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It used to be so straightforward – sponsor licence application refusals dramatically increase

5 December 2024

When someone sets out a process and gives you instructions, you kind of expect when you follow the instructions to achieve the desired outcome, like assembling some flatpack furniture.


Unfortunately now when it comes to dealing with UK Visas & Immigration (UKVI), even diligently following instructions as set out in published guidance, is no longer enough. Which is creating uncertainty and frustration for organisations wishing to obtain sponsor licences and hire foreign nationals.

Nearly 40% of recent sponsor licence applications were unsuccessful


The government has published data which shows that between July to September 2024 UKVI received 8,299 sponsor licence applications of which 5,054 licenses were granted, and 3,245 applications were not granted (i.e. the applications were withdrawn, rejected or refused). Therefore, terrifyingly just over 39% of sponsor licence applications were unsuccessful in the quarter to September 2024.

For the previous quarter up to June 2024, around 30% of all sponsor licence applications were unsuccessful. The recent uptick is even clearer to see given that for the 18 months or so prior to that the rate of refusal was consistently around 22%.

The graph below highlights the increase in unsuccessful sponsor licence applications:




 

Why (and how) the jump in sponsor licence application refusals?


The jump in the number of unsuccessful sponsor licence applications is almost certainly not down to a decline in the quality of applications, but rather to a dramatic change in UKVI’s approach. For businesses this is especially concerning given there has not been a noticeable change in UKVI’s published guidance.

A broad interpretation of their own guidance, together with the lack of effective legal recourse to challenge UKVI’s sponsor licence decisions, provides caseworkers with a fiefdom of their own in which they can strike down sponsor licence applications for tenuous or even legally erroneous reasons. It seems that the government’s objective of pushing businesses to rely less on immigration is currently being implemented not through changes to the law or guidance but in a more nebulous way, by frustrating immigration applications. 

Organisations that receive sponsor licence refusals are also subject to a 6-month cooling-off period that leaves them sitting on their hands waiting for this to end before they can apply again. It’s a pretty high-stakes game.

Existing sponsor licence holders beware
 

As shown in the graph, the change in UKVI activity is not just in relation to refusing more sponsor licence applications. Existing sponsor licence holders need to beware of a rise in compliance activity being carried out by UKVI.

The graph shows the number of sponsor licence revocations going on an upwards spike in the last 12 months. Even allowing for higher number of sponsor licences this is a massive increase.

A recent Home Office press release highlighted the extra compliance activity – with a 22% increase on the number of compliance visits from January to October 2024 as compared to the same period the year before.

Further strict new rules are in the pipeline with an intention to double cooling-off periods where a sponsor licence is revoked – from 12 months to 2 years.  Plus, there’s a plan to increase the length of time a sponsor can be on an action plan (where a breach of sponsor duties has been found) – from 3 to 12 months (with restrictions on what you can do as a sponsor during that time).

Avoiding the pitfalls
 

The government’s direction of travel is clear - businesses that might wish to sponsor individuals must expertly deal with sponsor licence applications to reduce the risk of getting caught out. Even then, simply following UKVI’s lengthy guidance to obtain a sponsor licence is no longer enough. Once a business has a sponsor licence it needs to be very careful to remain compliant.

further information

If you have any queries in relation to sponsor licence applications and/or sponsor licence compliance, please contact a member of the immigration team.

 

about the author

Robert has extensive experience of assisting individuals and organisations with their UK immigration and nationality matters. Robert’s experience covers all kinds of immigration and nationality applications but with a particular emphasis on corporate immigration matters and complex immigration issues faced by individuals, such as previous immigration breaches and criminality.

 

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