Applying for a Tier 2 Sponsor Licence – The Ultimate Guide

Employers will be delighted to hear that the labour-intensive resident labour market test is being abolished from 1 January 2021!

The importance of writing an accurate and compliant job description

Before we deal with the technicalities of the resident labour market test, it is important to ensure your job description is well thought through and that the job description/duties are broadly in line with the description in the relevant SOC code.

Appendix J sets out ‘Example job tasks’ next to each SOC code.  The role you are looking to fill should broadly accord with the Example Job tasks.  If most of the duties in your job description fall into another SOC code, then you are using the wrong code. Furthermore, this is likely to be picked up by the Home Office in any audit and could lead to enforcement action.

However, it could also look suspicious if your job description mirrored the Example job tasks in Appendix J. This issue of essentially ‘cut and pasting’ from the SOC code into a job description was one of the reasons why the Home Office refused a migrant’s Tier 2 visa application, in a case which reached the Court of Appeal in 2017.

Employers therefore must often walk a fine line, between ensuring a job description is sufficiently in-line with the appropriate SOC code, whilst ensuring the job description does not seem contrived.

You should also bear in mind that if you are inspected, then you and your sponsored migrant will be expected to be undertaking work which accords with the job description in the original job advert.

When it comes to recruitment selection, you should bear in mind that you can only reject a settled candidate if they do not meet essential criteria. You should not reject a settled worker because they do not possess ‘desirable’ skills or experience.

If, ultimately, there is a certain individual you have in mind to sponsor, then careful formulation of the job advert is essential.

How do you carry out a resident labour market test?

The point of the resident labour market test is to show that you are not giving a job to a non-settled worker, where a settled person could do the role.

The resident labour market test must be carried out in a highly prescriptive manner.  You must include specific information in the advert, you must advertise for at least calendar 28 days, you must advertise in certain mediums, and you must record the advert in a certain manner.

You really do need to check the relevant section of the guidance to see exactly what you need to do (see paragraph 28.17).  You should also refer to the relevant sections of Appendix D which will tell you the precise documents you need to retain, as there are many variables which would be too great to cover here. What follows is a summary of the key points.

You need to advertise for at least 28 calendar days.  You must usually advertise in at least 2 mediums set out in the guidance.  One of these most ordinarily be through the Government website Find a Job, although certain roles are exempt from having to advertise there.

There are various options for the second medium, although usually our clients will advertise through a well-known job-search engine, such as Indeed.  The second method can include your own website, but only if you are a multi-national/global operation, or have over 250 employees in the UK.

You will need to take screenshots of the job advert when it goes live.  Appendix D will tell you exactly what information needs to be contained in the advert.

It is important to carry out a compliant resident labour market test.  As well as having to provide evidence when you apply for a sponsor licence, evidence of the test will almost certainly be requested if/when you are inspected.

Do I need to advertise even if I do not need to run the resident labour market test?

You must if you are not exempt.  However, when you sponsor someone you must always satisfy the Home Office there is a ‘genuine vacancy’.

We have seen refusal letters/enforcement action taken on the basis that an employer has not shown there is no suitable settled worker who can do the job, even where there is a resident labour market test exemption.

Paragraph 24.6 of the sponsor guidance states:

Tier 2 allows UK employers to employ nationals from outside the settled workforce to fill skilled jobs which cannot be filled by settled workers. A migrant sponsored under any Tier 2 category must not displace a suitable settled worker, which means that you can only offer a job to a migrant you wish to sponsor under Tier 2 if there is no suitable settled worker available to fill the vacancy.

Our safety-first approach is that, if you are exempt from the test and have genuinely been having difficulties recruiting for a position, that you provide some evidence, including at least an explanation, of your efforts to recruit through the settled workforce.

It is also important to note, that when you apply for a licence, if you are applying for a certificate of sponsorship for a particular individual, you must provide evidence of how you identified this person, or if you did not advertise for the job, you must show how you identified this person is most suitable for the job.  This information is requirement in respect of all individuals, not just those for whom a formal resident labour market test applies.

We are not suggesting that you undertake a full resident labour market test even if an exemption applies.  But we are saying that, if you can provide some evidence or information to explain why you could not recruit through the settled workforce, even if this falls significantly short of any formal labour market test, then you are less likely to have a problem.

This cautious approach is probably not necessary if a job is on the Shortage Occupation List.

Part E: Timing is everything!

