Sponsor Licence Downgrading, Suspension and Revocation

From licence grant to expiry, sponsors are subject to a defined set of duties under UKVI guidance. Ensuring robust systems are in place before applying for a Sponsor Licence is essential to meet these obligations and maintain compliance.

Sponsor duties include:

• Timely reporting of specified events via the Sponsor Management System (SMS).
• Maintaining accurate records for each sponsored worker.
• Adhering to immigration laws, sponsor guidance, and broader UK legislation, including employment law.
• Avoiding conduct that may be considered contrary to the public good.

These duties are designed to safeguard the integrity of the sponsorship system, prevent abuse of immigration routes, and monitor ongoing compliance. UKVI conducts regular oversight, and sponsors found to be in breach may face enforcement action – including downgrading, suspension, or revocation of their licence.

UKVI has wide-ranging powers to carry out compliance checks on sponsors – both prior to the grant of a Sponsor Licence and throughout its duration. These checks may involve requests for additional documentation, cross-referencing with HMRC, reviewing public allegations, conducting on-site visits (announced or unannounced), or remote digital inspections.

During a compliance review, UKVI Compliance Officers assess whether:

• The information provided by the sponsor is accurate and complete.
• The organisation is actively meeting its sponsorship duties, supported by appropriate HR and recruitment systems.
• The business is genuine and trading/operating lawfully in the UK.
• The sponsor is offering genuine employment opportunities.
• The sponsor poses no threat to immigration control.
• The sponsor has not and is not engaged in conduct contrary to the public good.

Compliance officers may verify records, inspect systems, interview sponsored workers and recruitment staff, and assess the sponsor’s operational practices. Full cooperation is expected, including granting access to any premises under the sponsor’s control.

UKVI does not provide feedback during the inspection, and sponsors will not be informed of the officer’s assessment or outcome until the review is complete.

UKVI will notify sponsors in writing following the completion of a compliance check. While no action may be taken in some cases, any breach – or suspected breach – of sponsorship duties, or concerns around immigration control or public conduct, will prompt further assessment.

Depending on the severity of the issue, UKVI may:

• Downgrade the Sponsor Licence to a B-rating;
• Suspend the Sponsor Licence with a view to revocation; or
• Revoke the Sponsor Licence without prior suspension.

Minor breaches typically result in downgrading, whereas more serious concerns may lead to suspension or revocation. A more serious breach is where there are indications of:

• Significant or systemic failings.
• Failure on the part of the sponsor to meet eligibility or suitability criteria.
• Conduct on the part of the sponsor that poses a serious threat to immigration control.
• Behaviour/actions on the part of sponsor deemed contrary to the public good.

Sanctions may also apply where illegal working is identified. Sponsors are advised to maintain rigorous compliance standards to avoid penalties – more information on enforcement and how to mitigate risk is available here.

Sponsors granted a licence by UKVI are automatically awarded an A-rating, a recognition that the organisation has the systems in place to meet its compliance obligations. Maintaining this rating requires ongoing adherence to the duties set out in UKVI guidance.

Where UKVI identifies a minor breach – such as inadequate processes to comply with sponsor duties or failure to provide requested information – the licence may be downgraded to a B-rating. This indicates that while the sponsor is not currently meeting all duties, UKVI believes the issues can be resolved through an action plan.

If downgrading is proposed, the sponsor will receive written notice and will have 20 working days to respond in writing. The B-rating takes effect from the date of the decision letter. During this period, the sponsor cannot assign Certificates of Sponsorship (CoS) to new workers and must:

• Pay the action plan fee to receive an action plan from UKVI; and
• Comply with the time-limited action plan to restore its A-rating.

