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Everything you need to know about applying for a sponsor licence

29 Oct 2020 By Elizabeth Howlett

With new immigration rules coming into force in just a few months, People Management explores the process for accessing skilled migrant workers from now on

For businesses reliant on a migrant workforce or hoping to access talent from overseas beyond this year, time is running out to get the necessary licence for when the Brexit transition period comes to an end.

The introduction of a new points-based immigration system means that, from 1 January 2021, foreign nationals looking to work in the UK will have to meet a minimum set of criteria, including an A-level-equivalent education and a minimum earnings threshold of £26,500 – although this earning threshold might be higher depending on the profession.

As such, from next year, employers looking to hire foreign nationals from both inside and outside of Europe will need a Tier 2 sponsor licence. But what is this? How do you apply for one? And what alternative routes can employers take to recruit skilled migrant workers? People Management spoke to Karendeep Kaur, manager at Migrate UK, to get the lowdown...

What is a sponsor licence?

A sponsor licence is currently a tool to allow employers to hire skilled nationals from non-EEA countries – from January 2021 this will be needed to hire EEA nationals as well. The main point to remember is that UK Visas and Immigration (UKVI) has time and again reiterated that holding a sponsor licence is a privilege and not a right, so there is always going to be an eligibility criteria that employers will have to satisfy with UKVI and this is always kept under strict review.

The sponsor license, if approved, is valid for four years and can then be renewed after that four-year mark.

Why is it important to get one if you want to hire workers from overseas next year?

In terms of dealing with next year, from 2021 employers will need sponsor licences to hire EEA nationals to work for their organisations in the UK. Businesses are going to struggle to fill vacancies they would normally have filled with the EU workforce. They are now not going to have that talent available and will need to sponsor that talent from the EU. Hence why getting the sponsor licence in place now is what is recommended by UKVI and practitioners like myself.

Organisations are going to put themselves on the backfoot in terms of accessing talent if they don't have a sponsor licence, because the competition is fierce and candidates are checking the register of licensed sponsors to see who has one.

How do you apply? 

The application process is online. There is a form you need to complete, and you need to send evidence along with this application. Usually you would send evidence via post that is certified by a solicitor and, in some instances, an accountant. But during the pandemic UKVI has allowed employers to email the evidence across with the application. It must reach them within five working days of the submission – if not you have to start the entire process again. The evidence required depends on the type of organisation, but generally it will need to show you are a genuine organisation with the ability to employ overseas nationals.

Do you have any tips on applying?

Ensuring you have the correct documents and an idea of the vacancies you want to fill in the UK is important. There is no point trying to send the evidence, only to realise you don’t have the correct information to hand, because UKVI is unlikely to respond asking for it – they will just refuse your application.

You should also make sure you have the correct key personnel in place. These are going to be individuals who are ready and prepared to take responsibility for their role within the sponsor management system, and they need to be up to date with the terms and the rules, so seek professional assistance from experts. Key personnel must ensure record keeping, reporting and right-to-work checks are up to date. This includes notifying UKVI of any changes within the organisation or to a migrant’s employment within a specified timeframe.

The rules surrounding the maintenance of a sponsor licence are quite strict. In severe cases if you are found in breach of them, UKVI may issue a fine of up to £10,000 and you could also face prosecution.

How long does it take to apply?

UKVI had recommended that you should have a sponsor licence in place by autumn 2020, which has of course come and gone now. The sponsor licence application typically takes eight to 10 weeks to be reviewed by UKVI, but with the pandemic there are going to be delays. If you haven’t already applied and want to hire someone from the start of January, for example, then you may have to wait some time for UKVI to approve your application, and with the delays that is unlikely to happen. A risk of not applying soon is that candidates may back out of jobs if the licence hasn’t been approved but a competitor has had theirs approved.

You can also expect a pre-licence visit from a compliance officer from UKVI. A compliance visit is not something to be worried about because it’s quite common for UKVI to do this as part of the pre-licence audit. They just want to make sure your organisation has the correct processes in place and that you’re able to track your workforce.

What alternatives are there if you don’t apply?

In terms of options for organisations, there aren’t really any alternatives. But there will be other immigration routes available to individuals without the constraints of skills or salary levels. For example, there will be quite a few EU nationals already working in the UK before 11pm on 31 December who will be on either settled or pre-settled status.

There are also sponsored workers on Tier 1 and Tier 2 categories, and their dependants can technically work for your organisation without the need for sponsorship. There are also long-term students on a Tier 4 general student category or individuals that hold a graduate scheme visa who can still work. People on settled status, indefinite leave to remain and the UK ancestry visa, and the spouses and partners of settled persons with a family visa, will also be eligible to work in the UK. Additionally, there are also Tier 5 youth mobility scheme holders, and from 2021 there is going to be a British nationals overseas visa. 

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