Tier 2 sponsors must ensure that they file an application to renew the licence in good time to avoid losing the ability to sponsor overseas workers.
In this article we outline the process of a Tier 2 sponsor licence renewal application.
The date on which the sponsor licence expires can be found on the summary page of the Sponsor Management System (SMS), where a sponsor will also find the date on which they are able to apply to renew the licence.
In general, a sponsor can apply to renew its licence up to three months in advance of the expiry date but on occasion the Home Office will invite a sponsor to apply earlier.
In order to renew the licence, a sponsor will be required to submit a request within the SMS and pay the appropriate fee. The application fee varies depending on whether a company is classed as small, medium or large and it may well be that where a company was classed as a small company when making the initial sponsor licence application it has since grown and would now be classed as a large company. UKVI apply the Companies Act 2006 classification to decide on the size of a company. The renewal fee for a sponsor who has charitable status or who is subject to the small companies’ regime is £536 whilst medium or large sponsors will be required to pay £1,476. If the incorrect fee is paid, then the renewal application will be rejected.
It is recommended that where a sponsor wishes to retain the Tier 2 licence, a sponsor licence renewal application is made in good time. If an application is rejected prior to the licence expiry date, then a sponsor is able to submit a new renewal application and the licence will continue until a decision has been reached. A sponsor that misses the application deadline or has their application rejected after the licence expiry date will be removed from the register of sponsors. A sponsor that does miss the deadline but wishes to retain the sponsor licence will be required to submit a new application which will be considerably more complex than a renewal.
Prior to submitting a Tier 2 sponsor licence renewal application, the employer should ensure that all details displayed on the summary page of the SMS are correct and have been fully updated. This includes checking that the address showing on the system is the current address and that details of the Authorising Officer and Level 1/2 users are correct. If any of the details displayed are out of date or otherwise incorrect then a report should be made to update these details prior to a renewal request being submitted.
A sponsor should also ensure that where applicable any new sites have been added to the licence and that all reporting has been completed.
When a Tier 2 sponsor licence renewal request is received by UKVI, they will make checks as outlined in the Modernised Guidance in order to determine whether the company is:
- “Operating legally in the UK
- Still suitable to be a licensed sponsor
- Able to meet their duties at the level we expect”
In the majority of circumstances, information held by Companies House will be reviewed in order to check that the company is still operating legally in the UK. If no information can be found on Companies House or through online searches, an employer may be contacted to provide evidence that they are legally operating prior to the licence being renewed. Tier 2 sponsors are not always required to submit documents when renewing a licence but UKVI may ask for them and paragraph 22.15 of the Sponsor Guidance states that ‘if we write to you to ask for any information or documents, you must send them within 5 working days. If you do not send the documents within this time, we will take action against you’. Whilst this action could be a suspension or downgrading of the licence, it is probable that if the requested documents cannot be provided in time, that the licence will not be renewed. It is therefore important that prior to submitting a request to renew a sponsor licence, a sponsor ensures that its paperwork is up to date and that it is able to produce any relevant documents as listed within Appendix A of the Sponsor Guidance.
In order to assess whether an organisation is still suitable to be a licenced sponsor, the UKVI will look into the sponsor’s immigration history, review any Certificates of Sponsorship (CoS) which have been assigned and may request further information regarding the organisation’s need for a sponsor licence and how they have used it in the past. If the UKVI considers that there may be a potential risk to renewing the licence then they may provisionally extend the licence prior to completing a compliance visit to the sponsor. The Modernised Guidance at page 57, states that risk of a compliance visit in this case is extremely high if a sponsor has previously ‘had a tier 2 migrant application refused on the grounds of non-genuine vacancy’.
During a compliance visit UKVI may interview sponsored staff to ensure they are only carrying out the work they are sponsored to do and will look at recruitment procedures in order to ensure that all sponsored roles meet the genuine vacancy test as referred to in paragraph 15.15 of the Sponsor Guidance. They will also use the compliance visit in order to assess that an organisation is able to meet its sponsor duties. Prior to making an application to renew a sponsor licence, an organisation should therefore ensure that all documentation is up to date and would be easily available to show to a compliance officer. Further information on how to prepare for a compliance visit can be found here.
Further factors to consider
It remains to be seen how UKVI will treat applications for renewal where a sponsor has received a civil penalty. The Sponsor Guidance at paragraph 1.10 states that ‘if you are issued with a civil penalty for employing illegal workers your licence may be suspended and any new licence application may be refused’. It is highly probable that a sponsor that has received a civil penalty will receive a compliance visit from UKVI. Those who cannot then show that they are meeting their duties especially in relation to the prevention of illegal working are likely to have their renewal application refused.
As the sponsor system has been in place for almost eight years, UKVI expect that sponsors should by now be aware of their duties and are becoming increasingly intolerant towards those who do not fully comply. Whilst sponsors who are compliant and have a genuine need for their sponsor licence should have no cause for concern, the sheer amount of duties and obligations placed on a sponsor means that many are unintentionally failing in their duties. Sponsors that are concerned should therefore act now to ensure that they have sufficient procedures in place to successfully handle a compliance visit and achieve a positive result for their Tier 2 sponsor licence renewal.
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