Insight: Requirements for a sponsor licence application

To employ a non-UK national who is not already with a type of status in the UK, employers need a sponsor licence. There are two types of sponsor licences, depending on the type of work you need covering, the temporary worker licence and the workers licence. 

The temporary worker licence covers the following: 

• Scale-up workers
• Creative workers
• Charity workers
• Religious workers
• Government authorised exchange
• International agreements
• Global business mobility workers (except senior or specialist workers)
• Seasonal workers

The workers licence covers:

• Skilled workers
• Senior or specialist workers 
• Minister of religion 
• International sportsperson

We will focus on employers obtaining a workers licence. These requirements are separate from the workers’ own requirements for making an application for a skilled worker visa, which are discussed in our earlier article covering Skilled Workers. 

There are four main requirements the Home Office will assess a sponsor licence application against when considering to grant an employer a sponsor licence. These are: 

• The business needs to be eligible (genuine, trading)
• They need to nominate a level 1 user, key contact and authorising officer who are honest, dependable and reliable.
• They need to nominate a level 1 user to manage the Sponsor Management System (SMS) who is a settled national/British, residing in UK and an employee, director or partner.
• The company must have adequate human resource systems in place to show good record keeping of absences, right to work documents, employee contact details, contracts, NI numbers etc.
• The role they wish to fill needs to be suitable (highly skilled, on occupation list, genuine need for the job to be filled)

We will look at each of these requirements in turn.

The Home Office determines whether a business is truly genuine and operating within the rules of UK law by requiring at least four mandatory documents from Appendix A to be provided. These documents can include a recent business bank statement, VAT certificate, employers’ liability insurance certificate etc. Depending on the type of organisation they are and workers licence they wish to obtain, they may need to provide other evidence, such as charitable status, or information on their religion.

The people in charge of the sponsor licence (key personnel), which can either be three separate people or all one person, must not have been charged with any immigration offences or civil penalties as listed in Appendix B and Appendix C.

This declaration needs completing on submission of the application form.

There are requirements that are general to all key personnel, and then some which are specific to the level 1 user. All key personnel must reside in the UK and be a paid employee or ‘office holder’. Office holder includes people ‘appointed to a position by a company or organisation but does not have a contract or receive regular payment’.

Then, there are additional requirements for level 1 users. As they will be assigning the certificate of sponsorship to the worker, they must not be related to the worker in any way. They must also be specifically an employee, director or partner at the organisation. They must be British or a settled national (someone with indefinite leave to remain or settled status).

Appendix D sets out the kind of documents that must be stored on the system when holding a sponsor licence, and it is best to show the Home Office that the organisation already has the means and knowledge to do this at the application stage. Documents include right to work documents, national insurance numbers, contracts of employment and other relevant documentation.

Records also need to be kept of workers’ which includes absences so that the organisation are able to comply with their reporting duties. Instances of workers missing work with notice must be reported to the Home Office by the level 1 user via the sponsor management system.

Finally, but perhaps most importantly, if the organisation have already identified the worker they wish to hire, they must ensure that this role is eligible to be sponsored, and there is a business need for this recruitment. In doing so, they must show that it meets the requirements as set out in our earlier article covering Skilled Workers, and the 2024 changes to the Skilled Worker route as updated in the recent brief.

All fees are upfront and depend on the size and type of the organisation. These are the fees that have to be covered by the organisation.

Therefore, the organisation will at a minimum incur the associated fees:

• Sponsor licence application filing fee – £536 for a small/charitable sponsor, £1476 for a medium/large sponsor
• Certificate of Sponsorship fee – £239 per worker
• Immigration Skills Charge – £364 per year of sponsorship for a small/charitable sponsor, £1000 per year for a medium/large sponsor

Other fees which employers can chose to cover other being granted a sponsor licence includes the worker’s visa application fee and the worker’s Immigration Health Surcharge.