Employer’s sponsorship licence revoked after record keeping failures and failure to comply with the resident labour market test

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Sponsorship licences are essential for many businesses ranging from those who regularly employ workers who do not have the right to work in the UK to those who need senior staff from non-UK group companies to work in the UK. Employers will be exposed to significant disruption to their operations if they lose their sponsorship licence.

Your sponsorship licence may be at risk if you do not keep up with the immigration paperwork. The recent case outlined below serves as a cautionary tale and highlights the need to have tight controls in place.

Walker Morris’ specialist business immigration unit can help you to obtain and manage your sponsor licence and avoid the risks of getting it wrong as well as advise you on all of your immigration requirements.

What went wrong?

The employer ran three care homes and employed 39 “tier 2” migrant workers. Government compliance officers made a licence renewal visit to the employer’s registered address and found that it had moved premises. Its certificates of sponsorship showed the ‘old’ address but the old address was also incorrect. The Home Office also had concerns that the employer had failed to comply with the resident labour market test and other record keeping and recruitment requirements. Consequently, the employer’s licence was suspended and the letter of suspension gave the employer 20 working days to make representations and to submit evidence on the points raised. This letter included a clear warning that non-compliance would lead to revocation of the licence.

The employer wrote to make representations within the time period but, crucially, it did not provide any evidence on the points in question as it had been asked to. It subsequently received a letter revoking its sponsorship licence and applied for a review of the decision.

Court’s decision

The court said that the revocation was justified and in line with the Guidance for Sponsors. The key points in the decision were that:

  • The employer had failed to provide the missing evidence and documentation.
  • The employer had also failed to use correct procedures when seeking to correct its registered address.
  • During the period when its address was incorrect, the employer had continued to issue certificates of sponsorship falsely claiming that the address was correct.
  • The sponsor management unit had been entitled to regard that conduct as a matter for ‘serious disquiet’.
  • Revocation would normally be the outcome except in ‘exceptional circumstances. The court found that there were no exceptional circumstances in this case.


This is the first case to address the “tier 2” points-based system.

This case illustrates how easy it can be to fall foul of immigration rules by default. In a busy HR department faced with a number of conflicting priorities, failing to update an address or comply with record keeping requirements could sink to the bottom of an in-tray or fall through the net when someone goes on holiday or leaves the business. All employers must have a senior person tasked with ensuring that business immigration and sponsorship licence requirements are met with appropriate fail-safe procedures in place.

Sponsorship licences can also cause problems in business purchases, outsourcing or other situations involving TUPE. An employer may need to take steps to apply for a sponsorship licence or notify the Home Office if it acquires new employees working under a certificate of sponsorship who transfer along with the business purchased or outsourced. Otherwise, the employer risks employing workers illegally.

Walker Morris’s employment team have a specialist business immigration unit who are well placed to advise on this area. We can help with your immigration requirements by providing up to date advice and auditing your processes to ensure that you comply with the government’s immigration legislation both in terms of obtaining and managing your sponsor licence and your process and records in respect of right to work checks.