The Importance of Sponsor Licence Compliance with New Home Office Access to Payroll Data
Sponsor Licence compliance is becoming increasingly important for UK employers, particularly as the Home Office continues to strengthen its monitoring of sponsored workers.
With the Home Office now having access to HMRC payroll data for companies holding a Sponsor Licence, they can identify any discrepancies between the salary reported for a sponsored migrant worker and the salary actually paid and hence if any salary deficits are identified, these may lead to serious consequences, resulting into potential suspension, revocation or compliance audits.
The Risk of Home Office Enforcement
There have been reported instances where Licences were revoked following identified breaches with limited opportunity for employers to respond. However, it was indicated at the conference that, going forward, the Home Office may increasingly seek clarification from employers before taking enforcement action. Despite this, the risks for businesses remain significant, particularly considering the recent increase in compliance audits and Sponsor Licence revocations.
Why SMS Monitoring Is Essential
Therefore, best practice for Sponsor Licence holders is for key personnel to regularly access and monitor the Sponsorship Management System (SMS). Any changes to a sponsored worker’s circumstances such as salary adjustments, changes in working hours, or periods of unpaid leave (including maternity/paternity), or other material changes are reported promptly and accurately to the Home Office with clear and accurate explanations.
The Consequences of Non-Compliance
The Home Office expects the Sponsors to carry out their sponsorship duties diligently and failure to meet these duties can have serious consequences for the businesses, including penalties, downgrade rating, licence suspension or even revocation. As mentioned in the guiding principles under sponsorship duties: “Sponsorship is a privilege and not a right. Sponsors benefit directly from migration and are expected to play a part in ensuring that the system is not abused. Sponsors must therefore fulfil certain duties, in order to ensure that immigration control is maintained.” Regular internal checks, accurate record keeping and timely reporting are therefore essential to demonstrating compliance and avoiding issues escalating unnecessarily.
How Ellisons Can Support Employers
At Ellisons, our team of specialist immigration as well as employment Solicitors can assist employers with reviewing and assessing whether they are compliant with the Home Office requirements. We help businesses reduce the risk of compliance audit visits and safeguard their Sponsor Licence.