A B-rating is transitional and must be resolved and upgrading to an A-rating within 3 months. Failure to do so will result in Sponsor Licence revocation. At the end of the 3 month period, UKVI will conduct a further compliance check, with 3 possible outcomes:

• The sponsor is found to not have met the requirements of their action plan, or more serious areas of non-compliance arise – this will result in revocation of the licence;
• Certain areas of non-compliance have arisen which are not addressed by the current action plan – this will result in a new, second action plan which must be paid for; or
• The sponsor has met all the requirements of the action plan and there are no other concerns about the Sponsor – this will result in the restoration of the Sponsor’s A-rating.

Sponsors may only be subject to a B-rating and action plan a limited number of times. If this threshold is reached and there is further reason for downgrading, the Sponsor Licence will be revoked.

Where UKVI identifies sustained non-compliance, or serious or systemic failings – often arising from a series of minor breaches – it may suspend a Sponsor Licence without first downgrading it. Suspension typically occurs where the sponsor is found to be in breach of its duties, poses a risk to immigration control, or is engaged in conduct contrary to the public good.

Common grounds for suspension include:

• The sponsor is found to have knowingly given false information on the Sponsor Licence application or in support of the application, and the licence would have been refused had the correct information been given;
• The sponsor is convicted or has an unspent conviction for a relevant offence;
• The sponsor stops having, or never had, a trading/operating presence in the UK;
• The sponsor does not hold, or stops holding, appropriate planning permission or Local Planning Authority consent to operate the type/class of business at their trading address; or
• The sponsor gives false information in any application for, or request to assign, a CoS, or a request to renew the annual allocation of CoS.

UKVI may suspend a Sponsor Licence with or without conducting a full investigation. Sponsors will receive written notification and have 20 working days to respond. If no response is submitted, UKVI will proceed with the action it deems appropriate.

Action taken may include one or more of the following:

• Reinstatement of the licence with an A-rating;
• Reinstatement with a B-rating and an accompanying action plan;
• Restrictions on assigning new Certificates of Sponsorship;
• Cancellation of unused CoS allocations; or
• Revocation of the licence.

UKVI does not provide feedback during the review period, and sponsors must await the final decision – typically issued within 20 working days of their response.

During suspension, sponsors are unable to assign CoS and cannot make changes to key personnel roles such as the Authorising Officer or Key Contact. Functions to add new Level 1 Users automatically will also be suspended.

UKVI may revoke a Sponsor Licence in a range of circumstances, including – but not limited to – where:

• The sponsor no longer has, or never had, a trading presence in the UK;
• The sponsor fails to meet the requirements of the route(s) under which it is licensed;
• There is evidence of serious or systemic breaches of sponsor duties;
• The sponsor poses a threat to immigration control;
• The sponsor has been convicted of a relevant criminal offence or issued with a specified civil penalty; or
• The sponsor has engaged in conduct that is not conducive to the public good.

The sponsorship guidance provides detailed guidelines on circumstances where a licence:

• Will be revoked on a mandatory ground;
• Will normally be revoked unless there are exceptional circumstances; and
• May be revoked.

Sponsors will be notified in writing if their licence is revoked. There is no right of appeal. If a sponsor wishes to reapply for a Sponsor Licence, they must wait for a minimum “cooling-off” period of 12 months – or longer, if specified – before submitting a new application.

Revocation applies across all routes under which the sponsor is licensed. The organisation will be removed from the public register of licensed sponsors and will no longer be permitted to sponsor workers. Any existing sponsored workers will have their permission curtailed, cancelled, or denied.

The impact of revocation on affected workers is significant. Where UKVI determines that a worker was complicit in the reasons for revocation, their permission will be cancelled immediately, and they will be required to leave the UK or face enforced removal. Workers not found to be complicit will typically have their permission shortened to 60 calendar days, during which they may apply for a new visa or make arrangements to depart the UK.

Whether navigating a licence downgrade, suspension, or revocation, our Immigration team provides strategic, practical support to help sponsors respond effectively. We advise on sponsor duties, assist with representations to UKVI, and guide clients through the Sponsor Licence application process with clarity and confidence. If you require tailored advice or assistance, please don’t hesitate to contact our Immigration team.