The hospitality industry plays a key role in the UK’s diverse labour market, employing millions of people and contributing significantly to the economy. However, following Brexit and the end of freedom of movement, the UK hospitality sector is experiencing an acute skills shortage. Ongoing changes to immigration laws have also created uncertainty and made it difficult for employers to employ hospitality workers from overseas. We covered a report which highlighted some of the challenges facing employers here.
To recruit more diverse and outstanding talent from around the world, it is important for employers to understand and comply with current immigration law. In this article, we will explain how hospitality businesses can employ hospitality workers from overseas to fill their vacancies.
Applying for a Sponsor Licence
For UK hospitality businesses planning to recruit overseas workers, it is essential that the business first applies for and obtains a Sponsor Licence from the Home Office.
Many people have a misconception that only large, high-income companies can obtain a sponsor licence and employ overseas workers. In fact, there is no lower limit for business size when applying for sponsor licence in the UK. Therefore, if run properly, it is also possible for small businesses, such as small takeaway shops and nail salons to be granted a sponsor licence and hire skilled workers from overseas.
To apply for a sponsor licence as an employer in the UK, employers usually need to make sure that the business has the necessary HR system to manage the sponsorship process and meet the sponsor licence duties. They need to prove that they have the genuine need to sponsor overseas workers for eligible roles and that they will pay a salary that meets the minimum requirements of the skilled worker visa.
Key personnel for sponsor licence
At the same time, the employers need to make sure they have key personnel who are “honest and dependable”. The key personnel would be the authorising officer, key contact, and level 1 & 2 users. An authorising officer is a senior person who’s got the ultimate responsibility for the licence as well as any immigration issues. The key contact is the primary person who communicates with the Home Office, and the Level 1 user should be a British or settled person who is responsible for the day-to-day management of the sponsorship licence and the application for the skilled worker visa (unless the authorising officer is on a Tier 1 visa).
It is up to them to ensure that all of the licence duties as a sponsorship holder are met. All three of these roles can be performed by the same person, in other words, a one-person small company can have the opportunity to apply for a sponsorship licence. However, it is important to note that the above key personnel must not have a criminal or penalty record, as this may affect the licence application.
Do I need a physical office when applying for a sponsor licence?
In light of the rise in remote work, many companies no longer maintain on-site offices, and the Home Office does not strictly require all sponsors to have a physical office. However, for most hospitality companies, a physical office or shop is still necessary. Therefore, the necessity of leasing an office when applying for a work visa qualification must be evaluated on a case-by-case basis, taking into account the specific operational requirements of the company in question.
The core of applying for a sponsorship licence is to prove that the business is genuine, operating, and trading lawfully in the UK. Once an employer submits the sponsorship licence application, the Home Office may also arrange a pre-compliance visit to check if the business really meets the requirement.
Skilled worker visa for hospitality workers
With the sponsor licence, employers can apply for the skilled worker visa for their foreign candidates. The UK Skilled Worker Visa route enables hospitality businesses such as hotels and restaurants to bring highly skilled overseas workers to the UK on either a temporary or long-term basis. Read our guide to the skilled worker visa here.
Employers then need to apply for a certificate of sponsorship (CoS) and use the certificate to apply for the skilled worker visa for foreign worker to the UK. Employers must assign a CoS to each foreign candidate from the Home Office and each CoS can only be used once. Once the certificate is assigned, the worker must apply for a visa within 3 months.
What fees do I need to pay to employ hospitality workers from overseas?
Regarding the costs that employers are most concerned about, there are three important fees that need to be paid if you want to employ overseas staff.
The first is the application for a sponsor licence, which is £536 for small businesses.
The second is the Certificate of Sponsorship (CoS) application fee, the key to the skilled worker visa application, with one proviso for each candidate and an application fee of £239.
The Immigration Skills Charge is a tax levy applied to businesses that employ foreign workers. For small businesses, the skills surcharge is £364 for the first year and £182 for every six months thereafter. Therefore, the cost of sponsoring an oversea employee for five years can be up to £1,820.
