Sponsorship Management System tips for HR

The Sponsorship Management System provides an online platform through which licensed employers can meet many of the requirements under the UK’s Immigration Rules when sponsoring migrant workers. The following guide for HR personnel, or those otherwise responsible for using this system, examines how the system works and what role it plays in the context of sponsor licence compliance, including the penalties for failing to comply.

What is the Sponsorship Management System?

Having been granted a licence to sponsor migrant workers, certain key personnel within the sponsoring organisation will be given access to the Sponsorship Management System (SMS). This is the gateway between the sponsoring organisation and UK Visas and Immigration (UKVI), the division of the Home Office responsible for the immigration system in the UK.

The SMS is the UKVI portal that allows authorised users to manage the sponsor licence and migrant workforce, together with any related sponsor activities, such as assigning Certificates of Sponsorship (CoS). The SMS also allows authorised users to discharge a number of the employers’ duties when sponsoring Worker and Temporary Worker visa holders.

The role of the SMS in sponsor licence compliance

The grant of a sponsor licence will allow employers to recruit workers from outside the UK who don’t otherwise have immigration permission to undertake work or the work in question — provided these prospective employees meet the requirements for a sponsored visa.

However, having been granted Home Office approval, significant trust is placed in the licence holder to comply with the requirements for sponsorship and prevent abuse of the system. This means that a licensed sponsor has a number of duties to ensure compliance under the rules.

These duties include reporting through the SMS any changes to the circumstances of a migrant worker, or reporting any changes in the organisations’ own circumstances, all within prescribed timescales. Changes to a migrants’ circumstances could include, for example, any information which suggests that a sponsored worker is breaching the conditions of their leave, such as regular absences from work or resignation. Changes of circumstances to the sponsoring organisation could include a change of name or location, or changes to the details of the key personnel responsible for managing the sponsor licence under the SMS.

Who is responsible for using the Sponsorship Management System?

When applying for a sponsor licence, the employer is required to nominate various key personnel as part of their application, some or all of whom will have access to the Sponsorship Management System once a licence has been granted. These individuals will be responsible for ensuring that the employer’s duties under the sponsor licence are met.

There are 4 key personnel roles:

Authorising Officer

This is the person responsible for the recruitment of migrant workers within the sponsoring organisation. The Authorising Officer must be a senior and competent person within the business, as they’ll be responsible for the system activities of all SMS users, and in ensuring that the employer’s sponsorship duties are met.

Key Contact

This is the person who acts as the main point of contact with UKVI;

Level 1 User

This is the person who will carry out the day-to-day sponsorship activities using the Sponsor Management System, from assigning CoS and, where required, reporting migrant worker activities, to updating the SMS and renewing the sponsor licence;

Level 2 User

These are optional SMS users, appointed by the Level 1 user once the licence has been granted, but with more restricted permissions.

The key personnel roles can be filled by either the same person or different people, but as only Level 1 and Level 2 users will have access to the Sponsorship Management System, the Authorising Officer or Key Contact must be set up as system users if they require access.

There can only be one Authorising Officer and one Key Contact, although the system can be used to request additional Level 1 users, and to add Level 2 users. The number of SMS users appointed will depend on the structure of the organisation and its’ business needs.

How should HR use the Sponsorship Management System?

The Sponsorship Management System has a number of key functions to help HR personnel, and any other SMS users, to effectively manage the sponsor licence and migrant workforce, and to discharge the employers’ duty to monitor and report certain changes.

Some of the main SMS functions include:

• Managing key personnel – a Level 1 user can access all SMS functions, including requesting additional Level 1 users, or adding and removing Level 2 users, as well as replacing the Authorising Officer and Key Contact or changing the details of existing personnel;
• Creating and assigning CoS – both Level 1 and Level 2 users can assign CoS, each certificate with a unique reference number to enable migrant workers to apply for a sponsored visa;
• Renewing CoS allocations and applying for additional CoS – a Level 1 user can request an increase on the number of CoS a licensed sponsor can assign annually;
• Reporting any changes in circumstances of sponsored migrants and the sponsoring organisation – both Level 1 and Level 2 users can report migrant activity using the SMS, although a Level 2 user can only do so on CoS that they’ve created and assigned;
• Managing or renewing the organisation’s licence – the Level 1 user will be responsible for renewing the sponsor licence, valid for 4 years unless revoked, and tracking the progress of any such application to ensure that sponsorship can lawfully continue;
• Paying for and tracking the progress of any sponsor action plan – the Level 1 user will need to monitor the progress of any action plan imposed by UKVI, to restore the licence rating where this has been downgraded from “A” to “B” for non-compliance with the rules;
• Viewing the UKVI message board – only a Level 1 user will be able to access key messages posted by UKVI. The SMS will also notify the Level 1 user of important events during the lifespan of the licence including, for example, when this is due to expire.

