Why a sponsor licence can help your business combat labour shortages

John Vassiliou provides guidance to employers looking to obtain a sponsor licence to hire foreign staff.

8 November 2021

Between Brexit and the pandemic, the UK is experiencing its most severe labour shortage since the 1990s. Businesses can mitigate against these recruitment issues by obtaining a licence from the Home Office to sponsor foreign staff. 

A sponsor licence may not magically generate willing workers, but it will ensure the holder remains agile when an international recruitment opportunity arises. There is no need to have identified a particular candidate before applying for a licence. Many businesses see a sponsor licence as a valuable ‘insurance policy’ to enable future recruitment. 

Immigration basics

  • All non-British, non-Irish citizens need a visa to work in the UK.
  • There are many different types of visa and many different methods of obtaining one. People may hold visas in their own right, or in connection with their family.
  • Some visas allow unrestricted UK labour market access. Others limit or prohibit work entirely.
  • If a non-British, non-Irish citizen already holds a valid UK visa with work permission, any employer can freely employ them. In this scenario, the employer does not need to hold a sponsor licence and does not need to sponsor the worker. 

Skilled worker visas

  • Non-British, non-Irish candidates who do not have a UK visa will likely need to be sponsored in order to come to the UK to work. The UK’s flagship work-based visa is the “skilled worker” visa. This used to be known as a “Tier 2 (General)” visa, but was rebranded on 1 December 2020 in the lead-up to Brexit. 
  • For an individual to apply for a “skilled worker” visa, they must first be sponsored by a licensed employer. 
  • “Skilled worker” applicants must be paid a minimum salary. Generally, this is £25,600 but the minimum can be lower for new entrants to the labour market or for shortage occupation list roles.
  • “Skilled worker” applicants who are not citizens of a majority-English-speaking country must be able to demonstrate that their English language level is above a certain threshold. They can do this by taking an approved examination, or by providing evidence of a suitable degree.
  • Not all job roles are eligible for sponsorship. The Home Office publishes a list of eligible occupations. It is vital to check that a role can be sponsored before proceeding further. 

Sponsor licence application

  • To sponsor an international candidate, an employer must first apply to the Home Office for a sponsor licence. 
  • On average, it takes two to four weeks to put together a sponsor licence application, then a further eight to 10 weeks for a decision. A “priority” service for a faster decision is available for an additional fee, but only ten businesses per day receive this service. Selection is a lottery. It is sensible to proceed on the assumption that a priority service will not be offered.
  • After becoming licensed, the employer must assign a certificate of sponsorship to the candidate. It can take a further few weeks for the candidate to apply for a “skilled worker” visa, receive their visa decision, and arrive in the UK.
  • The majority of our business clients have instructed us to help them apply for a sponsor licence after identifying an international candidate whom they want to start urgently. Without a licence, an immediate start is simply not possible unless the candidate has some other independent right to reside in the UK.

We urge all businesses to consider their future recruitment needs and plans. Even if they do not intend to recruit now, it is prudent to get a sponsor licence in place so they can act quickly in future when they identify a non-British, non-Irish candidate for a particular role. 

For more information, please contact John Vassiliou, Senior Associate in our immigration team, at john.vassiliou@shepwedd.com.