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Does your business need a sponsor licence?

Ingrid McGhee explains what the end of free movement means for your future recruitment requirements.

The UK's post-Brexit points-based immigration system came into effect from 1 January 2021 when UK employers will be required to hold a sponsor licence to allow them to recruit European nationals. For those businesses who already recruit non-EU national skilled workers to come and work in the UK, their systems will already be in place. However, new immigration rules will be extended to European nationals who could previously work in the UK under free movement rights. So, if your business currently recruits EU national staff, you should now be thinking about what the end of free movement means for your future recruitment requirements.

When to apply

If your business intends to recruit staff from outside the UK beyond 1 January 2021 and it does not already have a sponsor licence, an application will need to be made in order to sponsor the recruited individuals under the new immigration system. The sponsor licence will need to be in place from 2021.

Delays for licences may be faced as an influx of applications is anticipated from employers who need to recruit skilled EU workers. Licence applications generally take around three to five weeks to be considered but may take longer depending on how busy the UK Visas and Immigration (“UKVI”) department is. A compliance check may be required, which can cause further delay and there is also the current added uncertainty of the Covid-19 pandemic impact to consider.


Those applying for a sponsor licence must not have unspent criminal convictions for immigration offences or certain other crimes or any history of failing to carry out the sponsorship duties. Importantly, there are strict compliance obligations meaning that appropriate systems must in place to monitor sponsored employees, maintain records and report changes to UKVI.

Before applying for a sponsor licence, businesses must assign roles to key personnel. These include:

  • Authorising officer who must be a senior and competent person responsible for the actions of staff and representatives who use the Sponsorship Management System “SMS”. This is usually the most senior person in the business that is responsible for the recruitment of non-British workers
  • Key contact who will be the main point of contact with UKVI
  • Level 1 user who will be responsible for all day-to-day management of the licence.

Businesses ought to be considering the eligibility of potential roles that have tended to be filled by European nationals. As well as the need to demonstrate they have a job offer from an approved sponsor, the job offer is at the required skill level and they speak English, applicants must also meet the required minimum salary threshold or have a job in a specific shortage occupation, as determined by the Migration Advisory Committee (MAC).

Which type of licence?

There are a number of different types of sponsor licences that can be applied for. The most common is a Tier 2 licence. The Tier 2 (General) and Tier 2 (Intra-Company Transfer) visa routes allow foreign skilled workers to come and work in the UK. The Tier 2 (Intra-Company Transfer) sponsor licence allows multinational organisations to temporarily transfer overseas workers to the UK when the need arises.


An online form must be completed and the relevant fee paid. For a Tier 2 sponsor licence, this is currently £536 for small or charitable sponsors or £1,476 for medium or large sponsors. The form itself consists mainly of factual information about the business. The required supporting documents must be sent to provide UKVI with important information about your business. UKVI will review the application and may carry out a compliance visit to confirm the business is capable of fulfilling the required duties.

UKVI will carefully review all applications for sponsor licences. If it appears that the strict requirements have not been met, the application may be rejected or refused. If rejected, it is deemed to be invalid and the application fee will be refunded.  If it is refused, fees will not be refunded. Therefore, it is essential that great care is taken to ensure your application is well prepared and the supporting evidence is compiled correctly.

It is equally important to understand and adhere to the compliance responsibilities involved in holding a sponsor licence. A compliance officer from UKVI can carry out checks and any failure to adhere may result in revocation of an application thereby impacting on any foreign staff employed.

At Weightmans, we have a leading team with experience of assisting all types of organisations with immigration matters. Contact us to help us assist your organisation, fill in your details below and a member of our team will be in touch to discuss

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