How to renew sponsor licence - NEW 2021 Guide

A sponsor licence is issued to qualified UK employers for a period of 4 years. With the licence, an organisation is authorised to hire non-UK resident employees and also carry out certain responsibilities to ensure utmost compliance in their recruitment and business operations in accordance with the UK immigration and labour systems.

The licence must be renewed before its expiry date if the sponsor still wants to continue hiring immigrant workers. As a licenced employer, you must request for your licence renewal by paying the appropriate fee and submitting a renewal application on the Sponsorship Management System (SMS). If your licence is due for renewal and you are wondering how to go about it, this article gives you a complete guide on the requirements and process for the renewal application.

When to Renew Your Sponsor Licence

You are required to renew your sponsor licences every four years before the expiry date of the current one. You can submit the application any time from 3 months before the expiry date. You can view your licence expiration and the earliest date for renewal application in your sponsorship management system (SMS) account.

The Home Office will send you a reminder to renew your licence 120 calendar days prior to the expiry date. Other reminders should also follow at 30-day intervals, and up to the very last month, before you will get a final reminder two weeks to the scheduled expiry date. This is one of the essences of keeping your contact information on the SMS up to date to ensure the appropriate personnel will receive the reminders and do the needful at the appropriate time.

Steps to Renewing Your Sponsor Licence

To renew your sponsor licence, you will go to theSMS system and follow the instructions below.

- Step 1: Go to the Licence summary, application and services screen, and then select Licence renewal.

- Step 2: Once you are on the Licence renewal introduction screen, you will select the appropriate fee and then click Next. (NOTE: If the next button is not available (greyed out) that means you are not eligible to renew your licence at this time. You should check the Licence summary screen to know when you will be able to renew your licence).

- Step 3: Once you are on the Licence renewal declaration screen, you will fill the boxes with the date, your name, and your position in the company. After completing the information, you will select Continue.

- Step 4: Now, you will be taken to the Licence renewal payment screen. Select OK and proceed with the transaction, using Worldpay (the contracted third-party payment service for your renewal application payment).

- Step 5: After completing the payment process, the Licence renewal submission successful screen will be displayed. Here you will select the Submission sheet.

- Step 6: You should print and save a copy of the submission fee for your own records. You do not need to send it to the Home Office.

If you are able to complete step 1 to 6, that means your renewal application has been successfully submitted and will be processed by the Home Office. You can monitor the progress of the application using the “Applications and renewals tracking” menu in SMS.

What You Need to Know Before Submitting Your Renewal Application

Before submitting your sponsor licence renewal application, ensure that the details in your SMS account are up to date. If there have been any changes in the information about your business, your key management staff, and sponsored employees, ensure that the latest information reflects on the system. This includes the contact details of your Authorizing Officer and Level 1 and 2 users. Also, if you have added new sites, ensure that any new sites are captured on the system before submitting your renewal application.

Documents Submission for Licence Renewal

Generally, licenced sponsors are not required to submit documents during the renewal process. However, if there is a need to get certain documentary evidence from you directly, UKVI will write you to request for the specific information they need.

In this case, you must submit the required documents within five working days. Failure to send the documents within the stipulated time will attract action against you. This could lead to the suspension or downgrading of your licence, which in any case, could mean that your licence will not be renewed.

Sponsors Who Need to Provide New Documentary Evidence for Renewal

Your licence category, as well as the line of business your company operate, may determine whether UKVI will request documentary evidence from you during the renewal process.

Example:

If you are a Tier 2 (Sport) or Tier 5 (Creative and Sporting) sponsor, you will be asked to provide a sport governing body endorsement.

If you are a Tier 5 (International Agreement) sponsor related to a consular or diplomatic mission or international organisation, you may be asked to provide a signed letter from the head of the mission, the consulate or the organisation’s office in the UK. The signed letter must indicate that the authorising bodies:

· Agree to the licence renewal application

· Are willing t continue to sponsor the migrants under Tier 5 - (International Agreement) Accept the sponsorship requirements to:

i. give the Home Office express consent to enter their premises

ii. accept the limited waiver of diplomatic privileges and immunity to allow the Home Office to conduct any compliance activity as set out in the published guidance.

Renewal Application Fee

The renewal fee varies widely, depending on the size of your company. Large or medium organisations pay a higher amount compared to small scale and charitable organisations. Before submitting your application, you should know the appropriate fee that applies to your business status and pay accordingly. Paying an incorrect fee can lead to your application being refused.

