Illegal working and sponsor licence compliance: enhanced government enforcement and employer guidance

The Home Office has significantly increased its focus on enforcement activity in relation to sponsor licence compliance and prevention of illegal working (whether or not the employer in question holds a sponsor licence).

The Home Office reported having revoked 1,948 sponsor licences between June 2024 and June 2025 – that is more than double the number from the previous year (937). In other words the Home Office are clamping down on the misuse of sponsor licences and are taking enforcement action against those who they consider are exploiting the system. The Home Office report using more sophisticated and improved data and intelligence sharing across government and legal departments to identify the rule breakers. The upward trend of licences being revoked is expected to continue, with the Home Office expected to continue to implement increased checks.

The practical implication of this is that the Home Office is undertaking more site visits and audits, both across companies generally and in particular those holding sponsor licences. These improved checks have highlighted cases where sponsors are failing to complete right to work checks, are underpaying sponsored staff and general misuse of the immigration system for sponsored workers. Common issues flagged by the Home Office include incomplete or missing right to work checks; underpayment of sponsored workers; and sponsored staff working in roles not aligned with their visa conditions.

While the Home Office highlighted certain sectors as having higher levels of abuse (these include social care, hospitality, retail and construction), we recommend all employers undertake checks and internal audits of the systems they have in place to prevent illegal workers. Employers holding sponsor licences are typically subject to heightened scrutiny. Given the potentially far-reaching consequences of non-compliance (which include civil penalties, licence revocation, reputational damage, and in some cases, business closure or prosecution), we recommend employers review their procedures, policies and systems to ensure these are fully compliant with Home Office requirements.

At Farrer & Co, our Immigration team regularly supports employers who have encountered enforcement action by the Home Office and assisted with compliance reviews and mock audits to help identify and resolve risks before they become issues. For tailored advice, please contact Elena Hinchin or Sarah Pullin.

This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.

© Farrer & Co LLP, September 2025