Scale-up Sponsor Licence Application

The Scale-up visa enables highly skilled overseas candidates to work in the UK for a fast growing / scale-up business. In order to recruit and sponsor an overseas worker, Scale-up employers need a sponsor licence. It is worth mentioning that after 6 months of sponsorship on a Scale-up visa, overseas workers can switch roles and no longer need to be sponsored.

Scale up sponsor licence requirements

To qualify for a Scale-up sponsor licence, a business must:

• Meet the criteria of a Scale-up business
• Meet the job requirements
• Have the necessary sponsorship HR systems in place

Meet the criteria of a Scale-up business

As the Home Office’s guidance explains, there are two pathways to qualify as a ‘Scale-up sponsor’¹; the standard pathway and the endorsed body pathway.

The standard pathway

The standard pathway requires that businesses applying for a Scale-up sponsor licence:

• Have annualised growth of at least 20% for the 3-year period before applying – this can be based on staff count or turnover.
• Have had a minimum of 10 employees at the start of the 3-year period before applying.

The enhanced pathway

The enhanced pathway is offered as an alternative to the standard pathway and is used if HMRC does not yet have enough history (at least 37 months is needed) on which to assess your application. Using this pathway, Scale-up sponsor licence applicants must be endorsed by an approved endorsing body². To qualify for enhanced pathway endorsement, you will need to demonstrate that your business meets the following requirements:

• have at least 10 PAYE employees
• be registered with HMRC for VAT
• be currently solvent and trading in the UK
• have an HMRC history of fewer than 4 years
• meet the criteria of a Scale-up business
• demonstrate that you will meet the standard pathway requirements within the next 4 years, and
• be able to pay appropriate salaries to individuals working in roles that meet the skill level for the Scale-up route

In addition, you must meet 3 or more of the following requirements:

1. Growth – have more than 20% growth in turnover or employment per year over 2 years.
2. Participation in a relevant Government programme or receipt of relevant Government funding – have participated in a recognised scale-up programme, such as Innovate UK EDGE or DCMS Creative Scale-up, received an Innovate UK loan or grant, or participated in the Small Business Research Initiative.
3. Finance – have raised £1 million or more in equity finance in a single round in the 12 months before applying for endorsement.
4. International presence - have global offices or operations and generate a minimum threshold of 10% of turnover from exports.
5. Research and development - have research, development or innovation expenditure of:
   • 10% of your overall operating costs per year for 3 years, or
   • 15% in one of the last 3 years

Meet the job requirements

Scale-up sponsors must be able to sponsor overseas candidates for roles listed on the table of eligible occupations³. Sponsors must also be able to meet the minimum salary requirements for the Scale-up visa route, i.e. at least £34,600 per year or the ‘going rate’ for the sponsored job (whichever is the higher).

For example, for chief executives and senior officials, the minimum salary is £67,300 (the going rate). For production managers and directors in manufacturing, the minimum salary is £34,600 (as this is more than the going rate for the occupation).

Have the necessary sponsorship HR systems in place

All UK work sponsors are required to have in place HR systems and processes that will enable them to monitor and keep records of sponsored workers and report important changes to UK Visas and Immigration (UKVI).

How to apply for a Scale-up sponsor licence

To apply for a Scale-up sponsor licence, you will need to complete the following steps:

1. Complete and submit the sponsor licence application form⁴
2. Pay the Scale-up sponsor licence application fee (£536 for small and charitable sponsors or £1,476 for medium or large sponsors)
3. Provide the submission sheet to UKVI (you will find this at the end of your application form)
4. Submit any documents requested by UKVI

Once you have completed the above steps, you may receive a pre-licence visit from a UKVI compliance officer to check you can meet your sponsor licence obligations.

Most applications are processed within 8 weeks. However, if you require a faster decision, you can pay an extra fee of £500 for a decision within 10 working days.

Skilled worker sponsor licence vs Scale-up sponsor licence

The main difference between the Skilled Worker sponsor licence and the Scale-up sponsor licence is that overseas employers only need to be sponsored for 6 months. At the end of 6 months, your sponsored worker can then either continue working in their job, change jobs, or stop doing their job without asking permission from the Home Office. This offers considerable flexibility for the scale up sponsor licence holder as sponsored workers can easily switch to a job which is not on the list of eligible occupations or to a role with a different standard occupational classification (SOC). This also means that Scale-up workers can make an unsponsored visa application if they have already been sponsored for 6 months or more under this route.

Another difference is that Scale-up sponsor licence holders must satisfy UKVI that they are experiencing significant growth (this is not a requirement when applying for a Skilled Worker sponsor licence). And when it comes to pay, the minimum required salaries are higher, and the eligible roles are generally more senior for Scale-up sponsorship.

And finally, successful sponsored Scale-up worker applicants are given permission to stay for up to 2 years initially (this can be up to 5 years on a Skilled Worker visa). However, as a Scale-up, you will technically only sponsor your worker for the first 6 months of their leave even if they continue to be employed by you.

If you need help to apply for a sponsorship licence, please speak to our immigration lawyers for a free telephone consultation on 020 3744 2797 or by email at info@reissedwards.co.uk.

References

¹ GOV.UK: Guidance for sponsoring a Scale up worker

² GOV.UK: Endorsing bodies for Scale up sponsor licence

³ GOV.UK: Going rates for eligible occupations

⁴ GOV.UK: Applying online for a sponsor licence