According to the immigration law, it is the responsibility of the employer to pay the three fees. Other fees, such as skilled worker visa application fees, immigration health surcharges, are not mandatory by law. Companies will either require the employee to pay these themselves or offer to cover them.
The financial costs of employing overseas staff are sometimes forgotten about by the wider public, but are an important consideration for UK employers, particularly for smaller business.
Other responsibilities
While a sponsor licence has been granted, this does not automatically entitle the employer to issue a UK work visa to any foreign employee. When employing overseas staff, it is essential for UK employers to align the requirements for the candidate role with the standards of skilled worker visa requirements.
Minimum salary
Employers should also ensure that the salary offered to the candidate can meet the minimum standard of skilled worker visa. The Home Office has updated the Skilled Worker salary standard earlier this year, with the minimum salary for a skilled worker visa increasing from £26,200 to £38,700. It is worth noting that, however, the £38,700 figure does not apply to all applicants.
The Home Office has also set out a series of requirements based on different length of work experience and different industries. The rise to the minimum salary for skilled worker visas has had far-reaching effects on hospitality’s labour shortage, particularly in entry-level and junior positions, which are usually in lower salaries. Employers should analyse each candidate’s situation thoroughly and adjust their costs and staffing needs when hiring oversea workers.
Informing the Home Office and Updating Records
Hiring overseas employees is not just about obtaining work visas for them. The employers have the responsibility to inform the Home Office about any changes to the employee’s work and keep updated records. The Home Office has the right to visit and review the relevant documents at any time.
Failure to fulfil the employer’s responsibilities may result in the cancellation of the employee’s UK work visa, as well as potential fines and the suspension or revocation of the employer’s sponsor licence. The Home Office has been conducting increasingly strict compliance checks on sponsor companies, particularly when it comes to hospitality businesses. In the second quarter of 2024, 499 work permits were cancelled and 524 were suspended. This is almost double what it was in the first quarter of 2024, when 519 were either suspended or cancelled.
Medium and big companies usually have more comprehensive HR systems which allow them to operate their records better. Small companies may not have such a system to keep them informed about legal requirements and the consequences of non-compliance. It is therefore crucial for small business employers to maintain good record-keeping and update information in a timely manner.
Which hospitality jobs are classed as being high-skilled roles?
The Home Office uses the job’s Standard Occupational Code (SOC) to assess whether a job is eligible for the Skilled Worker Visa route. While some hospitality and blue-collar jobs may not traditionally be viewed as highly skilled, there are some certain hospitality worker jobs that are eligible under the route and appear in the SOC list. We have organised some common high-skilled roles in hospitality industry: We have listed some of the most common qualified high-skilled roles in the hospitality industry.
- Production managers and directors in construction
- Managers and proprietors in agriculture and horticulture
- Hotel and accommodation managers and proprietors, including caravan park owners, hotel managers, and landladies (boarding, guest, lodging house)
- Restaurant and catering establishment managers and proprietors, including café owners, fish & chip shopkeepers, operations managers (catering), restaurant managers, and shop managers (takeaway food shop)
- Chef, Chef-manager, Food stylist, Head Chef, Pastry Chef
- Cook, Cook-supervisor, Fish fryer, Head cook
- Bar manager, Catering manager, Floor manager (restaurant), Kitchen manager, Steward(club)
- Publicans and managers of licensed premises
- Leisure and sports managers, including amusement arcade owners, leisure centre managers, social club managers, and theatre managers
- Travel agency managers and proprietors
- Hairdressing and beauty salon managers and proprietors
- Conference and exhibition managers and organizers, including conference coordinators, event organizers, events managers, exhibition organizers, and hospitality managers
- Dance choreographers
- Garden designer
Conclusion
The changing immigration rules have made it challenging for UK employers to manage staffing and operating costs, especially hospitality businesses. It is especially important to ensure that employment processes are legally compliant. Lisa’s Law’s Immigration team is experienced in assisting in such matters. We will be able to advise you on the latest requirements and guide you throughout the process.
Should you wish to know more information about the UK sponsor licence or, indeed, skilled worker visa, please do not hesitate to contact Lisa’s Law and our experienced solicitors will be happy to assist you.
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