UK immigration updates affecting businesses and individuals
Below we outline some key changes to sponsorship rules, visa fees, and provide some indication of upcoming policy developments for individuals, employers, and sponsors to ensure continuing compliance and strategic workforce planning.
What changes can employers and individuals expect in 2025?
Stricter compliance and enforcement
Employers and employees can expect tighter compliance regulations for employers and increased scrutiny on, for example, salary levels, job roles, and the genuineness of job offers. The Home Office is taking a stronger stance on compliance, and employers who breach visa rules will face stricter sanctions.
Employers can expect:
- Increased audits & inspections – the Home Office has ramped up the frequency and thoroughness of compliance audits and inspections, designed to ensure that sponsors are meeting their obligations, such as maintaining accurate records and reporting changes in circumstances regularly
- Stricter penalties for non-compliance – including doubling the length of time that an employer will be prevented from applying for a new licence if their current one is revoked (see below)
- Where there are repeated breaches, the “cooling off” period (during which an employer would be unable to apply for another replacement licence) will increase from 12 months to two years – currently a cooling off period of longer than 12 months is only possible when the licence has been revoked in specific circumstances.
- Sponsors are to be banned from passing sponsorship costs on to employees. Under the Skilled Worker route can no longer pass sponsorship costs, such as licence and Certificate of Sponsorship (CoS) fees, to employees. This includes clawback provisions in contracts, and non-compliance may result in licence revocation. Businesses should review employment contracts and policies to ensure compliance and mitigate risks – employers found to be passing on any of the immigration skills charge to sponsored employees are already at risk of the licence being revoked.
- It is more important than ever for sponsors to fully understand their obligations. Staying up to date with any changes in immigration law and ensuring that all compliance requirements are met will be crucial for avoiding penalties. Regular training and internal compliance audits can help ensure businesses remain compliant and minimise the risk of any breaches
- Employers who sponsor workers should be sure they are familiar with sponsor guidance updates and ensure that the business’s HR systems and processes are up to date. Consider sponsor licence refresher training or a mock audit to be sure to avoid the risk of the sponsorship licence being suspended or revoked
- Employers should regularly (once every 3 months) review their licence to ensure it is up to date and those with access are aware of their duties and responsibilities in relation to it
Action: sponsors should ensure familiarity with sponsor guidance updates and ensure the business’s HR systems and processes are robust. Consider providing the business with sponsor licence refresher training or a mock audit to help limit the risk of the licence being suspended or revoked.
Surge in enforcement activity to crack down on illegal working
We have seen a rise in number of civil penalties being issued to employers who have not undertaken the required checks on their workers.
Action: understand what compliant right to work checks need to be undertaken before any employment commences, be aware of possible fines and longer term consequences which could affect the sponsorship licence and current as well as future employees.
Key Personnel Requirements for Sponsorship Licences
As of 31 December 2024:
- at least one Level 1 user for new sponsorship licences must be a settled worker and an employee, partner, or director. Outsourcing key roles will be restricted; and
- sponsors should review their personnel structure to ensure compliance
Action: review sponsor licence details and ensure that the authorised personnel are accurately named on the licence and that they are aware of their duties and responsibilities with regard to the licence.
Clawback changes
The Home Office have narrowed what costs a sponsor/employer can pass on to any sponsored workers/employees. It has always been the case that sponsors cannot pass on the Immigration Skills charge (which is either £364 or £1000 per applicant per year, depending on the size of the business), and it is now expressly prohibited for a sponsor to recoup or attempt to recoup
- Any part of the Certificate of Sponsorship fee – the current fee of £239 per CoS, & note that this is due to rise (see below)
- Skilled Worker sponsor licence fees or any associated administrative costs, including any charged for premium services
All of these costs must now be borne by the sponsor – should a sponsor attempt to pass them on, the Home Office will revoke their licence, with potentially disastrous consequences for sponsors/employers and all sponsored employees.
Action: review any repayment clauses in employment contracts to ensure the terms comply with these conditions.
ETA Scheme
From 8 January 2025, non UK nationals who seek to enter the UK must obtain an Electronic Travel Authorisation (ETA) before entering the UK. An ETA is required if a traveller intends to come to the UK and will be travelling without a visa issued for any specific purpose (eg, to work in the UK or if travelling to join a family member). The ETA is valid for stays up to six months and is part of the UK’s efforts to enhance border security and streamline entry procedures.
Action: Employers and individuals should be aware of this change and take required action before embarking on travel to the UK – for example, for business meetings and events. If an ETA is required and an individual travels without one, this will cause travel disruption and delays. Employers should also take a proactive approach and ensure they understand as and when an ETA is required, and that employees have an ETA issued before they travel.