Making sense of the various timescales

Before you go ahead and apply for your licence, you need to be aware of some important and strict deadlines and timescales which apply. Being on top of these time scales is particularly important if, for example, you have a narrow window to recruit someone.

You should bear in mind that:

1. The resident labour market test (if it applies) will take a minimum of 28 days. But then you must factor in the rest of selection process – e.g. shortlisting and interviews
2. Once you submit the sponsor licence application, the Home Office says it will decide applications within eight weeks. In practice, applications are being decided in about five weeks.
3. If you are applying for a licence and will need a restricted certificate of sponsorship, you must apply for and then be granted a licence before you apply for a restricted certificate of sponsorship.
4. If you are applying for a restricted certificate of sponsorship, then there is a ‘monthly cycle’. Any request made by the 5^th day of each month is considered on the 11^th day of the month and you should be allocated a restricted certificate of sponsorship on or not long after the 11^th day of the month.
5. You must assign the certificate of sponsorship within six months of first advertising the job under the Resident Labour Market Test. Any longer than this and the resident labour market test is not valid.
6. The prospective employee must submit his or her Visa Application within three months of the certificate being assigned.
7. The prospective employee can submit his or her visa application up to three months in advance of the start date with the new employer.
8. If the person is applying for his or her Tier 2 visa from abroad, then there is a wait of up to three weeks for a decision, from the date you attend the visa application centre. However, if you pay an additional fee for the Priority Service, then you get a decision within five working days.
9. If the person is applying from within the UK, then the decision can take up to eight weeks, from the date of the biometrics appointment. However, you can pay an additional fee for the Priority Service and get a decision within five working days. You can alternatively pay for the Super Priority Service, which buys you a decision by the end of the next working day.

Before you apply for a licence, you should set a clear ‘road map’ towards the person commencing employment with you, allowing for the various factors above.

Part F: Applying for the sponsor licence

Risk of applying without someone identified

Before we consider the application process itself, we want to highlight the risks of applying for a licence without having identified an individual (if you have identified someone and are making this clear in the application, then skip this section).

Whilst there is nothing to stop you applying for a licence without having identified someone, we have seen several such applications turned down. One of the mandatory grounds of refusal of a sponsor licence application is as follows:

‘If you are applying under Tier 2 and we are not satisfied that you can offer genuine employment that cannot be filled by a resident worker, and/or that meets the Tier 2 requirements.’

If you are operating in a sector which depends on jobs which are on the Shortage Occupation List, then this should be made clear in your sponsor licence covering letter, and it should then be less of an issue if you have not identified someone.

If, however, you do in fact have someone that you would like to sponsor, then it is best to be upfront about this in the licence application. Even if a position is exempt from the resident labour market test, then you are still required to provide evidence of how you identified this person.

Provide documents listed in Appendix A

Before you submit your application online, ensure that you have all required supporting documents. These are listed in Appendix A.  Appendix A is not user-friendly. You need to work through a series of ‘tables’ to work out which documents you need – until you have amassed a total of at least four.

Do make sure you work through these tables in sequence, 1-4, although in my experience, an employer normally ends up getting all four documents from Table 4.  There is a requirement that documents be originals or certified copies. There is considerable detail in the main sponsor guidance about how documents should be certified. As ever, these requirements by the Home Office fail to take account of the real world, where documents tend to be auto-generated through HMRC, or by companies, and so the document has never been an ‘original’, in the way the Home Office mean.

Bear in mind, the guidance also tells you to include a hierarchy chart ‘detailing any owner, director and board members. If your business has 50 employees or fewer, you must list all employees and set out the names and titles of all staff.’

As well as documents, requested information in Appendix A is mandatory

Be sure to include a detailed cover letter with your application which covers the mandatory information required from you, as stated in pages 6-7 of Appendix A. We have seen applications rejected due to employers failing to provide this information.

At Truth Legal we have a 100% success rate in sponsor licence applications, with zero rejections or refusals.  We put this down to our assiduous case preparation, and our covering letter which we will write on behalf of our clients. This cover letter is the culmination of our dedicated work with our clients, ensuring we take careful instructions to tailor the letter to our client and all Home Office requirements (note the cover letter must be sent by the employer and, if you instruct us, you must always ensure you are entirely happy with the contents of the letter and review and amend it as necessary).

Submit the application online (and then post it!)

In typical Home Office fashion, the ‘online’ form requires you to then print off something called the Submissions Sheet, which you post along with your covering letter and supporting documents.

