Is your sponsor licence
up to date?
25 September 2024
As a licenced sponsor of migrant workers, you are required to keep the details on your sponsor licence up to date at all times, and must report any significant changes to your business to the Home Office within set timeframes.
This obligation forms a key part of your sponsorship duties that you agreed to uphold when applying for your licence, and failure to comply can have serious consequences.
It has recently become clear that the Home Office is taking a renewed focus on employer compliance and is conducting more thorough checks on sponsors when considering applications such as a change of circumstances request or requests for Defined Certificates of Sponsorship (DCoS).
The new policy means that Home Office caseworkers are now conducting full Companies House checks on sponsors when they submit such requests, to identify any changes to the business that do not match up with the details held on the sponsor licence.
Smith Stone Walters has recently observed a number of DCoS refusals for sponsors who have failed to update key changes on their licence, such as a change of corporate ownership.
A change in business ownership will typically result in organisations needing to apply for a new sponsor licence. This can cause serious issues when a sponsored worker needs to renew their visa before it expires, but the employer needs to make a last-minute application for a new sponsor licence beforehand.
Sponsors are reminded that it is mandatory to report changes within the given timeframes set out in the guidance for sponsors.
Reporting changes to the Home Office
Reporting is a key part of your sponsor duties and you must tell the Home Office about any significant changes that affect your sponsored workers or your organisation.
Significant changes to your organisation that must be reported include, but are not limited to:
- A change of address
- Changes to your Key Personnel
- If you are convicted of a relevant offence
- Changes to your organisation’s structure, such as more branches or sites, or new linked entities in the UK (or overseas if you are licensed on the Global Business Mobility routes)
- If your organisation is subject to a merger, takeover or similar change.
Most changes can be reported via the online Sponsorship Management System (SMS). In limited cases, you will need to complete a ‘sponsor change of circumstances form’ instead. Once you have submitted details of the change or changes, the Home Office may request further information and/or supporting evidence.
You can find guidance on how to request or make these changes in SMS Manual 2: Manage your sponsorship licence.
Mergers, takeovers and similar changes
You will need to take action if your organisation is involved in a change of ownership, merger, takeover, de-merger, or similar change.
Your sponsor licence is not transferable and what happens to you, and your sponsored workers, will depend on whether:
- There is a change in direct ownership.
- You sell all or part of, or the controlling number of shares in, your organisation.
- You are partly or wholly taken over by another organisation.
- You are splitting out to form new organisations.
Your Level 1 User must report any of the above changes via your SMS account within 20 working days of the change taking place. If you fail to do so, your licence may be downgraded or revoked. If your licence is revoked, any workers sponsored by you may have their permission cancelled.
Where there is a change in direct ownership of your organisation, your sponsor licence will be either revoked or, if sponsored workers have transferred to another sponsor’s licence, made dormant. The new owners must then apply for a new sponsor licence, if they don’t already have one, if they wish to continue employing any workers you were sponsoring.
More information on what you need to do if your business changes ownership can be found in the guidance for sponsors.
Support with sponsor compliance
The increased checks now being carried out on sponsors shows that the Home Office is taking decisive action to support the government’s agenda on improving employer compliance and reducing illegal working.
It is now more important than ever for employers to understand and uphold their compliance obligations when it comes to sponsoring overseas workers.
Talk to Smith Stone Walters about supporting your organisation in complying with its sponsor duties. Our bespoke Immigration Audit Service will be tailored to meet your business needs and budget, whilst helping you to avoid incurring penalties.
Whether you require a peace-of-mind soft audit or a fully outsourced immigration compliance solution, we have the answers.
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