In an important change to the way the Sponsor Licence system will operate, the Home Office announced that it is updating the licence renewal process.

Posting notices in the Sponsor Management System (SMS), rather than by way of a more widespread communication, the Home Office have declared that, from 6 April 2024, when a Sponsor Licence is due for renewal there will be no need to apply for renewal and pay the required fee of either £536 (for small or charitable organisations) or £1,476 (for medium or large organisations). Rather, Sponsor Licences expiring on or after 6 April 2024, will be automatically renewed for 10 years.

What does this mean for existing Sponsor Licence holders?

It’s good news for all Sponsors whose licences expire any time after 5 April 2024! It’s less good news for any Sponsor where the licence is due for renewal between 25 January 2024 and 6 April 2024, as well as those who have already submitted a renewal application from the beginning of the year although this will be the last time a renewal request will need to be submitted.

The Home Office have also confirmed that where a Licence was due for renewal after 6 April 2024 and an application has already been submitted, a refund of the renewal fee will be made. However, if a Licence is due for renewal between 25 January and 6 April then no renewal refund will be made. This introduction of automatic Licence renewal is a further step in the Home Office’s move to deliver its services completely digitally. It heralds a further streamlining of the approach the Home Office is taking towards all manner of UK immigration processes and applications.

• Sponsor Licence holders and prospective Sponsors of overseas workers should note that the Home Office will still undertake the usual checks when Licences are due for renewal, including reviewing the Licence status, Certificates of Sponsorship assigned, whether compliance obligations have been met, record-keeping reflects the immigration status of sponsored workers and will also consult other government departments such as HMRC.

Whilst we welcome this change, it unfairly impacts Sponsors where the Licence expires between now and 6 April, or where it had to be renewed prior to the date of the announcement (24 January 2024). Bindmans is making representations to the Home Office for a review of the position on both automatic renewal for Licences expiring between 25 January and 6 April and will urge for refunds of all Licence renewal fees for those made before 6 April 2024. The chosen date for automatic renewal appears arbitrary but ties in with the tax year for the UK.

Ongoing Sponsor Duties and Responsibilities

All UK based employers should ensure that they meet all obligations under all relevant UK laws for the legal employment of staff in the UK, including meeting responsibilities on Right to Work Checks (1) on all staff regardless of nationality. Sponsors should take particular care to also adhere to their Sponsor duties and responsibilities (2) and must carry out regular check-ins to their SMS/Licence.

If you have any questions as to how this may impact you or your business please contact Tanya Goldfarb, Head of Bindmans Business Immigration Team.

Bindmans is not responsible for the information at the gov.uk links, which is subject to change at any moment or for ensuring that the relevant links are operational.

Please note that this comment is provided for informational purposes only and must not be relied on as legal advice.