Sponsor Licence Application Guidance: UK Visa Sponsorship for Employers

What is a sponsor licence?

A sponsor licence (previously known as a Tier 2 Sponsor Licence) is required by any UK employer planning to employ workers from overseas. With a sponsor licence, UK based businesses are able to issue Certificates of Sponsorship (CoS) to eligible international workers coming to the UK on a work visa (e.g. a Skilled Worker visa). As such, sponsor licences offer a valuable way to ensure that UK based businesses can recruit the staff they need from another country where needed. Sponsor licences are also required by educational establishments, including universities with international students.

It is important to note that having a sponsor licence does not mean that any employee you choose to sponsor will automatically obtain leave to remain in the UK. They will have to meet their own UK sponsorship visa requirements. Sponsor licences are not connected to any employee but issued to and for the company.

The sponsor licence application process is strict, and keeping your Sponsor Licence requires committing to a rigorous compliance regime. Sponsor licence compliance involves ensuring that your HR processes and procedures run smoothly and effectively in accordance with the Home Office’s requirements.

Sponsor licences are issued for a period of 4 years, at which point employers need to apply for renewal.

For questions on any aspect of your sponsor licence, please contact our business immigration lawyers for a telephone consultation on 020 3744 2797 or by email at info@reissedwards.co.uk.

What are the eligibility requirements for a sponsor licence?

In order to be eligible for a Tier 2 sponsorship licence, the applying organisation must meet the following requirements.

Be genuine, operating, and trading lawfully in the UK
Be UK based
Not represent a threat to immigration control
Have Key Personnel who are “honest and dependable”
Have an adequate HR system in place that allows you to carry out your obligations as a licenced sponsor efficiently on an ongoing basis

Business eligibility

Businesses applying for a sponsor licence must be genuine and legally operating in the UK as a PLC, LTD, LLP or Sole Trader. They must also hold the appropriate planning permission or the Local Planning Authority's consent for the type of business operated at the trading address.

Suitability requirements

As part of the sponsor licence application process, businesses need to show that they do not have unspent criminal convictions for previous immigration offences. They also need to satisfy the Home Office that they do not have any unspent convictions relating to crimes such as fraud or money laundering or have had a sponsor licence revoked in the last year. In addition, the Home Office must be satisfied that the Key Personnel named on the sponsor licence application are honest, dependable, and reliable. Key personnel refers to authorised officers and key contacts who will manage the sponsorship process.

Sponsorship management

The Home Office must also be satisfied that the company requesting the sponsor licence is not only aware but is also capable of carrying out its sponsorship duties. In practical terms, meeting your sponsorship duties means that you must have a system and processes in place within your business to:

Ensure the proper use of the sponsorship management system (SMS)
Ensure that sponsored workers have the skills and meet the criteria for the UK sponsorship visa they will be applying for
Carry out right to work checks
Check and store certain documents relating to the recruitment of overseas workers
Reporting certain events to the Home Office – i.e. if a sponsored worker leaves or if there are certain changes to the business.

Under the current system, there is now no longer a requirement to carry out a Resident Labour Market Test (RLMT) to check if a local worker is available to perform the job before it is offered to an overseas worker.

Types of sponsor licence

There are two main types of sponsor licence available. Businesses applying for a sponsor licence must specify which type they need when submitting their application and only recruit international staff for the type of licence they are granted.

Worker licence

A “Worker” licence is granted to employers who need to employ skilled international workers on a short time, long-term or permanent basis. Worker licences are available for a number of specific categories, including:

Skilled Worker – for workers who meet the skills and salary requirements
Global Business Mobility - for multinational organisations who wish to transfer existing employees to a branch or subsidiary in the UK (this was previously known as the Intra-company Transfer visa)
Minister of Religion - for international candidates coming to the UK to work for a religious organisation
International Sportsperson - for international elite sportspeople and coaches who wish to work in the UK

As part of the application process, businesses must specify which category of worker licence they require. Depending on your needs and eligibility, you can apply for multiple subcategories of worker licences.

