Introduction
Holding a UK Sponsor Licence is a valuable privilege for employers dependent on international talent. However, the Home Office enforces strict compliance standards, and even minor breaches can lead to licence suspension, downgrade, or revocation.
Many sponsor licences are lost not due to deliberate misconduct but to inadequate systems, poor record-keeping, or a lack of understanding of sponsor responsibilities.
1. Understand Your Sponsor Licence Duties
The first step to compliance is understanding your legal responsibilities. Sponsor licence holders must comply with three core duties:
Record-Keeping Duties
You must retain up-to-date records for every sponsored worker, including:
- Passport and visa copies
- Right to Work check evidence
- Employment contracts
- Absence and attendance records
The Home Office expects these records to be readily accessible during an audit.
Official guidance can be found on the UK government website:
Home Office Sponsor Guidance
2. Keep the Sponsor Management System (SMS) Updated
The Sponsor Management System (SMS) is the Home Office’s primary compliance monitoring tool.
You must report certain changes within 10 working days, including:
- Changes to sponsored workers’ job roles, salaries, or work locations
- Early termination of employment
- Unauthorised absences exceeding 10 working days
Failure to update the SMS is one of the most common reasons sponsor licences are suspended
Related reading: SMS guide 2: manage your sponsorship licence (accessible) - GOV.UK
3. Conduct Regular Right to Work Checks
Right-to-work checks are mandatory for all employees, not just sponsored workers.
Best practice includes:
- Conducting checks before employment begins
- Using the correct Home Office checking method
- Retaining dated and signed evidence
Incorrect or missing Right to Work checks can lead to civil penalties and licence revocation.
Learn more here: Right to work check eligibility – Employer checking service – GOV.UK
4. Monitor Attendance and Absences Closely
Sponsors must have systems in place to monitor attendance and working patterns.
You must report:
- Unauthorised absences
- Failure to start work
- Significant changes to working hours
Home Office compliance officers expect active monitoring, not reactive reporting.
Tip: Automated attendance tracking systems significantly reduce compliance risk.
5. Prepare for a Home Office Compliance Visit
Home Office audits can be:
- Pre-announced
- Unannounced
During a visit, officers assess:
- Automated systems and processes
- Staff knowledge of sponsor duties
- Accuracy of records
- Genuineness of roles
6. Train Key Personnel and Level 1 Users
The Home Office expects sponsors to ensure that:
- Authorising Officers
- Key Contacts
- Level 1 Users
are properly trained and understand compliance obligations.
Staff turnover without updating roles on the SMS is a major compliance red flag.
Conclusion
Losing a sponsor licence can have serious financial and operational consequences, including the loss of sponsored staff and reputational damage.
By:
- Understanding sponsor duties
- Keeping accurate records
- Updating the SMS promptly
- Training staff
- Preparing for audits
Sponsor licence holders can significantly reduce compliance risk and maintain their licence with confidence.
If you need tailored advice or a compliance health check, professional support can make all the difference.
