Common Skilled Worker Sponsorship Pitfalls

Listen as Al Harvey and Briar Koko look at the common mistakes made by businesses when administering their own Skilled Worker Sponsor Licences.

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Briar: Welcome to the Business Immigration podcast on the Common Skilled Worker Licence Pitfalls. My name is Briar Koko, I'm a senior paralegal here in the Doyle Clayton Business Immigration team. I'm joined today by Al Harvey, an Associate, who specialises in the Skilled Worker sponsorship route.

Al: Hi Briar, nice to be here.

Briar: Thanks for joining me. Today, we're going to be looking at common mistakes made by businesses administering their own skilled worker sponsor licences. It can be very overwhelming navigating the rules and the Home Office guidance, many clients do come to us after they have attempted to handle matters themselves. Today in this podcast we will summarise the issues we tend to come across in practice. 

Ensuring that you are assigning a COS correctly

The first issue we often see is assigning a new entrant COS (certificate of sponsorship) incorrectly. Al, can you talk to me about this?

Al: Yeah, so the COS, or the Certificate of Sponsorship, is assigned by a sponsor to a Skilled Worker, in this case, and is needed by the individual in their visa application. When assigning the Certificate of Sponsorship, you have to pick a subcategory and one of those is for ‘new entrants’ to the profession. Many sponsors tend to think that ‘new entrants’ means individuals who have not held a Skilled Work visa before, but it's actually a defined term, found in the immigration rules and it includes applicants under the age of 26, recent students and graduate visa holders. The benefit of the new entrant route is that the individual benefits from a lower salary threshold and it is considerably lower, 70% of the going rate, compared to the full salary requirements.

Incorrectly relying on the ‘new entrant’ provisions could actually result in a visa refusal, so it is important that sponsors are aware of the distinction when assigning a Certificate of Sponsorship, and they’re sure that the applicant in question does in fact meets the ‘new entrant’ requirements. It's also worth bearing in mind that ‘new entrants’ are limited to four years under the Skilled Worker route as a new entrant, including time spent time as a graduate. So, it's very important to ensure that when assigning a Certificate of Sponsorship: one, you are sure that the ‘new entrant’ is in fact a new entrant in accordance with the immigration rules and two, the length of time you're looking to sponsor the individual for falls within the permitted cap.

Briar: It's an easy mistake to make that one, thank you Al. The next common issue that we see is selecting the Skilled Worker (graduate in Tier 4 /student route switching to Skilled Worker) Certificate of Sponsorship option when assigning a COS to a Graduate visa holder, can you expand on that Al?

Al: Yeah, so this is one we see quite often actually. So, the Certificate of Sponsorship, the subcategory in question, is entitled ‘Graduate in Tier 4/student route’, and I think a lot of people read the word graduate and assume it applies to those who currently hold a Graduate visa, so a post study visa, but it's actually intended for those currently holding a student /Tier 4 student visa. It's an important distinction because relying on this type of subcategory of Certificate of Sponsorship does not incur the Immigration Skills Charge, which for medium and large sponsors, is £1000 per year.

Briar: Certainly, makes a difference, doesn’t it?

Al: It certainly does, and one of the benefits of switching immediately from a Student visa to the Skilled Worker route, is that you are exempt from the Immigration Skills charge. But often we do see sponsors incorrectly assigning Certificates of Sponsorship to Graduates under this category and therefore not incur any Immigration Skills Charge.

There are issues with this, best case scenario, the Home Office get in touch with you, send you a payment link so that you can pay the missing Immigration Skills Charge. Worst case scenario, they refuse the application because it's incorrect, the Certificate of Sponsorship which has been assigned is incorrect. So, for your Graduate visa holders who you're looking to be sponsored as Skilled Workers, you should be assigning the Switching Immigration category Certificate of Sponsorship, not the confusingly named Graduate in Tier 4/Student route Certificate of sponsorship.

Briar: Thanks Al.

Keeping an eye on your undefined COS levels

The next common pitfall we'd like to discuss is running out undefined COS and then having an urgent need for one. We see this quite a lot in our practice, can you talk to me about that?

Al: Yes, so historically sponsors would every year need to, well the majority of sponsors anyway, would need to manually top up their undefined Certificate of Sponsorship numbers, depending on their anticipated needs for the forthcoming allocation year. These figures now, or these numbers, are now automatically topped up based on historic use.

Briar: It's all changed, hasn't it?

