Sponsor licence suspension and revocation

Overview

The Home Office's powers are set out in Part 3 of its guidance for sponsors. In short:

• Downgrade: for relatively minor breaches, your A-rating becomes a B-rating and you must follow a three-month action plan.
• Suspension: while the Home Office looks into more serious concerns, you cannot assign certificates of sponsorship and you are removed from the public register of sponsors.
• Revocation: the licence is taken away, your sponsored workers' permission is normally cut short, and you cannot apply again for at least 12 months.

The guidance lists the grounds in annexes. Annex C1 grounds lead to mandatory revocation, sometimes immediately and without warning. Annex C2 grounds normally lead to revocation unless there are exceptional circumstances. Annex C3 grounds are discretionary: one on its own rarely leads to revocation, but several together may. A breach does not have to be deliberate.

The Home Office now uses these powers far more often: it reports 1,948 revocations between July 2024 and June 2025, more than double the previous year. There is no right of appeal against revocation, so your written response to a suspension notice is usually the most important document in the case.

Who this is for

• Sponsors who have received a letter proposing a downgrade, or a suspension notice.
• Sponsors who have been downgraded and must complete an action plan.
• Sponsors whose licence has been revoked and who want to know whether the decision can be challenged.
• Sponsored workers whose employer's licence has been suspended or revoked (see also our Skilled Worker visa page).

If you are worried about a coming compliance visit but have not received a letter, start with our page on sponsor licence compliance.

Requirements

Downgrade and action plans

Before downgrading you, the Home Office writes setting out the proposed action and its reasons. You have 20 working days to respond in writing; there is no oral hearing. If you are downgraded:

• you must pay the action plan fee within 10 working days, or the licence is revoked;
• the action plan lasts three months and sets out specific steps you must take;
• you cannot assign certificates to new workers, only to existing workers who need to extend their stay;
• you can be B-rated no more than twice in any rolling four-year period.

If you complete every step, you return to an A-rating. If you do not, the licence is revoked.

Suspension

A suspension notice sets out the reasons. You have 20 working days from the date of the letter to respond in writing with evidence. The Home Office can allow more time in exceptional circumstances, and gives a further 20 working days if it adds new reasons. It aims to decide within 20 working days of your response.

While the licence is suspended, you cannot assign certificates on any route. Workers who already have permission can keep working. Their applications supported by certificates you assigned before the suspension, and settlement applications you support, are held until the matter is resolved. Workers who already have an entry clearance visa can still travel, unless the licence is revoked first.

Common grounds for revocation

The mandatory grounds in Annex C1 include:

• a role that is not genuine, or a worker whose actual job does not match the occupation code or job description on the certificate;
• paying a worker less than the certificate states, without permitted grounds and without telling the Home Office;
• supplying sponsored workers to third parties as an employment agency;
• a sponsor system user assigning a certificate to themselves, a close relative or a partner;
• giving false information, or a relevant unspent criminal conviction;
• ceasing to trade, or losing a registration the business needs, such as Care Quality Commission registration;
• failing to meet an action plan, or not paying for it on time.

How the process works

1. Concerns arise from a compliance visit, a request for documents, or information from another department such as HMRC.
2. You receive a letter proposing a downgrade, or suspending the licence, with the reasons.
3. Within 20 working days, you send written representations and evidence answering each point and explaining what you have already done to put things right.
4. The Home Office decides: reinstatement with an A-rating, a B-rating with an action plan, restrictions on certificates, or revocation. The decision takes effect from the date of the letter.
5. If the licence is revoked, any certificates already assigned become invalid and unused entry clearance visas are cancelled. The Home Office writes to your sponsored workers but does not tell them the reasons.
6. The licence is reinstated without a court claim only if it was revoked in error. Otherwise, the options are judicial review, or a new application after the cooling-off period.

Effect on sponsored workers

Workers who were not involved in the breach normally have their permission shortened so that 60 calendar days remain. If they already have 60 days or less, it is not normally shortened further. In that time they can apply with a new licensed sponsor, switch to another route, or leave. Workers the Home Office believes were complicit, for example in a sham job, lose their permission altogether. Care workers already sponsored in that role can move to another licensed care provider.

Challenging a revocation

The only legal challenge is a claim for judicial review in the High Court. The court does not decide the case again. It asks whether the Home Office acted lawfully, rationally and fairly: for example, whether it followed its own guidance, put the allegations to you, and properly considered your evidence.

Before issuing a claim, you normally send a letter before claim under the pre-action protocol, and the Home Office is expected to reply within 14 days. The claim itself must be filed promptly and in any event within 3 months of the decision. The protocol does not extend that time. In very urgent cases, the claim can be issued straight away.

Costs

The main Home Office cost at this stage is the action plan fee, shown live on this page, which you pay if you are downgraded and again if a second action plan is needed. A judicial review claim involves court fees, and if it fails you may be ordered to pay part of the Home Office's legal costs. The commercial cost is often larger: losing sponsored staff, and being unable to sponsor anyone for at least a year. We give you a fixed fee for the work before we start; see services and fees.

Timescales

The cooling-off period can be longer after some civil penalties or criminal convictions. Surrendering the licence during compliance action does not avoid it: the period then runs from when the surrender is accepted.

Common problems

• Replying late, or without evidence. Representations that simply deny the allegations rarely succeed. Each point needs documents: payslips, timesheets, job descriptions, SMS records.
• Admitting breaches without context. Accepting a mistake can be right, but explain how it happened and what you have changed.
• Continuing to recruit while B-rated. Using a certificate for a new worker will lead to revocation.
• Surrendering to avoid revocation. It does not avoid the cooling-off period, and the workers still lose their sponsor.
• Waiting too long for judicial review. The 3-month limit is a long stop; delay within it can also count against you.
• Forgetting the workers. Sponsored staff need to know where they stand, and they may need their own advice quickly.

How we can help

Send us the Home Office letter as soon as it arrives. We compare the allegations with the guidance and your records, identify what can be answered and what needs putting right, and prepare detailed written representations with an indexed bundle of evidence within the 20-working-day deadline.

If you are downgraded, we help you work through the action plan and prepare for the follow-up check. If the licence is revoked, we advise on whether judicial review is realistic, send the pre-action letter, and work with counsel on any claim. Once the cooling-off period ends, we can help you prepare a new sponsor licence application. Where there is no conflict of interest, we can also advise affected workers on their options.

Frequently asked questions

Can we appeal against a revocation?

No. There is no right of appeal. The Home Office will reinstate a licence only if it was revoked in error; otherwise the legal route is judicial review.

Can our sponsored workers keep working while the licence is suspended?

Yes. Workers with valid permission are not affected unless and until the licence is revoked. But you cannot assign new certificates, and some of their pending applications will be held.

Will our workers be told why the licence was revoked?

They are told that the licence has been revoked and what it means for their permission, but not the reasons.

Should we surrender the licence before a decision is made?

Rarely. If you surrender during compliance action, the 12-month cooling-off period still applies, from the date the surrender is accepted, and the workers still lose their sponsor. Take advice first.

Can the Home Office revoke without warning?

Yes, for some Annex C1 grounds, such as a sham role or a relevant criminal conviction. In most cases, though, the licence is suspended first and you have the chance to respond.