As the global economy becomes increasingly interconnected, businesses in the UK are increasingly looking to widen their talent pool by recruiting skilled workers from overseas.
However, to do this, they need to navigate a complex and potentially costly process of obtaining a sponsor licence, particularly when not following correct application procedures. This comprehensive cost guide will give you a detailed understanding of all associated costs and procedures involved in obtaining a sponsor licence.
Understanding the Sponsor Licence
A sponsor licence is a legal requirement for any UK-based organisation wishing to employ overseas workers. The licencing process involves several stages, each with its own set of costs and responsibilities. The licence allows employers to issue Certificates of Sponsorship (CoS) to prospective employees, which form a crucial part of their visa application.
Determining the Type of Sponsor Licence You Need
The type of sponsor licence you need depends on the nature of the roles you are looking to fill. There are two primary types of licences: 'Worker' and 'Temporary Worker'.
- The 'Worker' licence enables you to recruit migrant workers for various skilled positions, typically long-term roles such as the Skilled Worker route.
- The 'Temporary Worker' licence is designed for sponsoring workers in short-term roles, including certain Global Business Mobility routes.
Sponsor Licence Application Fee
The cost of applying for a sponsor licence depends on the size and charitable status of your organisation.
- For a 'Temporary Worker' licence, the fee is £536, irrespective of the size or type of your organisation.
- For a 'Worker' licence, the fee is £536 for small or charitable sponsors and £1,476 for medium or large sponsors.
Defining Small, Medium, and Large Sponsors
Small sponsors are typically defined by the following criteria:
- Annual turnover of the business is £10.2 million or less
- Total assets of the business are worth £5.1 million or less
- The business employs 50 people or fewer
Medium or large sponsors are typically those with an annual turnover exceeding £10.2 million and assets worth more than £5.1 million.
What is a Charitable Sponsor?
Charitable sponsors are those that are:
- Registered charities in England, Wales, Scotland, or Northern Ireland
- Excepted or exempt charities
- Ecclesiastical corporations established for charitable purposes
Fast-Track Sponsor Licence Fee
While most sponsor licence applications are processed within eight weeks, you can opt for a faster decision by paying an extra fee for a priority service sponsor licence application. This expedited service aims to provide a decision within ten working days.
How Much is the Certificate of Sponsorship Fee?
In addition to the sponsor licence application fee, there is a fee for assigning each Certificate of Sponsorship to a migrant worker. The cost is £25 for the 'Temporary Worker' routes and £239 for the 'Worker' routes.
Optional Sponsor Licence Premium Service Fees
After obtaining a sponsor licence, you can opt for a premium customer service, which provides an enhanced level of support for organisations employing migrant workers. The cost for this service is £25,000 for medium or large sponsors and £8,000 for small or charitable sponsors.
Immigration Skills Charge
The Immigration Skills Charge (ISC) is an additional cost that you may have to pay when assigning Certificates of Sponsorship to new recruits. The charge is set at £364 for the first 12 months for small or charitable sponsors, plus £182 for every additional six months. For medium or large sponsors, the charge is £1,000 for the first 12 months, plus £500 for every additional six months.
Sponsor Licence Renewal Fee
A sponsor licence typically lasts for four years, after which you will need to renew your licence and pay a further application fee.
Read more: Sponsor Licence Renewals
Cost of Upgrading a Sponsor Licence
If, during the validity of your licence, you fail to meet your sponsorship duties and your licence is downgraded to a B-rating, you will have to pay a fee of £1,476 to upgrade back to an A-rating.
Ongoing Sponsor Licence Costs
In addition to the licence fee and other associated costs, there are minimum salary requirements for sponsoring a migrant worker. The proposed salary for your new overseas recruit must meet the general salary threshold or the 'going rate' for the selected occupation.
You may also choose to cover the costs associated with the worker's visa application, including the visa application fee, premium processing fee, and annual healthcare surcharge.
Get in Touch for Sponsor Licence Assistance
Successfully obtaining a sponsor licence can be a complex process, and it is advisable to seek professional assistance to ensure a successful and stress-free application. Our specialists, in tandem with the Borderless platform, can provide expert guidance on best practice for sponsor licence applications and avoiding enforcement issues.
If you have any concerns or questions about the sponsor licence process, don’t hesitate to contact us for expert support.
