Sponsor License Suspensions

The Impact of Sponsor License Suspensions

A sponsor licence suspension means your business can no longer assign Certificates of Sponsorship (CoS) to new migrant workers and is removed from the public register of sponsors. This effectively halts your ability to bring in fresh talent from abroad, severely impacting your operations. Although your current sponsored migrants remain unaffected, you must continue to comply with all sponsor duties to avoid further penalties.

During the suspension, any applications supported by a valid CoS applied for before the suspension will only be decided once the issue is resolved, unless the application falls for refusal on other grounds. Workers granted entry clearance before the suspension can still enter the UK and start working for you, provided your licence is not revoked by the time they travel.

The ability to replace your Authorising Officer or Key Contact and add new Level 1 Users will also be suspended if these provisions were previously granted.

Failing to address a sponsor licence suspension promptly and adequately can lead to revocation, preventing you from hiring new migrant workers and potentially jeopardizing the status of your current sponsored employees.

A sponsor licence revocation has more stringent implications for your business and will typically be issued with a 12-month cooling-off period, which can significantly impact your business and foreign workers.

Common Reasons for Sponsor License Suspensions

The Home Office guidance outlines scenarios where a sponsor licence can be suspended. These are categorised into three groups:

Grounds for Suspension pending further investigation

Annex C1: Examples include:

• Providing false information on your sponsor licence application would have led to a refusal if the correct information was given.
• The Home Office believes you have artificially inflated a worker's salary to enable them to obtain indefinite leave to remain.
• Stopping, or being found never to have had, a trading or operating presence in the UK.
• Reasonable grounds to believe the role you have assigned a CoS are not a genuine vacancy.
• Failing to maintain required registration, inspection, or accreditation with a regulatory or oversight body necessary for legal operation in the UK, or never having been registered or accredited.

Circumstances Where Suspensions may be issued

Annex C2: Examples include:

• Failing to comply with any sponsor duties or lacking necessary processes to ensure compliance.
• Employing a worker without permission to enter or stay in the UK, or allowing a worker to breach their visa conditions when you could reasonably have been aware of the breach.
• Giving false statements or information, or failing to provide required information to the Home Office or any other government department.
• Asking a sponsored worker to pay some or all of the Immigration Skills Charge or attempting to recoup it from them.
• Engaging in actions or behaviours that are not conducive to the public good.

Annex C3: Examples include:

• Receiving a civil penalty not mentioned elsewhere in the guidance, deemed relevant to your ability to carry out sponsor duties or suitability to hold a sponsor licence.
• A sponsored worker not complying with their permission to stay conditions other than employment-related ones and not following good practice guidance.
• Being issued a penalty for failure to pay VAT or duty within the last five years, either as an individual or as part of an organization you were involved with in a similar role.
• Failing to confirm whether a worker requires an Academic Technology Approval Scheme (ATAS) certificate when assigning a Certificate of Sponsorship (CoS), or sponsoring a worker without the required ATAS certificate.

Sponsor Licence Suspension Process

If the Home Office is satisfied that there are grounds to suspend your sponsor licence, they will write to you and outline the reasons for the suspension. The Home Office may notify you that the suspension is pending a full investigation, and in this scenario, it is not always known how long the investigation will take.

You can write and respond to the Home Office during the suspension and investigation process. Anything you provide will be used as evidence and taken into consideration. Written responses need to be delivered within 20 days of the suspension being issued. This is your chance to provide relevant supporting evidence and explain which grounds you believe to be incorrect and why. The Home Office may give you more time to respond if they are satisfied there are exceptional circumstances.

If the Home Office discovers any new information during the 20-day period, you will be notified and given a further 20 days to respond to any new findings. During the investigation, the Home Office may also consult with other bodies, including a compliance officer, law enforcement agencies, or government departments.

If you do not respond within the 20 days, the Home Office will continue with the investigation and decide what action they will take next. The outcome of the investigation could be:

• Reinstate your licence with an A-rating.
• Reinstate your licence with a B-rating (and issue an action plan).
• Prevent you from assigning any new CoS.
• Prevent the use of any assigned but unused CoS.
• Revoke your sponsor licence.

