17 January 2025

The new year 2025 had hardly begun when the Home Office introduced some significant changes to its sponsor guidance. These changes are likely to affect many organisations which hold sponsor licences. Sponsors in the UK should be aware of these changes and take action, where required.

We analyse the three most significant changes below.

Additional restrictions on businesses passing on sponsorship costs to workers

Previously, sponsors were only prohibited from recouping the Immigration Skills Charge (ISC) from sponsored workers. Following the recent changes to guidance, sponsors are now also prohibited from recouping the following from workers:

• Certificate of Sponsorship (CoS) assignment fees (this only applies to CoS assigned on or after 31 December 2024)
• Skilled Worker sponsor licence application filing fees and any associated administrative costs including premium service fees – this restriction applies where the sponsor recoups/attempts to recoup these costs on or after 31 December 2024 (ie the prohibition applies even if the cost was incurred (and any clawback agreement made) before 31 December 2024).

The consequences of non-compliance with these prohibitions are serious and may include revocation of a sponsor licence.  Sponsors should therefore carefully review their policies and contractual terms such as clawback clauses to ensure that any necessary amendments are made – not only for future workers but in respect of existing sponsored workers.

Note that the clawback prohibition only applies to licence/sponsorship-related costs. Costs pertaining to a Skilled Worker’s immigration application itself (such as Home Office application fees) may still be passed on to the relevant employees as before. If you are unsure whether a specific cost can be recouped, please contact your assigned LDI lawyer and we shall be pleased to advise.

Changes to ‘key personnel’ roles

Changes have also been made to the requirements for sponsor licence key personnel, requiring at least one Level 1 User (to be known as the ‘primary Level 1 User’) to be both (i) an employee, director or partner of the organisation and (ii) a settled worker (previously these characteristics did not have to be satisfied by a single Level 1 User but could be met by two separate individuals). Failure to have, at all times during the life of the licence, at least one Level 1 User in place meeting these requirements is a ground for revocation of the licence. Whist this requirement technically only applies to sponsors who applied for their licence on or after 31 December 2024, the guidance hints that this is to be reviewed in due course which may impact existing sponsors.  It is therefore advisable for all sponsors to seek to ensure that at least one of their Level 1 Users meets both of these criteria.

Prohibition on sponsoring workers in a personal capacity

The Home Office has also now restricted the ability for sponsors to sponsor workers in a ‘personal capacity’, providing two key examples:

• where the sponsor is an individual or household and is not otherwise conducting business or providing a service in the UK, and
• where the workers would be employed by or engaged for the personal benefit of, an individual who works for the organisation, or a close relative or partner of that individual, and the role is unrelated to the organisation’s wider activities.

Notably, sponsors who were previously permitted to sponsor workers in a personal capacity must not assign any further CoS’ to workers on this basis – raising questions as to the position of such sponsored workers already in post in the UK who had expected to be able to extend their permission.

Having previously removed nannies as a permitted sponsored role, these additional changes extend the Home Office policy that appears to be targeted against skilled workers in domestic/personal service roles. However we consider that further clarification of the intended scope of the policy is required from the Home Office.

Get in touch

To learn more about upcoming changes to UK immigration law, please refer to our website, contact your assigned LDI lawyer or email enquiries@lauradevine.com.