Why Every Care Provider with a Sponsorship Licence Needs a Compliance Audit Right Now

Most care home managers don't find out they have a compliance problem until the Home Office is already at the door.

That's not a scare tactic. It's what actually happens. A provider hires someone years ago, the documentation seemed fine at the time, but the right-to-work check was done late, a salary slipped below the required threshold, or sponsored hours weren't being tracked properly. Everything looks normal from the inside. Then a letter arrives.

The care sector has been under increasing immigration scrutiny since 2022, when the government opened sponsorship to address a staffing crisis it then partially reversed in 2025. What that left behind is a landscape where roughly 40 to 50 percent of UK care providers hold sponsorship licences, many of which have never been properly audited against the Home Office's current standards.

That's a significant risk sitting unexamined in a lot of organisations.

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What is a sponsorship licence compliance audit?

A sponsorship licence compliance audit is a structured review of everything a care provider is responsible for under their sponsor licence obligations. It checks whether your organisation would pass a Home Office inspection if one arrived unannounced.

The audit typically covers:

‍Right-to-work checks: Were they done correctly, on time, and for the right document types? Late checks, even by a day, can constitute a breach.

‍Salary and hours compliance: Sponsored workers must be paid at least the rate stated on their Certificate of Sponsorship and must work a minimum number of hours over any 12-week period. If a rota change or unpaid leave drops someone below their required hours, that needs to be reported to the Home Office. Most providers don't realise this.

‍Reporting duties: Sponsors have an obligation to report certain changes to the Home Office within 10 working days. These include a worker not showing up on their first day, a worker's contract ending early, changes to job role or salary, or a worker going AWOL. Failure to report is one of the most common causes of licence downgrade or revocation.

‍Record-keeping: Every sponsored worker needs a complete, up-to-date file. That means copies of passports, Biometric Residence Permits, employment contracts, payslips, and contact details. The Home Office expects these to be accessible, organised, and current.

‍SMS access and Level 1 user responsibilities: Someone in your organisation is a Level 1 user on the Sponsorship Management System. If that person has left or their access isn't being used properly, that's a compliance gap.

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Why care providers are at higher risk than other sectors

The care sector has some compliance challenges that other sponsored industries don't face in the same way.

Staff turnover is high. When a sponsored worker leaves and another takes their role, the CoS obligations, right-to-work processes, and reporting duties all need to follow correctly. In a fast-moving environment, they often don't.

Many care providers are still running sponsored worker management through spreadsheets or paper files. That might have been acceptable in 2022 when the numbers were smaller. It is not acceptable now. The Home Office introduced a live data connection with HMRC in April 2026, which means they can now identify pay and hours discrepancies before your next audit visit, not during it.

Care businesses also frequently have administrators who handle immigration on top of other responsibilities. There is no dedicated immigration function. That person might know enough to issue a Certificate of Sponsorship, but they may not know that a sponsored worker taking three weeks of unpaid leave needs to be reported, or that the worker's contract changing from 40 to 37.5 hours a week has implications for their CoS conditions.

The Home Office knows this. Inspections in the care sector have increased substantially since 2023.

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What happens if you fail an audit

The consequences of a compliance failure depend on severity, but the range is significant.

A Sponsor Licence Suspension can be issued while the Home Office investigates. During a suspension, you cannot issue new Certificates of Sponsorship and you cannot hire new sponsored workers. For a care home that depends on its sponsored workforce, this is operationally catastrophic.

‍Licence downgrade from A-Rating to B-Rating means you are placed on a performance improvement plan. You pay for the privilege, your ability to sponsor is restricted, and you have a defined timeframe to fix the issues which now happen to be documented and on the Home Office's record.

‍Licence revocation means your licence is cancelled. Every worker currently sponsored by you has 60 days to find a new sponsor. You lose your entire sponsored workforce and cannot apply for a new licence for at least 12 months.

‍Civil penalties for employing someone without the right to work can reach £60,000 per worker under the increased rates introduced in 2024.

