement for the business’s office, where relevant
  • Bank statements belonging to the business going back several months
  • A letter from the bank on the nature of the business’s bank account history
  • The business’s VAT certificate
  • Documents from HMRC with confirmation that the business is registered for PAYE and National Insurance contributions
  • The most recent annual accounts from the business
  • A liability insurance certificate belonging to the business
  • A supporting letter from the employer
  • A hierarchy chart of your business, including owners, directors, and board members. If the company has fewer than 50 employees, they must all be listed along with their titles
  • The CV of the person who is intending to come to work in the UK and their suitability for the role
  • The job description and advertisement

Depending on the type of Sponsor Licence, different documents will be required. It may be helpful to discuss your business’s exact requirements with a qualified immigration lawyer.

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Who manages the Sponsor Licence?

If you are granted a Sponsor Licence, you must be able to show that you can maintain the licence lawfully and ensure compliance. The person or people within your organisation who manage this process will be known as sponsor managers.

They will need to use the Gov.uk sponsorship management system (SMS). You can use this tool to do the following:

  • Manage or renew the company’s sponsorship licence
  • Create and assign sponsorship certificates to potential employees
  • Submit reports of changes of circumstances should the situation arise with your employee(s)
  • Report any business changes (e.g., change of location, etc.)

The management roles that must be filled are those of the authorising officer (someone who is senior in the business and competent to oversee the actions of staff using the SMS), the key contact (the person who liaises with UK Visas and Immigration), and a Level 1 user (the person who manages the day-to-day activities of the SMS).

These roles can be completed by the same person. However, there are suitability checks that will be undertaken to ensure that the sponsor manager is appropriately qualified to carry out this role. The Sponsor Licence may not be issued if any person involved in the management of the licence has:

  • Unspent criminal convictions
  • Been fined by or reported to UKVI in the past 12 months
  • Broken the law
  • Been a designated person at a company that has had its licence revoked in the past 12 months
  • Failed to pay VAT
  • A history of non-compliance with sponsor requirements

The sponsor managers must be based in the UK for the majority of the year. They must be an employee and not a contractor or consultant. They must not be subject to bankruptcy or debt restructuring.

Any of the sponsor management roles may be filled by the company’s UK-based qualified legal representative, with the exception of the authorising officer role.

What are the Sponsor Licence fees and processing times?

There is an application fee when applying for a Sponsor Licence. The fee will depend on the type of licence application and the organisation type. The two main types of applications are for Workers or Temporary Workers.

Fees

You will be classed as a small sponsor if two of the following circumstances apply to your business:

  • The business has an annual turnover of £10.2 million or less
  • Total business assets are valued at £5.1 million or less
  • The business employees 50 people or fewer

You will be classed as a charitable sponsor if you are registered, excepted, or exempt from charity, or if you are an ecclesiastical corporation established for charitable purposes.

The following are the current Home Office Sponsor Licence fees for 2021:

Licence type Fee for small/charitable sponsors Fee for medium/large sponsors
Worker £536 £1,476
Temporary Worker £536 £536
Worker and Temporary Worker £536 £1,476
Add Worker to existing Temporary Worker licence No fee £940
Add Temporary Worker to existing Worker licence No fee No fee

Processing Time

It is important to note that there is a waiting time while your Sponsor Licence application is being processed. In most cases, 80% of applications will be issued with a decision in less than eight weeks.

In some situations, you may be able to apply for an expedited decision (within 10 working days).

How to maintain the licence

In order to maintain the Sponsor Licence, you should ensure that you are in compliance with all the regulatory requirements and that you notify UKVI of any changes to your circumstances using the sponsorship management system.