Al: It has, yes. So recently actually Home Office have changed, they've automated it so that essentially you are given an allocation which should be based on how many Certificates of Sponsorship you used in the previous year, which could mean insufficient need for your recruitment plans. In that case, the onus is on you, as a sponsor, to manually top up or request additional undefined Certificates of Sponsorship. Often the realisation of this comes about when there is an urgent recruitment need, or perhaps you've got an individual (current sponsored migrant) whose visa is coming up for renewal and you need an undefined Certificate of Sponsorship to extend their stay. The problem is that standard processing for undefined Certificate of Sponsorship top ups is up to 18 weeks.

Briar: A long time.

Al: It is a long time, and for most people it's too long, particularly if you've got visas expiring or you've got potential new hires in the pipeline waiting to join, 18 weeks could be a barrier for many. There is the option to prioritise the request, but these requests are very few in number, I think it's 60 slots a day.

Briar: That's right, they're very hard to come by.

Al: They are, you need to e-mail at 9AM on the dot, or if not slightly earlier, 8.59AM, to request a priority slot. Having spoken with other practitioners, it can take days or weeks to secure a slot. It seems a slightly archaic system, but there is discussion about it potentially being automated. Some practitioners have had success in marking their emails as urgent, but if you are unable to secure that priority slot, your hands are somewhat tied and in the circumstances, it can leave people really unsure what to do, particularly if they've got pressing deadlines or visa expiry dates coming up.

It's just worth bearing in mind that as a sponsor, I’d recommend sponsors are regularly logging into the Sponsor Management System to check how many undefined Certificate of Sponsorship they do have, and perhaps, making a request for additional numbers in anticipation of any needs, it's always useful to plan in advance.

Briar: Definitely, that's right. Thank you for that Al, that's very useful to know.

Ensuring key personnel on the licence are kept up to date and still with the business so that they have access to the licence

Another common pitfall is not keeping key personnel up to date on the sponsor licence and having no access to the licence when it is required, we see this quite a lot as well, don't we?

Al: Again, it’s something we see quite often. There are a number of positions on the on the sponsor licence which are held by people in the organisation: there's the Authorising Officer who's ultimately responsible for everything on the licence and all the other people who have access to the licence; and there's the Key Contact who, as the name suggests, is the person with whom the Home Office tend to liaise, and then there are Level 1 users who do a lot of the administration of the licence; Level 2 users, who similarly to Level 1, do administration but with less permissions essentially over the licence.

We tend to see clients come to us and say, well, our Authorising Officer’s left or the only Level 1 user we had has left, what do we do, we don't have access to the licence, we don't have somebody in place to assign Certificates of Sponsorship or sign submission sheets. In the circumstances there are workarounds. You can contact the Home Office to get access to a licence. The issue with that, is it gives the impression that as the sponsor there's been a dereliction of duties, you've neglected those obligations you have as a sponsor. Whilst I don't have anything concrete to support this point, for me it would be a flag on the system from the Home Office if they think you as a sponsor are not complying with its obligation.

Briar: Could definitely trigger a Home Office compliance visit.

Al: I think so, yes, or it puts you on the radar. So I would be suggesting again, it's just a case of not forgetting that the licence is there even if you're not using it all the time, just to make sure that the people who need access to licence are still there, there are sufficient people with access, and that if there are changes in senior staff, perhaps in the HR department where most of the key personnel tend to sit, before they leave, there are steps taken to ensure that if they do hold these positions in the licence so that they are replaced with appropriate people

Briar: Ideally before they leave the business.

Al: Definitely, because it just helps things run a bit smoother and I think also it helps avoid any temptation to share or use somebody else's Level 1 user details, which categorically should not be done as it is grounds for a licence to be revoked.

Briar: Very serious consequences for sharing Level 1 user details, isn't there? Thank you, Al. 

Ensuring that your licence continues to reflect the structure of the company

The next point on the list is sponsoring migrants to work for an entity which is not on the licence, this can get messy sometimes, can't it Al?

Al: Yeah, I think the issue is that we often see organisations change over time and then grow and develop with subsidiaries, sister companies and parent companies being formed and created as an organisation, changes from after having already obtained its sponsor licence. In terms of context, you can have various entities all under one sponsor licence providing they are linked by common ownership or control, that tends to be the most common or the typical connection we see connecting entities under a licence.

Whether it's advisable, having various entities under one licence will ultimately depend on that business’ structure and their processes. It's important that there is sufficient visibility between the entities, and that key personnel on the licence have oversight of what's being done under all the different entities, or as the Home Office calls them, ‘branches’, on the licence to ensure that it can meet its reporting and monitoring obligations.