None of these outcomes announce themselves in advance. They follow from gaps that accumulate quietly while operations continue as normal.

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The most common compliance gaps we see in care

Based on working with over 500 UK care providers and reviewing more than 150 cases of licence revocation, these are the issues that come up most often:

‍Late right-to-work checks: Particularly for workers who joined during a busy period when HR processes were under pressure.

‍Salaries that have drifted below threshold: Minimum salary requirements have changed. If a sponsored worker was hired at the threshold rate in 2022 and hasn't had a pay increase, they may now be below the required level.

‍Unreported absences: Workers taking extended unpaid leave, going AWOL, or having their contract end early without the Home Office being notified within the required 10 working days.

‍Missing or incomplete worker files: Documents not updated when a BRP was renewed, contact details no longer current, gap in employment history not explained.

‍Incorrect CoS conditions: Workers being rostered across locations not listed on their Certificate of Sponsorship, or hours dropping below what was stated.

‍Sole corporate licence covering multiple sites: A single licence for multiple care home locations creates concentration risk. If the licence is revoked, every site loses its sponsored workers simultaneously.

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What a compliance audit looks like in practice

A thorough sponsorship licence compliance audit starts with your current SMS setup and works outward. The goal is to reach a position where, if the Home Office visited today, every file would be in order.

In practice, this means:

Pulling a full list of every sponsored worker currently on your licence and cross-referencing their CoS conditions against actual payslips, rosters, and hours records.

Reviewing every right-to-work check for date of completion relative to start date.

Checking whether all mandatory reporting obligations have been met in the past 12 months.

Reviewing all employment files for completeness and currency.

Identifying any workers whose visa expiry dates are approaching and ensuring renewal processes are underway.

Documenting the findings, prioritising by risk level, typically critical, high, medium, and low  and building a remediation plan with clear timelines.

A clean audit produces a record of your compliance position that can be used to demonstrate good faith if the Home Office does investigate. An audit that uncovers issues gives you the chance to fix them before someone else finds them first.

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When you should audit

If you haven't audited in the past 12 months, do it now.

If your sponsored workforce has grown significantly in the past two years, do it now.

If you've had staff turnover in the HR or administration team responsible for sponsorship, do it now.

If you've recently acquired another care business and inherited their licence, do it now.

If you've received any communication from the Home Office, even a routine letter, do it now.

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Frequently asked questions

How long does a sponsorship licence compliance audit take? For a provider with 20 to 50 sponsored workers, a thorough audit typically takes between two and four weeks, depending on how complete the existing records are.

‍Who should carry out the audit? An audit should be carried out by someone with current knowledge of Home Office sponsor guidance, ideally an IAA-regulated immigration adviser or a specialist workforce compliance platform with dedicated immigration expertise. Internal audits conducted by HR without specialist oversight frequently miss technical requirements.

‍What's the difference between an internal audit and a Home Office inspection? An internal audit is a proactive review you control. A Home Office inspection is reactive and adversarial. The goal of an internal audit is to find problems before the Home Office does.

‍Does an audit protect us from penalties? It doesn't guarantee immunity, but it demonstrates good faith and gives you the opportunity to self-correct. Providers who identify and remediate issues before a Home Office visit are in a materially better position than those who are found to be non-compliant during an unannounced inspection.

‍What if we find problems during the audit? Document everything and begin remediation immediately. In some cases, voluntary reporting to the Home Office of identified issues before they are found during inspection can influence how a case is handled. A specialist immigration adviser should guide that decision.

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The bottom line

A sponsorship licence is not a one-time administrative task. It is an ongoing legal obligation with real consequences for getting it wrong. The care sector's compliance burden has increased substantially as the Home Office has invested in enforcement capability and introduced real-time data connections with HMRC.

An audit is not a sign that something is wrong. It is how you make sure nothing goes wrong.

If you manage sponsored workers and haven't reviewed your compliance position in the last year, that review is overdue.

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