New challenges for work visa sponsors; the impact of the latest changes

The Home Office sponsor guidance documents apply directly to employers and businesses licensed to sponsor overseas workers under one of the UK’s work visa routes, the most common being Skilled Worker. They are also highly relevant to prospective sponsors.

Earlier this month, hidden beneath the headlines on asylum reform and higher English language requirements, the government quietly made some significant changes to its sponsor guidance documents. These could have a profound effect on the way that employers and sponsors operate regarding their sponsored workers. This article highlights the most significant of these changes and the current trends we are seeing in the Home Office’s approach to compliance.

Sponsors must read the guidance

Sponsors have always been supposed to read the guidance documents but this requirement has now been explicitly set out as one of the Home Office’s ‘guiding principles’ of sponsorship. All sponsors and prospective sponsors are required to read the guidance documents relevant to them and to remain aware of the current content. This is no mean feat considering that there are 14 guidance documents, the longest of which is 75 pages, and 3 appendices.

In reality, being able to demonstrate familiarity with the main tenets of the guidance is likely to be more important than memorising sections of it. Sponsors should ensure their HR teams, relevant line managers or anyone else who manages or oversees the running of the sponsor licence knows which guidance documents are relevant and where to find them. A good working knowledge of the main compliance, record-keeping and reporting requirements is essential. Signing up for alerts to changes to these documents through GOV.UK may also be helpful in showing that you are a responsible sponsor that takes its compliance duties seriously.

It’s all about workers’ rights

The ‘guiding principles’ also place new emphasis on a sponsor’s responsibility to comply with UK employment law and uphold workers’ rights. This reflects the government's current concern about abuse of migrant workers, particularly in certain sectors, and is something we frequently see raised when sponsor licence revocation cases reach the courts.

Sponsors must now be able to demonstrate that they provide information on workers’ rights to their sponsored workers, and they should retain evidence that they have done so for each worker they sponsor. So far there is limited further explanation from the Home Office about what precisely they mean by this but it appears to go beyond the information employers are required to provide under section 1 of the Employment Rights Act 1996.

Compliance with this duty may look different for each employer, depending on their size and HR resources, but at the very least we would recommend reviewing on-boarding procedures for sponsored workers to ensure this requirement is being met.

Are you sponsoring an ‘eligible role’?

Previously, before a business could sponsor a worker it had to show that there was a ‘genuine vacancy’ i.e. that there was a genuine business need for the sponsored role and it was not created or exaggerated to facilitate immigration. This concept has been replaced by the term ‘eligible role’. Migrant workers can only be sponsored to undertake ‘eligible roles’, which must meet all the following criteria both before sponsorship begins and throughout its duration:

• The role must exist or be reasonably anticipated
• The role must meet all route-specific requirements including skill level and salary thresholds, and wider employment legislation
• The role must require the job holder to perform the specific duties and responsibilities set out on the CoS, including the number of hours per week.
• The role must remain appropriate to the sponsor’s business throughout the period of sponsorship.

Is the role appropriate and sustainable?

Linked to the above, another current area of focus for the Home Office is the sustainability and appropriateness of sponsored roles in the context of the business sponsoring them. Hence this features as one of the criteria of an ‘eligible role’, but it is also something we see increasingly scrutinised at both the sponsor licence application stage and in CoS requests.

Smaller businesses and start-ups are highly likely to be subject to a pre-licence compliance audit and are often asked questions to test the necessity of the role(s) they want to sponsor and whether they can be sustainably funded, especially if the business has not yet started generating revenue.

In addition, the latest sponsor guidance confirms that sponsor licence applications and/or requests for defined Certificates of Sponsorship (DCoSs) to hire overseas workers will be rejected if it appears to the Home Office that the role is not necessary for the business, the proposed annual salary doesn’t appear to correspond with the business’ finances, the role does not appear to meet the ‘eligible role’ criteria or the Home Office are not satisfied the sponsor can provide guaranteed work or the existence of the role is not secure.