Step-by-step guides on using the SMS, with its’ different functionalities, can be found at GOV.UK in the various SMS manuals issued by the Home Office.

Penalties for non-compliance with sponsor licence duties

If an employer fails to comply with their sponsor licence duties, there are various different measures that can be taken by the Home Office, depending on the nature and seriousness of any breach. The Home Office enforcement process for non-compliance can include:

• downgrading the sponsor licence rating
• suspension or revocation of the sponsor licence
• referral for a civil penalty, or even criminal prosecution

Downgrading the sponsor licence rating

Where UKVI has reason to believe that the licence holder is failing to meet their duties as a sponsor, usually following an on-site compliance visit, this could result in the licence being downgraded from an “A” to a “B” rating. This will also involve a time-limited sponsor action plan at a cost of £1,476 to the employer. This is designed to address fairly minor breaches of duty, typically in circumstances where the licence holder is willing and able to correct any non-compliance and doesn’t pose a threat to immigration control.

The sponsor action plan will set out the steps that need to be taken to help reinstate “A” licence rating. At the end of the plan, if the sponsoring employer has satisfactorily completed all the steps, their A-rating will be restored. If improvements are still needed, the employer may either be given another B-rating, and required to follow a new action plan, again at their expense, or they could lose their licence altogether. A sponsoring employer can also only be B-rated twice during the validity period of their 4-year licence.

If the licence rating is downgraded, the employer will still be able to issue CoS to workers that they already employ who want to extend their permission to stay in the UK. They’ll not, however, be able to issue new certificates until they’ve made the necessary improvements and upgraded. This means that any overseas recruitment will be temporarily put on hold.

Suspension or revocation of the sponsor licence

Where the sponsoring employer has failed to comply with any sponsor action plan(s), or there’s been either a significant or systematic failing, and the licence holder is deemed to pose a serious threat to immigration control, their sponsor licence may be suspended or revoked.

A decision to suspend could be where UKVI needs to investigate the possibility of non-compliance before making any final decision. However, where a breach is especially serious, UKVI has the power to revoke a sponsor licence without prior suspension.

A licence holder will be at risk of suspension or revocation if they’re suspected or found to be employing illegal workers, unless they’ve carried out prescribed right to work checks. More minor breaches of the rules can also lead to revocation, especially where the employer has failed to address any areas of concern set out within a sponsor action plan.

Civil penalty or criminal prosecution

Where a sponsoring employer has been found to be employing anyone who is prohibited from lawfully working in the UK by reason of immigration control, and the employer has failed to establish a statutory excuse against illegal working by conducting a right to work check, they could be facing a civil penalty of up to £20,000 per worker.

If the employer is found guilty of employing a migrant who they knew, or even had reasonable cause to believe, didn’t have the right to work in the UK, they could also be criminally prosecuted, resulting in a custodial sentence of up to 5 years and/or an unlimited fine.

Sponsor licence compliance best practice

As the consequences of non-compliance can have serious consequences for a business, securing expert legal advice from an immigration specialist can be a good investment. This can help employers to avoid the imposition of a costly and time-consuming sponsor action plan, or any other possible sanctions, and avoid any disruption to their migrant workforce.

There are also various best practice tips that can help sponsoring employers to remain licence compliant when using the SMS. These include:

• Keeping the number of SMS users to an absolute minimum: as the Authorising Officer is responsible for the actions of all system users, the number of users should be limited to the minimum needed for the effective management of the sponsor licence;
• Ensuring the Authorising Officer is also an SMS user: the Authorising Officer must have access to the SMS to be able to regularly review the licence details, keep up-to-date with the latest news and messages, and ensure that other users are abreast of any actions needed;
• Exercising caution when appointing key personnel: as the sponsoring employer will retain overall responsibility for compliance with the rules, if any key personnel fail in their duties, including the Authorising Officer, the employer will still be strictly accountable to UKVI. The employer should therefore exercise caution, carrying out thorough background checks, to ensure that those allocated to act on their behalf are honest, dependable and reliable.

Sponsorship management system FAQs

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Legal disclaimer

The matters contained in this article are intended to be for general information purposes only. This article does not constitute legal advice, nor is it a complete or authoritative statement of the law, and should not be treated as such. Whilst every effort is made to ensure that the information is correct, no warranty, express or implied, is given as to its accuracy and no liability is accepted for any error or omission. Before acting on any of the information contained herein, expert legal advice should be sought.