Licence Type Small or Charitable Sponsor Medium or Large sponsors

Tier 2 Skilled Worker £536 £1,476

Tier 5 £536 £536

Tier 2 & Tier 5 £536 £1,476

Based on Companies Act 2006, your organisation will be categorised as a small company if it meets the following criteria:

· Its average number of employees NOT more than 50

· Has annual turnover that is NOT more than£10.2 million

· The balance sheet total is NOT more than£5.1 million.

If your organisation does not meet the above descriptions, then you will have to pay the fees for a medium or large company.

How Does UKVI Conduct Sponsor Licence Renewal?

When you submit your sponsor licence renewal application, UKVI will check whether the application is valid or not. This is called validation checks, and it is done to determine on what basis should ab application be rejected or accepted.

Licence Renewal Validation Checks

UKVI officials will determine the validity of an application by checking the following three factors:

- The Licence Status

- The Application Fee

- Completion of Any Outstanding Change Requests

Licence Status Check

During the status check, the UKV official will find out if your licence is A-rated and active, B-rated, or suspended. If the licence falls into any of these three categories, then your application for renewal will be considered valid.

On the other hand, if the licence shows to be dormant, revoked, or surrendered, then a further review will be made to determine what led to the current status. For instance, in a surrendered licence case, if the sponsor is subject to a takeover or merger, the official will check further to determine if the case should be passed to the post-licence team.

In general, however, a licence renewal application will most likely be rejected if the licence has been made dormant, or the status is surrendered or revoked.

Application Fee Check

Your renewal application will only be considered valid if you have paid the appropriate fee. The fee will be determined by certain factors which include tier and category of the licence, the size of your company, and whether it has charitable status.

There is also a guideline in the case of an incorrect fee. If you have overpaid, the official will refund your balance and continue with the casework. But if you have underpaid, your renewal application will be rejected.

Outstanding Change Requests Check

UKVI conducts this to determine whether you have outstanding change requests that need to be resolved.

Other Factors to Consider

UKVI also check to determine whether your company:

· Is operating legally in the UK

· Is still qualifies to be a licenced sponsor

· Has all it takes to carry out their duties to the level expected

To determine whether your company is operating legally in the UK, UKVI will check theCompanies House website for the necessary information. If they cannot find the needed information on the Companies House Website, they may contact you to provide the information needed.

To determine if you are still suitable to be a licenced sponsor, UKVI officials will evaluate your immigration history and review all cases of Certificates of Sponsorship (CoS) that have been assigned by your company. They may also request more details regarding your company’s needs for a sponsor licence and how you have used the licence in the past.

If their findings show that there may be a potential risk if the renewal application is approved, they may provisionally extend the licence pending when a compliance visit will be made to your business location. One of the major factors that pose the highest risk is if you have had a migrant sponsorship application rejected on the basis of non-genuine vacancy. This will most likely warrant a compliance visit.

UKVI Compliance Visit for Sponsor Licence Renewal

If the officials deem it fit to pay a visit to your business location, a compliance team will be sent. During the visit, they will carry out various checks to determine whether your renewal application should be approved or not.

The officials may evaluate the situation on grounds to determine whether you have been complying with your sponsor management duties and still meet the requirements to continue complying.They may also decide to interview your sponsored migrant staff to determine whether they have been performing the exact tasks for which they were hired during recruitment.

This is why it is best to put your company in order before submitting a request for renewal. Make sure all immigration and recruitment documents are up to date and are accessible to the UKVI officials during their visit. If the compliance officer is unable to or restricted from accessing necessary information at the visit, there may be consequences which will not only affect your chances of renewal approval but may also affect your chances of being able to sponsor migrant workers in the future.

Why You Must Renew Your Sponsor Licence Before Expiry Date

Failure to renew your application before its expiration attracts certain consequences which will affect both your business and migrant sponsored employees. According to the UKVI, failure to renew before the expiry date can lead to any of the following scenarios:

· If you fail to respond to the invitation to renew your licence before the scheduled expiry date, the existing licence will expire on the scheduled date for expiry, and you will no longer be eligible to act as a licenced sponsor from that date.

· If you fail to renew your licence and you still have sponsored migrant employees after the expiry date, management information (MI) report will be issued to notify the migrant casework teams to curtail their leave.

· In the event that you do not wish to renew your licence (probably because you no longer have sponsored migrants and will not need the licence in the future, it is best to do so officially. To do this, you will use your SMS account to decline renewal. This will lead to the automatic expiration of the licence on the scheduled expiry date, and you will no longer be eligible to act as a licenced sponsor.