What are your sponsored workers actually doing?

The Home Office are increasingly taking compliance action against sponsors when they find discrepancies, even minor ones, between a sponsored worker’s job description on their CoS and the role they are actually doing day-to-day. Recent changes to the guidance contain new emphasis on the importance of ensuring the CoS is an accurate reflection of the role in reality. It would be prudent for sponsors to review their sponsored workers’ current roles against their CoSs to ensure there is extremely close correlation between the two.

Any permitted changes of role (i.e. within the same SOC classification) must be reported via the sponsor management system within 10 working days of taking effect and failure to do so is likely to result in compliance action. Changes of role should be approached cautiously and advice should be sought before anything takes effect, as some changes will require a new visa application first.

Don’t arouse Home Office suspicion

The courts consistently uphold the position that the Home Office is entitled to a ‘light trigger’ approach to sponsor compliance enforcement. The guidance now states that enforcement action may be taken on the basis of ‘reasonable suspicion’, rather than any established breach, and in practice there is often something of a ‘revoke first, ask questions later’ approach. Increased data-sharing between government departments, particularly between the Home Office and HMRC, which is triggering compliance investigations where it appears that salary payments do not reflect the annual salary stated on a CoS, even where this has been caused by simple administrative error.

Recent additions to the guidance also confirm that revocation grounds ‘do not necessarily require breaches to be deliberate or made knowingly’. This is stated to be because of ‘the importance of strict adherence to the rules of the sponsorship scheme to maintain the integrity of the scheme’. Clearly, no business wants to find itself on the back foot trying to persuade the Home Office to withdraw a licence revocation. In this case, prevention really is better than cure and front-loading resources into compliance upfront can save a huge amount of time and trouble further down the road.

Pay evenly

Linked to the point above regarding salary payments, for CoSs issued on or after 8 April there is a new requirement that sponsors pay sponsored workers in even instalments at least monthly, or as specified in their contract. The payment amount for each pay period must equal or exceed the going rate for every hour worked in that period. If their contract specifies a more or less frequent payment period, the amount paid in each period must still be an even proportion of the annual salary and there are various new formulae in the immigration rules for calculating the exact amount. Where a worker’s regular weekly hours vary, their sponsor must confirm their working pattern to the Home Office and the salary paid over any 17-week period must be at least equal to 17/52 of the annual salary.

The stated aim is both to promote worker welfare by securing regular, even payment and to enable the Home Office to spot underpayment earlier, enabled by the increased intelligence-sharing with HMRC.

Check your checks

All employers should be familiar with the duty to carry out right to work checks on their employees. However, sponsors are required to go a step further and undertake checks on all their employees and sponsored workers, even sponsored workers who are not direct employees but have worker or self-employed status. This has been the case for a while but there is new emphasis on it in the revised guidance. Although the current civil penalty regime in relation to illegal working only applies to employees, failure to conduct checks on all sponsored workers is likely to lead to compliance action. Furthermore, once the planned expansion of the right to work regime comes into force (likely later this year or early 2027), all workers will be in scope of the civil penalty regime.

Sponsors should therefore ensure their current checks are all up to date and they have robust on-boarding and monitoring processes in place to ensure that checks are carried out in a timely manner and the required evidence is retained.

How we can help

The sponsor guidance is labyrinthine and the stakes are high; loss of a sponsor licence can cause significant operational disruption and expose a business to multiple immigration and employment law risks. Successfully navigating a Home Office compliance inspection requires forward planning, ongoing diligence and meticulous scrutiny to ensure the business is audit-ready at all times.

We recommend all sponsors familiarise themselves fully with their compliance obligations, ensure relevant staff are appropriately trained and review their day-to-day licence operations to identify any risk areas or weaknesses in current processes. Should you require further advice or assistance, our team would be happy to discuss your needs. Our services for sponsors are highly bespoke and can cover full internal audits, sample reviews, staff training, sponsor licence and visa application assistance and ongoing sponsor licence management.