Impact of a restructuring on a Sponsor Licence
As a licensed sponsor, it is important to consider the impact of any restructuring in your organisation, no matter how big or small, on your sponsor licence and your sponsored migrants. As we have already established in a previous blog post, a sponsor licence comes with a number of obligations and the organisation is required to report to the Home Office specific changes in the organisation. The questions to ask when involved in any kind of company restructuring includes:
- What type of transaction will take place?
- Which of the organisations involved have a sponsor licence?
- Who are the sponsored migrants in the organisations?
- Will the sponsored migrants be impacted by the transaction?
- How will the sponsored migrants be impacted by the transaction?
Sponsor licences are not transferable therefore organisations will need to consider the impact of:
- Changing direct ownership
- Selling the whole or part of the business organisation
- Selling the whole or part of the controlling shares
- Being taken over in whole or in part by another organisation
- Splitting from an organisation and forming a new organisation
You are required to report a change of ownership, takeover, a merger or demerger and failure to do so can lead to migrants having their leave curtailed. Once you have reported the change, the Home Office may request specific documents to be submitted to support the change.
What to do if completely merged into another organisation?
If you are completely merged into another organisation and your sponsored migrants move to the new organisation you are required to:
- Report the change using the sponsor management system (SMS) account
- This report must be done within 20 working days of the change
- Report any migrants who are not moving to the new sponsor
- Confirm if you need to surrender your sponsor licence
What to do if you are merged with another sponsor organisation?
If you are merged with another sponsor organisation and their migrants are moving to you you, as the new organisation sponsor you are required to:
- Make a valid application for a sponsor licence within 20 working days of the date the migrants move to you, as set out in Tier 2 and 5 guidance for sponsor version 01/19
- Use the SMS to apply for an increase in the allocation of Certificate of Sponsorships, if necessary
- Report the change using the SMS within 20 working days of the change taking place
- Report the migrants who have transferred from the old sponsor organisation
- Where sponsored migrants are being moved under TUPE, the new organisation must take up full responsibility, from the date of the move, as their new sponsor
- If the new organisation does not have the required sponsor licence to sponsor the migrants, you must make a new application within 20 working days
What to do if the sponsored migrants role changes?
- An assessment will need to be made to the change of employee’s role, title and salary post transfer in order to determine whether or not a new application for leave is required
- If a new application for leave is required, a fresh Certificate of Sponsorship and application will need to be made and in some cases a resident labour market test will be required
Contact Our Sponsor Licence Immigration Barristers
It is important that you consider the impact of any company restructuring on your sponsor licence and sponsored migrants to ensure you retain your licence and the migrant’s permission to work is not jeopardised.