Temporary worker licence

A “Temporary Worker” licence allows UK based employers to hire international staff on a short-term temporary basis, including volunteers. Temporary workers are available for several categories of workers as follows:

Creative Worker – for those in the creative industry (e.g. entertainers) coming to the UK for up to 2 years
Charity Worker - for unpaid workers working for a charitable organisation for up to 1 year
Religious Worker - for those employed by a UK religious order or organisation for up to 2 years
Government Authorised Exchange – for those coming to the UK for work experience for up to 1 year or working on research projects or training for up to 2 years (this scheme is to enable a short-term exchange of knowledge)
International Agreement – for international workers coming to the UK for a job related to an international agreement or law (e.g. for an overseas government)
Graduate Trainee (Global Business Mobility) – for international staff who are transferring to a UK branch of their employer under a graduate training programme
Service Supplier (Global Business Mobility) - for international workers coming to the UK to work on a contract to provide services for a UK company for up to 6 or 12 months
UK Expansion Worker (Global Business Mobility) - for international workers who have been sent to the UK to establish a new branch or subsidiary of an overseas business
Secondment Worker (Global Business Mobility) - for international workers who are transferring from overseas to work for a different UK business under a “high-value contract”
Seasonal Worker - for international workers coming to the UK to work in the area of “edible horticulture” for a period of up to 6 months (e.g. fruit and vegetable picking)

As part of the application process, businesses must specify which category of temporary worker licence they require. Depending on your needs and eligibility, you can apply for multiple subcategories of temporary worker licences.

How to apply for a sponsor licence

To become a sponsor, a business needs to complete a number of steps, as follows:

Decide which categories/tiers it wishes to include on its licence
Assess its eligibility and suitability for each category/tier and make any relevant changes to its HR systems
Decide who will be “Key Personnel” (Authorising officer, Key contact, Level 1 user of the Sponsor Management System, and Level 2 user of the Sponsor Management System)
Collate the appropriate documents for submission with the application
Decide how many Certificates of Sponsorship (CoS) it wishes to request for the first year of the licence
Complete and submit the online application¹
and hard-copy documents to the Home Office
Where relevant, prepare for and attend the Home Office site visit to the organisation’s offices
Receive the decision

Documents required for UK Visa Sponsorship

The Home Office publishes specific sponsor licence guidance outlining all of the possible documents that UK sponsor licence applicants may be required to submit². In most cases, you will be asked to submit a minimum of 4 documents. The sponsor licence guidance states you may not need to send 4 documents if you are a public body recognised by the UK Government, such as a local authority or a company listed on the London Stock Exchange Main Market.

Depending on your business and the type of licence you require, you may be asked to submit some or all of the following documents (please note this list is not exhaustive and is only a small sample of the possible documents you may be asked to provide):

Evidence that your business is genuine and active – e.g. accounts for the most recent financial year
Copies of contracts for goods or services covering at least the 12-month period before the date of application
Evidence you have a current corporate bank account with a bank registered by the Financial Conduct Authority and the Prudential Regulation Authority in the UK
VAT registration certificate
Franchise Agreement
Evidence of registration
Endorsement from a governing body
For religious worker sponsorship - details of your parent organisation and how you are connected to them, where applicable; a hierarchy chart, where applicable, that shows where you are in the hierarchy; the size of your adult congregation; the number of the clergy you currently employ, where applicable addresses of your regular meeting places; and your scheduled days and hours of worship.
Proof of connection to a qualifying overseas business by common ownership or control or through a joint venture agreement
Evidence of your graduate training programme
Proof of your UK ‘footprint’
Evidence of your overseas trading presence
Evidence of your planned expansion to the UK

How long does it take to apply for a sponsor licence?

In most cases, sponsor licence applications are processed within 2 months.

If you require a faster decision, you may be able to pay £500 for a decision within 10 working days. The Home Office limits the number of these priority applications (a limited number are made available each day and are allocated on a first-come, first-served basis).

Once you have submitted your application, you will be advised if you can use the priority application service and how to do so.

How much does a sponsor licence cost?

