Who may apply for a Tier 2 Sponsor Licence
Virtually any business can become a registered Tier 2 Licence holder and sponsor an overseas worker.
If you consider applying for a sponsorship licence, you will need to demonstrate that you have
- a genuine business,
- a genuine need for the sponsor licence, and
- a suitable system for prevention of illegal working and UKVI compliance.
This is not much and most business would expect to be successful provided they have the right procedures in place. The application may fall for refusal if any one of the above factors is deemed not satisfactory. There may be a cooling-off period of six months before you can re-apply. It is thus most important to have the application prepared carefully and with expert knowledge of the UKVI’s expectations. This way you will get it approved on the first try.
How the application is made
The application for a Tier 2 Sponsor Licence is made online by the employer. Once the application is submitted, the employer has five days to post supporting documents to the Home Office. There should be at least four documents, prepared and presented in the right format. The documents are aimed at demonstrating that the application is made on behalf of a genuine business.
Examples of accepted documents may include the VAT registration certificate, a licence for the business premises, HMRC issued documents, employer liability insurance and such like. The Home Office has strict requirements regarding authentication of documents that cannot be submitted in the original and failure to follow the authentication requirements may lead to the rejection of the document and refusal of the application.
The other limb of the application is to show that the business has a genuine need for the sponsor licence. There are various ways of addressing this requirement and a detailed discussion of this aspect of the application is normally part of our work in assisting the sponsor with the application.
In some circumstances, the sponsor may have to do the resident labour market test before applying for the licence. However, this is not a rule of thumb and we advise our clients on whether this requirement applies in the initial consultation.
Resident labour market test and why employers should instruct professionals to carry it out for them
Whether the application is made from within the UK or from abroad, precedence has to be given to the settled workers.
Nominally, the resident labour market test is designed to ensure that local workers can apply first. In practice, the test rarely results in finding the right applicant. But is very prescriptive, and we strongly recommend that it is done with professional help.
One of the problems of not following the correct procedure is that the mistake may only come to light when it is too late to correct them.
Initially, the employer would only be required to make a declaration that the test was met and no resident worker was found. However, the Home Office may ask for evidence at the stage of the application for a certificate of sponsorship, or when the employee is applying for the visa, or during an immigration compliance visit which may take place when the employee is already well settled in the job.
The later the mistakes come to light the more unpleasant the consequences may be. Sometimes disproportionately so. It can be devastating for an employee to leave the country and give up the job due to an error completely beyond their control. For the employer, the fines and loss of a member of staff is also a serious blow.
As legal representatives of the employer, we would always keep the relevant screenshots of advertising, details of the wording and evidence of the prescribed information to make sure that our clients are never fined or otherwise penalized for non-compliance.
Pre-licencing compliance visits
The Home Office may do a compliance visit before making a decision on the licence application. The purpose of the visit is to check if the organisation will be capable of carrying out the sponsor’s duties. In this assessment, the visiting officer will review the employer’s HR procedures, and may interview the employer in relation to the proposed sponsorship.
The Home Office processing time for a sponsor licence application can take up to 16 weeks. In practice, we expect a decision in 3 – 8 weeks.
Some frequently asked questions
What is the difference between a Tier 2 General and a Tier 2 ICT licence?
Tier 2 ICT licence (or Intra-Company Transfer) for employers who wish to transfer senior employees from an overseas branch of the business to the UK based branch or affiliated entity. The worker should either have been with the employer for at least 12 months before the transfer or be paid in the UK an annual salary of not less than £73,900.
This visa may be used for short term assignments or longer periods, normally of up to five years. For high earners (with salaries over £150K per year) Tier 2 ICT visa can be issued for up to nine years.
The worker is expected to return home on completion of the assignment. There is no right to apply for indefinite leave to remain.
With the exception of short periods of sponsorship of up to three months, a cooling-off period applies after the Tier 2 ICT worker leaves the UK. This means the employee cannot return to the UK on a new Tier 2 visa for 12 months.
Tier 2 General licence allows the employer to sponsor a non-British worker whether or not the worker previously worked for the employer. The maximum permitted stay in this category is six years. However, the worker is entitled to apply for indefinite leave to remain after five years of sponsored employment.
What is a certificate of sponsorship?
Certificate of sponsorship is a document issued by the Home Office on request of an authorised sponsor. Certificate of sponsorship is then used, or assigned, by the employer to the worker. This begins the sponsorship process.
There are two types of certificates of sponsorship: restricted and unrestricted.
An unrestricted certificate of sponsorship can be issued to a migrant who is already part of UK labour market (is already sponsored in the UK either by the same or another employer) or is a Tier 4 student who has completed studies and is switching to Tier 2 General route.
A licence holder has an annual number of allocations, in other words, the number of unrestricted certificates of sponsorship that they can issue at any time without asking the UKBA for special permission to do so.
Restricted certificates of sponsorship are issued by the Home Office upon a request from the sponsor for the purpose of employing a worker from abroad. These certificates are limited in numbers, hence the term “restricted”. They are issued monthly by the Home Office and are subject to competition. Points are awarded depending on whether the job is on a shortage occupation list and in proportion to the remuneration of the prospective employee.
Applications for restricted certificates of sponsorship are accepted monthly, with a cut off date on the 5-th day of the month. The decision is normally made on or around the 11-th day of the month and notified to the employer on the next business day.
Once the employer has received the certificate of sponsorship, it can be assigned to the specific worker and the sponsorship process begins.
The worker should apply for entry clearance within three months of getting an assigned certificate of sponsorship.
Applications for certificates of sponsorship and assignment of the certificates is done through the online Sponsor Management System (SMS). Most employers appoint their legal representative as the level 1 user of the SMS to avoid any mistakes which may lead to the annulment of the certificate or even suspension or revocation of the licence.