Company Has Sponsor Licence Revoked – How You Can Avoid The Same Fate

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R (Sri Prathinik Consulting Limited) v Secretary of State for the Home Department [2017] EWHC 3204 (Admin)

Late last year, the High Court upheld a decision by the Secretary of State to revoke an organisation’s Tier 2 Sponsor Licence after they failed to issue a Certificate of Sponsorship (CoS) six months after the Residential Labour Market Test (RLMT) was completed.

According to recent report, 60% of UK businesses may trigger their Brexit contingency plans by the end of the first quarter if there is no transitional agreement put in place by the government.  This is partly in response to the first full set of figures from the Office of National Statistics on the number of EU nationals migrating to the UK was released in November 2017.  They showed the number of Polish and other east European nationals working in Britain dropped for the first time in more than 10 years, down from 1,054,000 in the summer of 2016 to 1,035,000 in August 2017. 

As part of their Brexit contingency plans, sectors who rely heavily on EU workers such as construction, agriculture, tech, elderly care, and hospitality have, as part of their Brexit contingency plans, begun to apply for Tier 2 Sponsor Licences.  This allows them to recruit talent from anywhere in the world.  Implementing such a strategy also ensures the organisation has an existing Sponsor Licence, should the government introduce the same immigration controls to EEA nationals as are currently placed on non-EEA citizens wishing to come to Britain to work.  These organisations are relying on the best immigration law advice available from London solicitors.

The case of R (Sri Prathinik Consulting Limited) v Secretary of State for the Home Department illustrates how strictly organisations must comply with Home Office duties and responsibilities when they hold a Sponsor Licence.  In addition, the court’s have made it clear they will provide little relief if a Sponsor Licence holder is in breach of compliance.

The facts of the case

The claimant had been issued a Tier 2 Sponsor Licence so it could recruit the IT expertise it needed from countries outside the EEA.  After being granted the licence, it acquired nine employees, eight of whom were Tier 2 migrants.

Home Office officials paid an unannounced visit to the premises and found the evidence of the RLMT for one of the migrants was missing.  This failure to retain evidence breached Appendix D of the Tier 2 and 5 Sponsor Guidance.

The claimant’s Sponsor Licence was duly suspended, and the Home Office cited inadequate record keeping as the reason.

Subsequent investigations by the claimant recovered the records relating to the relevant RLMT; however, the CoS was not issued until more than six months after completion of the RLMT.  This was a breach of paragraph 29.2 of the Sponsor Guidance, which states:

“All CoS, restricted or unrestricted, must be assigned within 6 months of the date the vacancy was advertised.”

The Home Office stated that failure to comply with paragraph 29.2 gave grounds for mandatory revocation of the licence.

The claimant tried to argue that the RLMT and issuing of CoS were separate breaches of Sponsor Licence duties and responsibilities, and should therefore attract different penalties if they were breached.

The court disagreed.  Anthony Elleray QC, (sitting as a Deputy Judge of the High Court) held that for the RLMT to work, CoS assignment needed to take place within six months, commenting:

“I stress that the Tier 2 Sponsorship scheme permits the CoS assignment by a Sponsor employer of a migrant to a particular job which cannot be filled by a settled EEA worker. Sponsors have advantages and cannot complain if they are required to comply with relevant Guidance.”

He went on to say:

“I do not consider that it is possible to isolate the CoS from the RLMT in the manner argued by Mr Biggs as a matter of construction of the relevant Guidance or generally. Paragraph 29.2 of the Guidance made clear that all CoSs must be assigned within six months of the date the vacancy was first advertised. That involved a time limit on assigning the CoS following the RLMT. The limit needed observance to ensure satisfaction that the migrant was not taking a place that could be filled by the Resident Labour Market. Paragraph 29.3 emphasised that point.”

The application for judicial review of the revocation of the claimant’s Sponsor Licence was duly dismissed.

How businesses can avoid having their Tier 2 Sponsor Licence Revoked

Revocation of a Tier 2 Sponsor Licence can be catastrophic, not only to your organisation, but to any employees on a Tier 2 visa.  They may have to leave the country if they cannot find another employer to sponsor them.

To avoid having your Tier 2 Sponsor Licence revoked, you must take affirmative action from the first day you decide to apply for a licence.

From the outset, your HR policies and procedures must be aligned with Sponsor Licence duties and responsibilities.  OTS Solicitors is a highly-ranked Legal 500 firm and expert immigration lawyers in London.  They can visit your premises and assess the strengths and weaknesses of your HR systems before the Home Office schedules its visit to assess if your organisation is able to comply with Sponsor Licence duties.

In addition, our team can act as your Key Personnel, updating the Sponsor Management System (SMS) on your behalf and running RLMT for you.  By instructing competent professionals, you can be confident breaches such as issuing a CoS out of time will never happen.

Around two thirds of businesses do not fully understand the depth of compliance required when they first obtain a Tier 2 Sponsor Licence.  The British government’s agenda for the past five years or so has been to reduce immigration figures.  Therefore, the Home Office will pounce on any business that is seen to be hiring migrants, rather than settled UK workers and/or breaching Sponsor Licence compliance responsibilities.

Rather than take unnecessary risks, it is more cost-effective and less stressful in the long-run to rely on the experts to manage the process for you, so you can get on with growing your venture.

OTS Solicitors is one of the most respected immigration law firms in London and is a Legal 500 leading firm.  By making an appointment with one of our business immigration solicitors, you can be assured of receiving some of the best legal advice available in the UK today.  Contact us on 0207 936 9960 to speak to one of our immigration consultants.

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