There are a number of situations where you should update your company’s details. Some of the following situations may be relevant:

  • Change of name or address
  • Adding, changing, or removing a sponsor manager
  • Changes to key personnel in the company
  • Changing the organisational structure
  • Adding or removing Intra-Company Transfer links
  • Mergers, de-mergers, or takeovers
  • Making a licence dormant
  • Cancelling a Certificate of Sponsorship

Your duties as a sponsor organisation include the following:

  • Excellent record-keeping, including of the following documents:
    • A copy of each sponsored worker’s current passport with relevant entry clearances or permission to enter stamps
    • Evidence of the worker’s date of entry to the UK
    • Where relevant, a copy of the worker’s biometric residence permit (BRP)
    • Where relevant, a copy of the worker’s National Insurance number
    • The worker’s contact details
    • Where relevant, a copy of the worker’s Disclosure and Barring Service check
    • A record of the worker’s absences
    • Copy of the worker’s payslips with name, NI number, tax code, allowances and deductions
    • Evidence of the amount and frequency of all salary payments to each worker into a bank account or card
    • A copy of the contract of employment, including names and signatures of all parties, start and end dates, details of the job, hours of work, an indication of pay
    • A detailed and specific job description
    • Copies of the worker’s qualifications/ evidence of skill level and professional accreditation(s)

Furthermore, you must ensure a system for reporting to UKVI using the SMS if the worker does not turn up on their first day of work, if the contract is terminated early, if they have an unapproved absence for more than 10 days, if they have been promoted, or if their duties have changed. 

The genuine vacancy requirement

Although the requirement to show that no existing person in the UK could do the job (known as the Resident Labour Market Test) has now been abolished, there is still a requirement to show that there is a genuine vacancy.

The advantage of the Resident Labour Market Test being disbanded means that the application process has been shortened by approximately four weeks, which is a benefit for employers.

The Home Office guidance outlines the importance of evidencing this genuineness. The organisation must demonstrate that the sponsored worker is working within their designated occupation code.

This is why a company must show that the worker is employed in a position that meets their skill level. The Home Office has made it clear that businesses must demonstrate roles do not exist solely to bring individuals to the UK.

Home Office guidance further stipulates that a genuine vacancy is defined as:

  • The worker must be capable of performing the specific duties of the job
  • The worker meets all the eligibility criteria for the route being applied for
  • The role does not include irrelevant or lower-skilled tasks
  • The role is appropriate in terms of the business’s long-term plan

The Home Office has also created a list of vacancies that are not considered to be genuine:

  • One whereby a role does not actually exist
  • One which has an exaggerated or inaccurate job description to deliberately appear like a real role
  • One which was created solely to enable an overseas individual to come to the UK
  • One which has inappropriate requirements for the role or is otherwise incompatible with the business’s plan

In general, there is an expectation that you should have at least first advertised the role domestically, and then provide evidence of why this individual was the most suitable person for the role.

If you advertise for the role, you should be able to provide evidence of the recruitment process. This would include a carefully structured job advertisement with a clear outline of the role requirements, skills, guaranteed salary, and required experience and qualifications.

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What happens if the application is refused or rejected?

There is a difference between a Sponsor Licence being refused and rejected. If the application is refused, this indicates that the Home Office is not satisfied that the sponsor meets the requirements.

There will usually be a cooling off period which means that it is not possible to reapply until at least six months. Unfortunately, you will not have your application fee refunded.

If your application is rejected, you may receive a refund and the option to re-apply immediately. In most cases, it is caused by not providing some essential information.

What happens if the application is accepted?

If your application is accepted, you will need to manage the sponsorship through the sponsorship management programme (SMS).

You should be aware that licences must be renewed every four years. The earliest that a licence can be renewed is three months before the expiry date.

In order to renew the licence, you should submit the application using the SMS portal and by paying the appropriate fee.

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Related pages for your continued reading.

Frequently Asked Questions

A UK Sponsor Licence lasts for four years. You must ensure to apply in advance of the expiry date of the licence (the earliest you can apply is three months before it expires).

Some of the most common reasons for a refusal include the organisation submitting incorrect documents, failure to show proof of a genuine vacancy, or poor human resource structures to manage the licence.

Irish citizens are exempt from the new regulations governing EU citizens. It is not necessary to apply for a Sponsor Licence for your Irish employees.

The cost of a Sponsor Licence depends on the size and type of your business, and the nature of the licence. If you are a small business or a charity, a Worker and a Temporary Worker licence will cost £536.  There is no fee to add a Worker licence to an existing Temporary Worker licence (or vice versa).

For medium/large sponsors, a Worker licence is £1,476, while a Temporary Worker licence cost £536. Both a Worker and Temporary Worker licence together cost £1,476. To add a Worker to an existing Temporary Worker licence costs £940, but there is no fee to add a Temporary Worker to an existing Worker licence.