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Government clamps down on visa sponsorship compliance

Government efforts to reduce the demand for migrant labour and cut net migration are resulting in a rise in checks on visa sponsors.

Companies and organisations which fail to abide by the conditions of visa sponsorship face the prospect of losing their licence to employ migrant workers.

What has happened?

There has been a marked increase in UK Visas and Immigration (UKVI) compliance visits to the holders of Tier 2 sponsor licences.

As mentioned in a previous newsflash Tier 2 visas are the primary route for economic migration to the UK for non-EU nationals. Companies with Tier 2 sponsor licences are permitted, within restrictions, to employ workers from outside the EU.

The recent wave of UKVI compliance visits has resulted in an increase in Tier 2 sponsor licence suspensions or revocations by the Secretary of State for what previously may have been seen as relatively minor infringements of the considerable record keeping obligations placed upon licence holders.

The recent case of Raj and Knoll Limited v Secretary of State [2015] EWHC 1329 (Admin) is one of the first cases to come before the courts in respect of the Tier 2 Points-Based System and provides a stark warning to Tier 2 sponsor licence holders that non-compliance with the Sponsor Guidance will not be tolerated.

What did this case involve?

This case involved review of the Secretary of State’s decision to revoke a Tier 2 sponsor licence. The claimant – Raj and Knoll Limited – ran three nursing homes and in 2013 employed a total of 39 Tier 2 migrants as workers. In May 2014, the Secretary of State suspended the claimant’s licence for failure to comply with its sponsor duties. She granted the claimant the opportunity to make representations to explain the issues identified, within 20 days, before beginning revocation action.

In June, the Secretary of State revoked Raj and Knoll’s licence on the grounds of failure to retain evidence of the residential labour market test and failure to report a change of business and location of employees. The effect of the revocation was that the claimant was no longer able to employ non-EEA migrants. In July the Secretary of State maintained that revocation.

Raj and Knoll subsequently sought judicial review on the basis that (i) the Secretary of State had misconstrued the Sponsor Guidance and had erred in law by assuming that the case had involved mandatory revocation; (ii) the Secretary of State’s view that it had breached its sponsorship duties had been irrational; and (iii) the Secretary of State had failed to appreciate that she had a discretion to take action short of revocation, for example suspending or downgrading the claimant’s licence.

What did the court say?

The court found that there was no substance in any of the claimant’s arguments and dismissed its judicial review challenge to the Secretary of State’s decision. Further, the postscript to the judgment has left no doubt as to the approach the courts will take when reviewing the Secretary of State’s decisions.

In dismissing the claimant’s challenge, Mr Justice Haddon-Cave suggested that companies in a similar position should heed the words of McGowan J in London St Andrews College v Secretary of State for the Home Department (2014) EWHC 4328 (Admin) [36]:

“It must be understood that the grant of [sponsor] status is a fragile gift, constant vigilance about compliance is a minimum standard required for such sponsors. The burden of playing an active role in the support of immigration control is a heavy one. The [Secretary of State] is entitled to review purported compliance with a cynical level of supervision.”

What does this mean for me?

If you are an employer holding a Tier 2 sponsor licence then this increased scrutiny on compliance is something of which you need to be aware. In many cases revocation of a sponsor licence could have a disastrous impact on an employer’s business, with key skilled workers being unable to enter the UK to work for you, existing migrant workers leaving your employment or potentially having to leave the UK altogether. The financial and commercial impact of this could be considerable.

With Tier 2 sponsor licence holders coming under increasing scrutiny, it is important that you are aware of your duties to UKVI as a registered sponsor, understand how to comply with these duties, have the relevant checks and systems in place and know which changes to your business, staff and sponsored migrant workers you need to report to UKVI and the timescales within which these reports must be made.

Also, if you do find yourself unjustifiably on the wrong end of a notice, suspension or revocation of your sponsor licence, it is imperative that you obtain very clear expert advice and assistance, so as to put yourself in the best possible position to defend yourself.

How can Ward Hadaway help?

We can assist Tier 2 sponsors at all stages of the process.

We have the knowledge, skill and expertise to help you apply for a sponsor licence and comply with your sponsor obligations and, should it become necessary, to review your position and provide the necessary advice and assistance to contest a proposed suspension or revocation of your licence.

This could include drafting clear and concise representations in response to a notice of suspension or revocation; collating and submitting the necessary supporting evidence; and, if necessary, challenging UKVI’s decision by way of a judicial review.

How can I find out more?

For further information on how we can help with judicial reviews and challenges to Secretary of State decisions, please contact either Robert Glassford or Lucy Cleghorn.

For help with general sponsorship and immigration queries please contact Flora Mewies.