Under the UK immigration system, employers who do not have a valid sponsor licence will be unable to hire new skilled workers from either EU or non-EEA countries, or extend work permits for current sponsored employees.
To renew the sponsor licence, the organisation will need to submit an application through the Sponsorship Management System and pay the relevant sponsor licence renewal fee.
How much is the sponsor licence renewal fee?
The licence renewal fee will vary depending on the size and turnover of your organisation. A discounted rate applies for charities and small organisations. It is essential that you pay the correct fee or your renewal application will be rejected.
|Type of licence||Fee for small or charitable sponsors||Fee for medium or large sponsors|
|Worker sponsor licence||£536||£1,476|
|T5 sponsor licence||£536||£536|
|Worker sponsor licence (large sponsor) where sponsor currently holds a Temporary Worker and/or Student Sponsor Licence||–||£940|
To determine an organisation’s classification, the Companies Act 2006 definition of a small company is used. To qualify as a small company, the organisation must meet at least two of the following conditions:
- Annual turnover must be not more than £10.2 million
- The balance sheet total must be not more than £5.1 million
- The average number of employees must be not more than 50
Where these criteria do not apply, the organisation should pay the medium or large sponsor fee.
Sponsor licence renewal process
Once the renewal has been submitted on the SMS and the relevant fee has been paid, the Home Office will process the application in two stages; validation checks and the review stage.
During the validation, the caseworker will check the status of the existing sponsor licence, eg whether it is A rated or subject to an action, and check there are no issues with the renewal application which would result in a rejection, such as failing to submit additional documents in time.
The review stage concerns checks that will be performed to verify continued eligibility for the licence, including checks against nominated key personnel and the organisation itself, that it operates legally in the UK, continues to be suitable to be a licensed sponsor and is able to meet the compliance duties.
Generally, this will involve checking Companies House records to confirm continue operations in the UK, and checking the organisation’s SMS – including the information contained about the organisation, its sponsored workers and Certificates of Sponsorship that have been issued.
Where the Home Office requires further details, it may request further information or documentation from the organisation. The organisation usually has five days to respond.
In some cases, the sponsor may only be subject to the ‘streamlined licence renewal’. This applies where the sponsor has renewed their licence on two previous occasions and been granted their renewals without any compliance breaches or issues. The streamlined process means the following will not be checked as part of the renewal:
- Company & insolvency checks
- Certificate of sponsorship allocations
- Licence structure
- Site inspection history
- Outstanding change requests
- Risk profiles
- Accreditation and registration details, unless the sponsor is operating in the Education or Human Health and Social Work Activities sectors
- ‘Other trading checks’
- Compliance visit referral
- Record a review outcome in case actions in Metastorm or
- Issue a decision letter
When should you renew the licence?
The renewal application should always be made before the current licence expires. Sponsors can usually apply to renew up to three months before their current licence is due to expire.
This will help to avoid disrupting your permission to sponsor workers and to avoid curtailment issues with your sponsored workers’ immigration status. This should also allow for time to take corrective action (such as making a new application), should the application be rejected.
The Home Office should write to sponsors 120 calendar days prior to the expiry date as a reminder to renew, with a further communication at 30-day intervals up to the last month with a final reminder two weeks before the expiry date. It is therefore imperative that the contact details on the SMS are up to date so that the communications are received by the relevant personnel.
If the licence is left to expire before a renewal application is made or is granted, a number of issues can ensue. All workers sponsored under the licence will no longer be lawfully employed and as such will be in breach of their visa requirements. This means their leave will be curtailed and they will need to leave the country within 60 days (or sooner if their leave expires before then) unless they can secure permission to remain by, for example, finding a new sponsor.
Your options with an expired licence – whether you can make an urgent application to renew or if you will need to apply for a new licence – will depend on the circumstances. Taking professional advice will help to ensure you proceed with the most appropriate course of action for your needs.
Common grounds for a refused renewal application
Sponsors should prepare to be put under greater scrutiny under the renewal application than with the initial licence application. Having operated with a licence for four years, the Home Office expects that the organisation has managed its licence to the required standards, and will use the renewal application stage as the opportunity to verify compliance and confirm that there has been no abuse of the sponsorship process.
This should include carrying out a mock immigration audit to help identify potential areas of risk and non-compliance which may give grounds for a refused application. Addressing these issues before you renew can help to optimise your chances of being granted the licence for another four years.
The reality, however, is that not all sponsor licence holders are able to show that they have continued to meet the requirements. Some employers have only one sponsored worker and the bureaucracy around managing the licence falls off the business’ radar, while for other organisations, particularly larger employers, there may be poor or inconsistent internal HR practices which are in breach of the licence duties.
Common reasons for renewal applications failing include:
- Payment of the incorrect licence renewal application fee
- Failing to meet sponsor compliance responsibilities
- Poor record-keeping
- Failing to report the required changes relating to migrant workers or the organisation, or reporting changes out of time
- Failing to cooperate with the Home Office and not responding to communications
- Neglected to confirm genuine vacancies before offering employment to a migrant worker
As well as risking a failed renewal application, the above grounds are also cause for enforcement action such as downgrading, suspending or revoking the sponsor licence. The underlying requirement is that licence compliance forms part of the employer’s everyday activities, through effective HR systems and key personnel capable of performing their duties.
Post-licence Home Office inspections
Where there are concerns about non-compliance, the assigned caseworker may refer the for a compliance visit, with a decision on the renewal application will be made after the inspection.
During the inspection, Home Office officials will gather further information and documents and can conduct interviews with sponsored workers and key personnel within the organisation.
Site inspections can be conducted with or without notice. Given the scrutiny that comes with a site inspection, sponsors are advised to be prepared for a visit before submitting their renewal application. This means if the Home Office attends your premises, you are in a position to provide the required information to evidence compliance and support your renewal application.
Compliance issues identified during a site inspection can give grounds to refusing the renewal application.
DavidsonMorris’ specialist UK immigration lawyers have specific expertise in sponsor licence renewal applications and supporting sponsors with auditing their immigration compliance and ensuring they are ‘match fit’ for Home Office scrutiny. For advice and guidance with preparing your organisation for a licence renewal, contact us.
Sponsor licence renewal fee FAQs
How do I renew my sponsor license?
Renew your organisation’s sponsor licence on the Sponsor Management System. You may be asked to provide additional documentation to support your application, which must be provided by the given deadline.
How much does a sponsorship licence cost?
The sponsor licence application fee varies depending on the size of your organisation; SMEs and charitable organisations are charged £536 while larger employers pay £1,476. You may also opt to pay an additional £500 for priority processing of your application.
How much does it cost a company to sponsor a visa UK?
Sponsoring a work visa requires an employer to pay a sponsor licence application fee and the fee to assign a Certificate of Sponsorship to each sponsored worker.
Last updated: 30 August 2021
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