Sponsors beware! Clawback clause changes effective 31 December 2024

A UK-based employer who wants to employ non-settled workers to work for them in the UK will often need to apply for, and retain, a worker sponsor licence. The most common worker route under which an employee will be ‘sponsored’ is the ‘Skilled Worker’ route. However, for the purposes of the Home Office’s sponsor guidance, sponsorship covers workers holding permission under several routes including Skilled Worker, Global Business Mobility (Senior or Specialist Worker) and International Sportsperson. This is not an exhaustive list.

The Home Office updated its sponsorship guidance recently to further narrow what costs a sponsor can pass on to its sponsored workers. Since 31 December 2024, it is now expressly prohibited for a sponsor to recoup (or attempt to recoup):

1. Any part of the Certificate of Sponsorship fee from the sponsored migrant. This applies for Certificates of Sponsorship assigned on or after 31 December 2024. The fee is currently £239 for most workers; and
2. Skilled Worker sponsor licence fees or associated administrative costs (including premium services). For illustrative purposes, the cost of applying for a new worker sponsor licence costs £1476 (for a medium / large sponsor).

It was already the position that sponsors could not pass on the Immigration Skills Charge.

All the costs stated above must now be borne by the sponsor. Discovery that a sponsor has been recouping these costs (or that an agreement is in place that the sponsor could attempt to recover these costs) from a sponsored migrant will normally result in the Home Office revoking the sponsor’s licence. It is therefore very important that sponsors review any repayment (clawback) agreements to ensure the terms comply with these restrictions.

For assistance with any queries about clawback agreement or sponsor licences, please get in touch with a member of our Immigration team, or submit an enquiry form, below.