So going back to your question, sponsoring migrants to work for an entity which is not on the licence, that is something we tend to see in larger corporate structures, we'll often get clients say we want to sponsor them to work for Company A, but Company B have the sponsor licence. Well, in theory, yes this could be fine. In this example, Company A and Company B share a parent company, they're both wholly owned by the parent company, that's fine. But the issue we tend to see is that the client doesn't know if Company A is a branch on Company B's licence, and we would often be recommending they go back to the original licence application to see if it's been disclosed as such. Unfortunately, many clients don't have that paperwork still, despite it being an obligation of them to have.

Briar: That's often the case.

Al: So we then are in a situation where we either have to approach the Home Office to get them to confirm or we make a request to add it as a branch to the licence in hope that it hasn't been done already, which again would suggest that if it has been done, we're doing it again, then the licence holder is perhaps not as on the ball as they should be.

So that's what you do if you are looking to employ somebody to work on a branch on a licence. It is important that before you look to sponsor somebody, that you are ensuring that it is a branch of licence, or the entity has its own sponsor licence.

Again, linked to this in a very similar situation we see is that we have migrants often being employed to regularly work from a new office site which perhaps hasn't been reported against the licence. The expectation is that if you are looking for somebody to work from a site, that that site has been accepted onto the licence first by the Home Office. So again, it's worth bearing in mind if as a larger organisation you do have various office addresses and locations that these are all recorded against the sponsor licence and it's something we can certainly assist with, but with larger organisations and corporate structures it can get quite complicated. It just shows how important it is to retain records.

Briar: Keep them up to date.

Al: Especially if you have high turnover of staff or perhaps a change of advisors, being able to show an audit trail of what has been reported and when, will serve you very well going forwards.

Briar: Thank you, Al. Another common pitfall linked to that area is failing to report big corporate changes in time. Can you elaborate on this Al?

Al: Again, what we often see is that immigration matters, and sponsor licence matters tend to be the last thing that is really thought about when you have changes in corporate structure, or perhaps if an organisation changes name, moves address, as part of a merger or acquisition that buys another company. It is so important that there are people in the organisation who are aware that corporate changes of this type can and do have an impact on the sponsor licence. The biggest example to give, or situation to be aware of, is a direct change of ownership.  Taking company A, in the example before, if company A were bought by company C outright, then company A’s sponsor licence, if they had one, is technically being revoked. So, there’s a lot to consider there if they do have sponsored migrants and they have a sponsor licence, you need to take that on board. The expectation is if in that situation Company C don't have their own sponsor licence and Company A still wants the ability to sponsor, then Company A need to be looking at getting a new licence.

So whilst I wouldn't expect people within an organisation to be fully aware of what needs doing and when, I think having an appreciation for the potential impact of certain changes and the certain corporate changes, an appreciation of what those could have or the impact they could have on the sponsor licence, will just ensure that a company is in good stead to deal with it proactively rather than reactively, and unfortunately we do tend to see a lot of clients having to deal with these matters really reactively, which just puts everything on the back foot and just makes it a little bit more stressful and, and time intensive than otherwise would need be if perhaps immigration wasn't the last thing people were thinking about.

Briar: Well, thank you, Al, we have covered a quite a few points today. To summarise the key points of the podcast are as follows:

1. Ensuring that you are assigning a COS correctly.

Al: It's always important to ensure that you're selecting and assigning the correct Certificate of Sponsorship based on the specific applicant’s circumstances.

Briar: Thank you.

2. Keeping an eye on your undefined COS levels.

Al: Definitely, always logging in, checking your needs and seeing what might change and try to anticipate the needs going forward of the of the company.

Briar: Thank you.

3. Ensuring key personnel on the licence are kept up to date and still with the business so that they have access to the licence.

Al: Yeah, very important one. You don't want to lose access, you don't want to find yourself in a situation where your key personnel have gone and you're having to take steps to get people into place and back into the roles which are fundamental to ensuring your compliance as a sponsor and your ability to be able to  continue to administer the licences as needs be.

Briar: Thank you Al. Lastly,

4. Ensuring that your licence continues to reflect the structure of the company.

Al: Try to ensure that immigration is part of the corporate structure conversation, and that it isn't a final thought. It just enables the company to act prospectively as opposed to reactively and ensure that it's well placed to undertake any reporting obligations which might come as a result of corporate structure changes; and in the case of a merger or an acquisition potentially requiring the company to apply for a new sponsor licence. But if you're ever in doubt, just take advice on the matter.

Briar: Well, thank you Al and thank you for listening to the podcast. Please do get in contact with the Doyle Clayton Immigration team if you'd like any assistance with your immigration needs.