Recent case law in England and Wales has underscored the significant consequences for employers who fail to comply with their sponsor licence duties when hiring migrants under the Skilled Worker Visa route.
In March 2026, an Employment Tribunal in Birmingham found that a care worker from India who was lawfully sponsored by their employer under the Skilled Worker visa route had not been provided with a day of work for over a year from their formal start date. The care worker received a compensatory award of over £20,000.00 covering unpaid wages, holiday pay, their employer’s failure to provide a statement of terms of employment and follow ACAS discipline and grievance procedures.
This reflects the trend of the stricter regulatory framework governing sponsor licences which continues to dominate. Updated guidance issued by the Home Office in March 2026 introduced new duties on sponsors, including the obligation to provide sponsored workers with written information on their employment rights and retain records confirming this information was provided to the relevant sponsored workers.
Significantly, in March 2026 the Home Office modified the test for initiating enforcement action, entitling it to intervene and conduct compliance checks where it is satisfied there is “reasonable suspicion” that a breach of sponsor duties has occurred. This lower threshold marks a clear shift away from the previously evidence based approach taken to investigating compliance and increases the risk of investigations into sponsor licence suspension at the very least, leaving sponsors with a slim margin for error.
Further, since April 2026, the Home Office has been able to access payroll data from HMRC for all sponsor licence holders as another tool to monitor compliance and justify enforcement during investigations. This enables the Home Office to check a sponsored worker’s actual pay against the working hours and gross annual salary disclosed in their assigned Certificate of Sponsorship and ensure it meets the salary threshold for sponsorship in the worker’s job occupation code. This new avenue poses a real risk to sponsors and is a further indicator of the
2025 witnessed a record-breaking 3,100 sponsor licence revocations following findings of illegal working arrangements, the highest amount since the introduction of the UK sponsorship system, while compliance visits from the Home Office increased by around 51%.
Revoking a sponsor licence is the most serious penalty that the Home Office is entitled to impose on a sponsor. From the employer’s perspective, they will be removed from the official Register of Licenced Sponsors which effectively “names and shames” the employer. The employer will lose all sponsorship rights, meaning it is prohibited from sponsoring new workers.
From a worker’s perspective, their visa will be curtailed and they will have 60 days or until their leave expires (if sooner) to switch their immigration permission or leave the UK.
Revocation or any finding of breaching a sponsor licence duty can bring reputational damage, financial implications, business disruption and criminal sanctions. Even where a sponsor’s licence is only suspended, the process for reinstatement can be lengthy and cause disruptions to recruitment of migrant workers.
Sponsor Licence obligations are not a box ticking exercise, they are substantive legal commitments and compliance is central in this higher risk landscape for sponsors. All sponsors should act now in reviewing their approach to compliance and if necessary, take further steps to mitigate against the possibility of Home Office enforcement. Recommended best practices for Human Resources teams within sponsor licence holding organisations to incorporate can be found in our previous article here.
This article was written by, Trainee Solicitor Laura Gooding and Associate Director Nathan Campbell.
This article has been produced for general information purposes and further advice should be sought from a professional advisor. Our Business Immigration team at Cleaver Fulton Rankin can provide you with the specialist advice you need.
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