Part G: Help! My sponsor licence application has been rejected or refused

If you have already applied for your licence, but received a negative decision, it is essential to fully read and understand the basis of the negative decision. If you failed to provide certain mandatory information, then your application might have been ‘rejected’.  Annoyingly, the Home Office does not necessarily tell you exactly what was wrong with the application, but instead will simply ‘cut and paste’ sections from the sponsor guidance documents, which merely alludes to what might be the problem.

Alternatively, you might have been ‘refused’, for any number of reasons.  Common reasons for refusal include not paying the salary the minimum salary threshold, or if the Home Office believe the vacancy is not genuine.

Either way, if you want to reapply, you will need to check whether there is a ‘cooling-off’ period which prevents you from reapplying for a certain period.  You will certainly need to address any reasons for rejection/refusal in any subsequent application.

At Truth Legal Solicitors, we have a 100% record in helping employers to apply for a sponsor licence, in circumstances where, prior to instructing us, they had either been rejected or refused.

Explainer: Rejection vs Refusal

The difference between a ‘refusal’ or ‘rejection’ of a sponsor licence application is important – a ‘rejection’ is the lesser of two evils, as you can apply again straight away, whereas a ‘refusal’ means that normally a ‘cooling-off period’ applies, whereby you must wait at least six months before reapplying.

How we can help

At Truth Legal we will provide you with an initial free, no-obligation, consultation to check if you are likely to be eligible for a licence.

If you then instruct us, we will guide you through the entire application process.  This includes:

• A detailed conference (to establish the sponsoring routes for individuals, salary, whether a resident labour market test applies, key personnel, sponsor duties, compliance)
• Help devising a compliant job advert/resident labour market test (where applicable)
• Reviewing all supporting documents
• Drafting a detailed covering letter
• Being on the telephone whilst you submit your sponsor licence application
• Assisting you with applying for a certificate of sponsorship (whether as part of the licence application or separately)
• Helping you to assign the certificate of sponsorship to the migrant
• Basic visa advice for the migrant

If you would like to discuss your sponsor licence application, and for a free 30-minute consultation, contact us today.

Part H: Sponsor licence compliance

What is compliance?

When you apply for a licence, you agree to fulfill certain duties which relate to your sponsor licence. The sponsorship system is built on the understanding that (in the words of the Home Office)

‘Those who benefit most directly from migration (that is the employers, education providers or other bodies who are bringing migrants to the UK) must play their part in making sure the system is not abused.

The Home Office needs to be sure those applying to come to the UK to do a job or study are eligible to do so, and a reputable employer or education provider genuinely wishes to employ or enrol them.’

Through the sponsorship system, the Home Office has effectively outsourced much of the monitoring of migrant employees to the employer. The Home Office therefore expects you to take your sponsor duties seriously. These duties are commonly referred to as sponsor licence compliance.

Here is a brief outline of your sponsor duties and responsibilities.

Job suitability

You must only assign a certificate of sponsorship to a migrant where there is a suitable job. This goes to issues around minimum rates of pay and skill level (see above, Part A: Which jobs can be sponsored under Tier 2).

Monitoring sponsored employees

Before you can properly monitor your sponsored employee, you will need to understand what your reporting duties are.  Again, these are set out in some detail in the main sponsor guidance, Tiers 2 and 5: guidance for employers.  To choose just a couple of many duties, you must report within 10 working days, if a sponsored migrant does not turn up for their first day of work, giving any reason for their non-attendance.

If a sponsored employee is absent from work for more than 10 consecutive working days without permission, you must report this within 10 working days of the 10^th day of absence.

Reporting changes to the business

There are also strict requirements, and deadlines, to report certain changes to your business.  One example, which catches many out and which if unreported can lead to enforcement action, is the requirement for you to change your address or change Key Personnel.

Record keeping duties

Appendix D set out the documents you are required to retain in order to be compliant.  It is beyond the scope of this legal guide to go through all the required records, and so you really must carefully read the Home Office guidance or request our assistance to guide you through this.

However, in brief you must retain copies of documents personal to each sponsored employee. For example, this includes their passport, biometric residence permit, NI number, contact details and record of absences.

Where a resident labour market test is required, there are highly prescribed documents to retain, including screenshots of the job advert, where advertised online.

On an on-going basis, you must retain evidence relating to the employee’s pay, as well as the contract of employment. You must keep a copy of the job advert and, where a requirement of the job specification, any relevant qualifications.

