Sponsor License

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The Home Office has issued instructions for sponsor licence applications. This reflects changes to UK immigration rules that took effect in December 2020. The new Skilled Worker visa has replaced the Tier 2 (General) visa for sponsored employment.

Companies must have a valid sponsor licence to employ skilled workers from abroad who are not permitted to work in the UK, including EEA and Swiss nationals and their family members who have not been granted settled or pre-settled status under the EU Settlement Scheme.

What exactly is a sponsor license?

A sponsor licence (formerly known as a Tier 2 sponsor licence) enables UK-based companies to hire skilled workers from abroad or within the UK (applicants can “switch” to the Skilled Worker visa from other visa types, including Tier 4 Student and Tier 2 visas).

Once approved, the license is valid for four years with the option of renewal.

When will I need a sponsor license?

There are two scenarios where you will need to obtain a sponsor license. If you want to employ a skilled worker from outside the EEA and Switzerland, you will need to apply for and obtain a Tier 2 sponsor license. If you are a recognized education provider and wish to have students from outside of the EEA and Switzerland, you will need to apply for and obtain a Tier 4 sponsor license. The Visa Application processes for a Tier 2 or a Tier 4 sponsor license are subject to stringent criteria.

Before applying for a sponsor license, you should work with a lawyer who has specialist knowledge in this field. You will need to ensure all of your business policies and processes are in line with current regulations.

Before you start

Before applying for a sponsor license, you should work with a lawyer with specialist knowledge in this field. You must ensure all your business policies and processes align with current regulations.

There are requirements that you must be able to meet to be considered for a sponsor license:

You will not be considered for a sponsor license if you have previously rejected applications.
When employing an overseas worker, you must prove that the employment or education you intend to offer is genuine. you must provide an adequate salary for that position.
You must demonstrate that you have proper monitoring systems for your sponsored student or employee.
A business must operate lawfully within the UK and be a bona fide company.
An employer must have failed to recruit a suitable worker.

What is a small sponsor?

A company is considered a small sponsor if two out of the following conditions are met:

your total assets are worth less than £5.1 million
you have 50 or fewer employees
your annual revenue is less than £10.2 million

Prerequisites for obtaining a sponsor license

To apply for a sponsor licence, your organization must have a UK presence and legally operate or trade in the UK. If you have numerous UK branches, you may apply for a single licence to cover all of your linked UK entities; alternatively, depending on your circumstances, you may apply for separate licences for each branch.

If are regulated or inspected/monitored by a statutory body in order to operate legally in the UK, you must provide proof that the company (and any branches covered by the licence) are fully compliant and registered with the appropriate body. You may also be required to provide evidence that you have the necessary planning permission or local planning authority consent to operate your type of business at your trading address.

Further Requirements

The Home Office must be convinced that you can provide employment in a skilled occupation and that you will comply with the rate of pay specified by the Home Office.

As part of your license application, you agree to accept all the responsibilities of being a sponsor licence holder.

Private individuals are not usually eligible to be recognized as sponsors, but there is an exception if the applicant is a sole trader who wants to sponsor someone to work in their business.

UK Visa Types

What is the cost of applying for a sponsor license?

The size and type of organization determines the cost of a sponsor license. This application fee must be paid each time the sponsor renews their license (every four years). The Home Office reviews fees annually and publishes them on its website.

Sponsor licence fees of £1,476 are required for organizations classified as “medium” and “large.” This fee would be levied on all organizations not classed as a “small” sponsor.

Other UK Visa Types

A Visa is required for any foreign national wishing to enter the United Kingdom.

UK Family Visa	UK Refugee Visa	UK Transit Visa
UK Standard Visitor Visa	UK Study Visa	UK Business Visa
UK Work Permits	UK Spousal Visa	UK Settlement Visa
UK Parent Visa	UK Child Visa

What exactly is a sponsor license rating?

A-rating
B-rating

You will be assigned an A rating if your sponsor licence application is approved. The Home Office awards this rating to trusted organizations that have demonstrated that they have the necessary systems to comply with sponsor duties.

To keep their A-rating, sponsors must maintain their systems and policies. The Home Office reserves the right to re-assess at any time, and these compliance visits will determine whether an organization still meets the criteria for an A rating.

If the Home Office discovers that a company is not fulfilling its sponsor duties, it may be demoted to a B-rating. To regain their A-rating, a B-rated sponsor must follow a time-limited action plan. If they fail to meet the requirements of the action plan within the timeframe specified, their license will be revoked.

It should be noted that the Home Office can suspend or revoke a license without first downgrading to a B-rating. The gravity of the violations discovered will determine the Home Office’s course of action.