The sponsor licence application fees are as follows:

Type of licence	Small or charitable sponsors	Medium or large sponsors
Worker licence	£536	£1,476
Temporary Worker licence	£536	£536
Worker and Temporary Worker licence	£536	£ 1,476
Adding a Worker licence to an existing Temporary Worker licence	No cost	£940
Adding a Temporary Worker licence to an existing Worker licence	No cost	No cost

To be classed as a small or charitable sponsor, your business must meet at least two of the following criteria:

Have an annual turnover of £10.2 million or less

Have total assets of £5.1 million or less

Have 50 employees or less

For more information about the cost, please see our article: UK Work Visa Sponsorship Costs for Employers

Sponsor licence Rating

Under the current sponsorship system, businesses are either given an A rating or a B rating. Businesses granted a new employer sponsorship licence will be A-rated. Later, where the Home Office has concerns that a business is not adhering to its sponsorship duties, it may downgrade a sponsor to a B rating. This means that they are unable to issue any new Certificates of Sponsorship and need to demonstrate to the Home Office that they have made any improvements requested before their A-rating can be regained.

If a sponsor licence holder is downgraded to a B-rating and they do not prove to the Home Office that all compliance issues have been addressed, they may have their licence revoked entirely. In this situation, any sponsored workers would have their leave curtailed (shortened). It is imperative to engage the services of an immigration Solicitor who can help you to regain your sponsor licence.

Certificate of Sponsorship

A sponsor licence number is a unique reference number included on a Certificate of Sponsorship (CoS) used by an overseas worker when applying for a work visa. A CoS is an electronic document containing important information about the job offer, including the type of job and the duration of the employment.

A nominated person within your organisation can apply for CoS using the Sponsorship Management System (SMS). If approved by the Home Office (typically within 1 day), the CoS can then be issued to the overseas Worker to prove they have been offered a job, which they can then use to apply for a work visa.

A CoS costs between £21 and £199 depending on the type of licence held.

How long does a sponsor licence last?

Sponsor licences are issued for a period of 4 years, at which point employers need to apply for renewal.

Sponsor licence application refused

There are several reasons why a sponsor licence may be refused, including:

Not meeting the sponsor licence compliance requirements

Businesses are required to keep up to date proof of ID as well as right to work documentation. The company must ensure that there are systems in place to remind HR to request a new copy of any documents before they expire. UKVI will refuse a sponsor licence application if they are not satisfied that your recruitment and human resource management systems comply with the UKVI standards.

Failure to respond in a timely manner to the Home Office’s enquiries

During the application process, UKVI may request further information and documents. If the items requested are not provided in time, the Home Office may refuse your application.

Concerns that your application is not genuine

A sponsor licence application may be refused if the Home Office has concerns that the applying business does not intend to use the sponsor licence in the manner intended.

Unspent criminal convictions

Sponsor licence applications may also be refused where an applicant has unspent convictions relating to crimes such as fraud or money laundering.

Providing incorrect or false information

Where the Home Office believes that incorrect information has been submitted when applying for a sponsor licence, they may refuse the application. This may happen, for example, where the applicant incorrectly states they are a small company to benefit from the lower application and CoS costs.

Cooling-off period following a sponsor licence application refusal

In some cases, where an application for a sponsor licence is refused, a “cooling-off” period may apply whereby the applicant is unable to reapply for a certain amount of time. This can vary from 6 to 12 months (in most cases, it will be 12 months). Whether a cooling-off period applies will depend on the reasons for the refusal. If the Home Office believe that you acted in bad faith by providing false or misleading information in your application, it is more likely to be imposed. Where an application is refused on the basis that the eligibility criteria have not been met, a cooling-off period may not apply, meaning a fresh application can be submitted as soon as possible. If your application is refused, you may be able to request a review of your case, e.g. if a mistake was made by the Home Office when considering your application.

Contact our immigration lawyers for a free telephone consultation on 020 3744 2797 or by email at info@reissedwards.co.uk.

References

¹GOV.UK: Online application for Sponsor licence

²GOV.UK: Supporting documents for sponsor licence