In addition to the above scenarios, applying early will also give you enough time to prepare in case an unforeseen situation arises. For example, if your renewal application is refused, you will be able to prepare for a new licence application before the expiry of the current one. This will prevent subjecting your sponsored migrant workers from being flagged for unlawful presence and employment in the UK. Keep in mind that it is a violation of the UK immigration law to keep having sponsored migrant worker in your workforce if you (the employer) don’t have a valid sponsor licence.

Common Grounds for Sponsor Licence Renewal Application Refusal

The Home Office puts employers under more serious scrutiny during the renewal than the initial licence application process. This is because they want to be sure that in the past four years of holding the licence, the employer has performed up to the standard and has not in any way, abuse the process. In addition, they will also want to ensure that the employer still has the requirements to continue performing their expected management roles. Unfortunately, not all employers will pass this litmus test, and this may lead to some renewal application being refused. It is best to pay attention to those potential pitfalls and avoid them. Some of the reasons for refusal of sponsor licence refusal by UKVI include:

· Non-compliance with your sponsor licence responsibilities and duties

· Not promptly reporting changes in your company and workforce

· Failure to keep records up to date

· Not responding to UKVI enquiries in due time.

· Not following due process in offering employment to migrant workers, especially the vacancy advertisement requirements.

· Carrying out incorrect Resident Labour Market Tests or not keeping adequate records of the tests.

· Paying an incorrect renewal application fee

Consequences for the above scenarios may be beyond the refusal of your renewal application. It could lead to downgrading, revocation or suspension of your sponsor licence. The punishment may come in the form of civil penalties, fines, or criminal charges – in the worst-case scenario. This is why the importance of complying to all the Home Office requirements cannot be overemphasised.

Sponsor Licence Renewal FAQs

Will my renewal application be granted if I have received a civil penalty?

The Home Office does not expressly state the specific punishment for a civil penalty. But it clearly states that if you have been issued a civil penalty for employing illegal employees, your licence may be suspended and any application for a new licence may be refused. So, reading between the lines, you should expect more stringent scrutiny compared to other applicants without a civil penalty. There is a high chance of having a UKVI compliance team visit your business site as part of the process to scrutinise your application.

I’m afraid I have not performed my sponsor management roles up to the required standards. What can I do to avert renewal application refusal?

If you have not been up and doing in your management roles, the good news is you can still make amendments before you submit a renewal application. Go through all the records of the immigrant workers you have sponsored since the issuance of your licence, ensure the records are up to date, and there is no potential risk for violation of the immigration law. Also, go through the details of your key allocated staff managing the SMS and ensure that the information you earlier gave submitted about them is still valid. If there have been any changes since then, make sure you update the SMS to reflect those changes. In essence, just ensure you tighten all the loose ends before sending your renewal application to the Home Office. And the best time to start all these preparations is six months to the expiry date of the licence.

If I fail to renew my licence before the expiry date, does UKVI offer a grace period?

According to UKVI, failure to respond to the invitations to renew your licence before its expiry date means you are no longer eligible to act as a licenced sponsor from the scheduled date of the expiry. However, you may still be able to submit an urgent application to the Home Office. But in such a case, your chances of getting the application honoured is quite slim, and you should expect much a much costlier and stressful process.

So, given the importance of the licence to your business operation and the number of notifications from UKVI, it is best not to wait for any grace period, but rather do the needful at the appropriate time. There have been cases of employers not knowing about their licence expiry until much later probably when one of their employees request a further leave to remain. This can happen when employers don’t update their contact details on the SMS and aren’t getting important notifications from the Home Office. If you find yourself in such a situation, you might need to seek legal advice to know your best bet between an urgent renewal application or applying for a new licence entirely.

How will my expired sponsor licence affect my sponsored migrant employees?

An expired licence will not only affect your chances of sponsoring prospective workers; it will also affect your existing sponsored migrant workforce in a number of ways.

Firstly, once you are no longer eligible to act as a licenced sponsor, your migrant workers will have 60 days to (or up to the expiry date of their visa if earlier) to leave your organisation to get another licenced employer who will sponsor them for a new visa application. If they cannot get a new sponsor within the 60-day period, then they will have to leave the UK.

Secondly, your sponsored employees could face legal action, including detention. For example, there have been cases of imigrant workers being detained for violating their immigration status after making attempts to reenter the UK, not knowing that their employer's licence has expired.So, an expired licence can cause your personnel and business so much stress and embarrassments that are avoidable in the first place.