Up to 93% of businesses risk sponsor licence revocation through non-compliance

Oct 4, 2017

About the research

Migrate UK surveyed 1,000 organisations (SMEs with 250 or less employees to large businesses with 250+ staff), who currently hold a Tier 2/Tier 5 licence to sponsor overseas workers.

  • Companies need to get ‘house in order’ to prevent loss of talent through non-compliance before the UK exits the EU
  • Key errors in ‘right to work checks, audits and job advertisements on migrant workers – only 7% of businesses advertise vacancies correctly
  • Businesses still not aware of risks and consequences of Home Office audit/compliance check, from fines to closure

The research conducted was published in The Independent on Wednesday 27th September 2017:


Up to 93% of businesses risk sponsor licence revocation for migrant workers and many are also at risk of instant Home Office closure, new research has found.

Just months before the UK is scheduled to leave the EU in March 2019, less than a third of companies are aware of the serious sanctions in place for non-compliance to strict ‘right to work’ rules for overseas workers, from fines to prison sentences for Directors, or even instant closure – not least the potential impact to business’ reputation.

Only a third of businesses knew what documents should be kept on file for sponsored overseas workers and 95% of company sponsors were not reporting all the required changes in circumstances for sponsored workers. It also found that just 7% of companies are advertising job vacancies correctly when filling a job for a non-EEA citizen under sponsorship rules, along with other key errors in business compliances, checks and audits.


Caught short

The findings revealed that businesses are not carrying out sufficient internal compliance audits to ensure internal policies, procedures and guidelines follow the required ‘duties’ of a sponsor to ensure they meet the Home Office’s stringent ‘on the spot’ compliance checks.

Whether a business is caught intentionally using illegal overseas workers, or has broken the law innocently for failing to have their paperwork in order, since July 2016 the Home Office has introduced harsher punishments from increased prison sentences to ‘on the spot’ closure for companies who are unable to meet the strict provisions of the new Immigration Act 2016.

Employers that hold a Sponsor Licence to employ a non-EU worker have an obligation to keep specific records. For example, all attendance and absences from work, evidence of a market test (where required), professional accreditations, and copies of pay slips. While they are not subject to the same penalties under Right to Work checks, just the smallest discrepancy in an employees’ data can lead to a Sponsor having their licence suspended or revoked.

Businesses also unaware of paperwork needed for British workersBritish passport

While at least 38% of businesses were found to need training on what official documents must be held for non-British/non-EEA workers, half of the businesses were also unaware of the paperwork they should keep for British workers, including an up-to-date copy of a passport photo page, or a British birth certificate including the name(s) of a least one parent or adoptive parents.

The impact of Brexit

Jonathan Beech, Managing Director, Migrate UK said: “Many businesses are already seeing a growing skills problem in the UK, particularly in the IT, finance and engineering sectors relying heavily on skills from outside the UK which will decline if companies fail to get their ‘house in order’ and prevent a loss of talent before the UK exits the EU.

While we’re being contacted by more prepared businesses who are running Brexit projects and asking us how we can help them during the lead up, as our research found, too many companies are sleepwalking towards the challenges ahead.

With a new UK immigration system said to be due in place by March 2019 when the free movement of people between the EU and the UK ends, it is likely that EEA citizens will need some kind of clearance to enter the UK to work, and sponsorship is one way they could do this. Losing a licence post-Brexit will be even worse news as skills shortages become even more acute.

Employers wishing to retain both EU and non-EEA workers need to get fully prepared ahead of Brexit. HR files should be kept for all workers, endorsed and with passport copies. Carry out internal audits to ensure all correct paperwork is in place should the Home Office make a visit. Finally, while informing EU nationals that their status has not yet changed, they should be aware of their ability to apply for a Registration Certificate, Permanent Residency or British Naturalisation if they want to safeguard their future in Britain.”