How to Respond to a Sponsor Licence Suspension

If you receive a sponsor licence suspension letter, it is crucial to respond promptly and honestly. Failure to engage with the Home Office regarding any aspect of the process will not be viewed favourably. Here’s how you should proceed:

1. Understand the Grounds: Carefully read the suspension notice from the Home Office to understand the reasons for the suspension.
2. Gather Evidence: Collect all relevant supporting evidence that addresses the grounds for suspension. This can include documents, records, and any other pertinent information.
3. Prepare Your Response: Draft a comprehensive legal argument explaining which grounds you believe to be incorrect and why. Ensure that your response is clear, concise, and supported by the evidence you have gathered.
4. Submit on Time: Deliver your written response to the Home Office within the 20 days specified in the suspension notice. If exceptional circumstances prevent you from meeting this deadline, you may request an extension.
5. Follow Up on New Findings: If the Home Office notifies you of new information during the 20 days, prepare a further response within the additional 20 days given.

Responding to any formal notification promptly and clearly increases the chances of a favourable outcome, such as reinstating your licence with an A-rating. Failure to adequately respond or address the suspension can lead to revocation, preventing you from assigning new CoS and significantly impacting your business operations.

B-rating and Action Plan

If you are issued a B-rating, you must improve your performance to be upgraded to an A-rating within a specified time limit, not exceeding 3 months. The Home Office will provide an action plan outlining the steps you need to take to achieve an A-rating.

During the period covered by your action plan, you will not be able to add branches or new routes to your licence. However, you may assign a Certificate of Sponsorship (CoS) to a worker you were already sponsoring under the Worker or Temporary Worker routes if they need (and are eligible) to apply for permission to stay.

The Home Office will typically conduct one compliance check during the period covered by your action plan and closely monitor your use of any CoS you assign while B-rated.

If you do not meet the requirements set out in the action plan within 3 months, your sponsor licence will be revoked.

Ignoring a Suspension Notice

It is always best to engage promptly and honestly if you receive a sponsor licence suspension notice. Failure to engage with the Home Office regarding any aspect of the sponsorship process will not be viewed favourably and could impact future sponsorship licence applications.

If you choose to ignore and not respond to the suspension notice, the Home Office will continue with their process and take whatever action they deem appropriate. By not responding, you miss the opportunity to provide evidence that might reinstate your A-rating.

Impact on Sponsored Workers

The existing visas of sponsored workers remain intact during a sponsor licence suspension. However, if the Home Office decides to revoke the licence, the visas of sponsored workers will be curtailed, typically giving them 60 days to find alternative employment or leave the UK.

Assuming the sponsored workers have no role in the revocation, they can try to find alternative employment with a company with a valid sponsor licence and willing to sponsor them.

For businesses, the impact on sponsored workers can mean losing valuable employees and disrupting ongoing projects.

Compliance Visits

Compliance visits are critical in the Home Office’s decision to suspend a sponsor licence. These visits can occur before and after an organisation obtains a sponsor licence. They are designed to ensure the organisation meets the requirements and adheres to its sponsorship obligations.

As part of the sponsor licence application process, companies must have appropriate controls, processes, and systems in place to maintain compliance and be able to evidence it. Therefore, during a compliance visit, Home Office officials will expect you to provide evidence demonstrating the fulfilment of these controls.

For example, you should be able to show HR documents and procedures such as:

• Employee records
• Right-to-work checks
• Attendance logs
• Employment contracts

They may also interview sponsored employees to verify their compliance with immigration regulations. It’s essential to have the right processes in place always to be prepared for these visits, which can be announced or unannounced.

Suppose you receive a suspension notice as a result of a compliance visit. In that case, you can request copies of the Home Office’s compliance report, notes, documents, and interview transcripts related to the inspection.

Preventing Suspensions

The best way to prevent a suspension is to be proactive. Some best practices to maintain compliance include:

• Conduct Regular Audits: Regularly review your existing systems, processes, and practices to identify and address potential compliance issues before they escalate.
• Ongoing Training: Ensure employees involved in the sponsorship process receive ongoing training to understand their compliance responsibilities.
• Stay Up to Date: Keep informed about changes in immigration laws and regulations to ensure ongoing compliance.
• Thorough Documentation: Maintain detailed and accurate records of all relevant activities and communications.
• Clear Communication: Maintain open and transparent communication with the Home Office.
• Seek Expert Legal Advice: Consult with legal experts if you are unsure about any requirements.

Implementing these practices can significantly reduce the risk of a sponsor licence suspension.

Legal Assistance for Sponsor Licence Suspensions

If your sponsor licence is suspended, QC Immigration can help you understand why and respond to the Home Office with the required information to reinstate your A-rating wherever possible. QC Immigration has successfully helped companies achieve this outcome.

It's always best to be proactive and avoid a suspension in the first place. QC Immigration can provide support in ensuring your application is correct and compliant from the start. We can also take responsibility as Level 1 Users to maintain ongoing diligence and compliance, and to update and maintain good standing with the Home Office via the SMS platform.