Immigration Fee Increases
The Home Office plans significant fee increases, including a rise in CoS fees from £239 to £525
Other notable increases:
- The Electronic Travel Authorisation (ETA) fee is expected to increase from £10 to £16
- Fee for naturalisation as a British citizen rising from £1,500 to £1,605
Fees associated with applications for permission to stay or switching status are not currently seeing a fee increase.
Action: Consider increases to budgets where migrant workers are relied upon.
Increased digitalisation
As of 1 January 2025, all UK visa holders have been expected to create a UKVI account and apply for an eVisa as part of the visa digitalisation process currently underway. Biometric Residence Permits and Biometric Residence Cards (issued to EU nationals) expired on 31 December 2024 but will be accepted for travel until 31 March 2025, and before that time holders should apply for and obtain confirmation that an eVisa has been issued to them. Individuals who hold a BRP and have not yet transitioned to an eVisa must do so by the end of March.
We can expect digital transformation of the immigration application process, the principal aim of which was to replace physical documents, to continue. Digitalisation will finalise of the move to eVisas which have replaced the stamps and vignettes in passports (as well as hard copy Biometric Residence Permits). Employers as well as individuals are expected to make use of digital applications during the visa application process such as the UK Immigration: ID Check app, and should ensure that they
- Digitalise any hard copy documentation & passport endorsements
- Employees should understand how to set up their UKVI account, and link their eVisa to that account
- Keep their UKVI account up to date
Action: Employers should understand what may be required to support employees who need to transition to and acquire eVisas, and should be mindful of the time limits and the practical steps. Be aware of the steps to be undertaken by those who are currently reliant on a ‘wet ink’ stamp in their passport.
Automatic Grants of Settled Status
The Home Office also made an announcement in relation to the European Union (EU) Settlement Scheme. EU/European Economic Area/Swiss nationals in the UK before the end of 2020 could apply under the EU Settlement Scheme to be granted permission to stay post-Brexit if they have been in the UK for less than five years, pre-settled status is granted, and if they have been in the UK for five years or more, settled status is granted. Pre-settled status holders approaching the end of their permission who have not applied for settled status have been granted automatic extensions for five years (previously two years).
This recent announcement confirms that some eligible people with pre-settled status will now automatically be granted settled status without needing to apply for it. The updated Home Office guidance confirms that settled status will be granted automatically in cases where the person has a UK national insurance number and HM Revenue and Customs, and Department for Work and Pensions, records show the person has been in the UK for at least five years.
Action: EU/Swiss nationals who wish to retain the ability to stay in the UK or to travel in and out regularly and work here should ensure that there are records at HMRC or DWP which confirm that they have been in the UK for at least 5 years, in order to retain the ability to stay and work in the UK over the long term.
Personal Capacity Sponsorship Ban
The Home Office has banned the use of sponsor licenses to sponsor workers in a personal capacity – meaning that individuals and households cannot sponsor workers for personal employment, unless they are conducting business or providing a service in the UK. Sponsors can therefore no longer employ staff exclusively in private households under the Skilled Worker route and breaches will likely result in licence revocation. Individuals or executives are not eligible to be recognised as sponsors, and any worker who will be employed for the personal benefit of a family or individual cannot be sponsored. If, for example, a family business has already been granted a licence in these circumstances, it must not be used to sponsor workers in a personal capacity.
Action: Consider how this will affect domestic employees currently in the UK – eg, nannies & chefs – and what alternatives may be available to them.
Upcoming Immigration Policy Developments
The government plans to link migrant sponsorship to training UK based workers. The Migration Advisory Committee (MAC) is reviewing skills shortages, and this is likely to shape future policy. Individuals and employers should prepare for potential changes to the points-based system and workforce training requirements.
The government have also confirmed their intention to implement a strategy for avoiding the exploitation of sponsored workers, and during 2025, is planning to put in place a range of measures to align employment law compliance with sponsor licence eligibility. These measure may include
- Powers to refuse or revoke a sponsor licence for businesses found guilty of serious employment law breaches
- Strengthening compliance powers with the aim of ensuring greater regulation of licensed sponsors
- Increasing the maximum duration of sponsor licence action plans from 3 months to 12 months, with revocation action to follow if a sponsor fails to follow the action plan, and fails to make the improvements required by the end of the action plan
- Introducing a new sponsorship cooling-off period to at least 2 years for businesses that have their sponsor licence revoked in circumstances where there is repeated non-compliance or serious immigration breaches. During this time, the business will be ineligible for a fresh sponsor licence
Action: Businesses should ensure they understand and comply with their obligations as licensed sponsors as regards the employment of non UK national workers – although the current sponsor licence guidance already provides for a cooling-off period of up to 5 years in more serious cases, it may be that the guidance is amended to say that the minimum period will be 2 years in certain circumstances (instead of the current 1 year), and/or the maximum cooling-off period may be longer than 5 years.
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