What are the sanctions for non-compliance?

Refusing your sponsor licence application

If the Home Office discerns that you cannot comply with your duties at the sponsor licence application stage, then it will refuse your sponsor licence application. You will be subject to a ‘cooling-off’ period during which you may not make a further application.  The cooling-off period will be at least six months.

Sponsor licence suspension

If your licence has already been granted, and you are found in breach of your sponsor licence duties, then you could receive notification that your licence is due to be suspended.  During the period of suspension your existing sponsored employees can continue to work for you.  You will, however, be prevented from assigning a certificate of sponsorship to a new employee.

Once suspended then the Home Office will consider whether to reinstate, downgrade or revoke your licence.  You will be given 20 days to make representations, to argue why your licence should be reinstated.  You will need to provide considered evidence to rebut any reasons for suspension.

Sponsor licence revocation

The effect of sponsor licence revocation is usually devastating, both for the employer and any affected employee. If your licence has been revoked, then any sponsored migrant working for you will have their visa curtailed.

If your licence has been revoked then there is usually a ‘cooling-off’ period of 12 months, or potentially longer, before you can apply for a fresh licence.

There is no right to appeal against a decision to revoke your licence.  A revocation decision can, however, be challenged by judicial review and this is something that we can help you with. However, we would always try to use ‘soft tactics’ first with the Home Office, to try and get your licence reinstated.

Preparing for an inspection

You are likely to be inspected at some point during the currency of your licence. You might be inspected either before being issued with a licence, or after you have been granted a licence.

Our advice is to prepare for a licence inspection prior to being granted a licence. This means ensuring that you have appropriate HR systems in place to comply with your sponsor licence duties from when you submit your application. We can help you to have compliant systems, see the section below, How we can help you to become compliant.

Whilst as a proportion, more businesses are inspected after they receive their licence, many businesses are inspected pre-grant.  It is therefore prudent to be prepared from the outset.  Furthermore, once you have proper systems in place from the outset, then you avoid having to do the work further down the line, often in ‘fire-fighting mode’, when you receive a notice you are about to be visited.

The inspection will normally involve a Home Office case worker holding in-depth interviews with the Authorising Officer and other Key Personnel, as well as any sponsored migrants.

Expect the Home Office to meticulously check how you are complying with your duties.  Particular areas of focus are likely to be: how you are able to comply with your monitoring and record-keeping duties; how you conducted the resident labour market test; whether the sponsored vacancy is genuine; and how you are meeting your Right to Work obligations.

How we can help you to become compliant

The Immigration Team at Truth Legal are experts at sponsor licence compliance.  We can help you to keep on top of your sponsor licence duties and help you to stay on the right side of the Home Office.

If matters are at a more advanced stage, and if the Home Office is already taking an interest in your company, or have already taken sanctions against you, then we can help.

We can help you in various ways:

Providing HR compliant policies

The best way to avoid enforcement action is to ensure you have compliant HR policies and systems in place at the outset.  Whether you are applying for a licence, or already have a licence, we can provide cost-effective, tailored Compliance Packages to ensure you stay on the right side of the Home Office.

Conducting a ‘mock-audit’ of your systems and provide you with an action-plan.

We can test your existing systems to see if they are compliant.  We provide an Action-Plan to advise you on areas to improve.  We can either conduct the assessment on-site or remotely. This increases the likelihood of you being compliant on an on-going basis, prepared for when any inspection comes.

Making representations on your behalf and advising on the best evidence to challenge enforcement action

If you have received notification of enforcement action, and have been invited to make representations, then we can assist you with this.  We understand what the Home Office want to see.  We can advise you on documents to provide, changes to make within your organisation, and can write a letter of representations on your behalf.

Advising you on best next steps if your licence has been revoked, including potential judicial review challenge.

If your licence has been revoked, we can review your case and advise you on the best course of action.  It might be the case that carefully prepared representations, showing suitable contrition with a suitable action plan, can be enough to have your licence reinstated.

In certain cases, judicial review might be the best course of action, in which case we will represent you in all aspects of the challenge.

Truth Legal – Expert Immigration Solicitors

Louis MacWilliam who heads up our Immigration Team. With over 11 years’ experience as a dedicated immigration specialist, Louis is one of the few genuine immigration experts in this area.

If you want to apply for a sponsor licence, or have any other issue relating to your sponsor licence, contact us for a free consultation today.

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