Making redundancies is never simple, but when the employees you’re considering for redundancy hold sponsored visas, the process becomes considerably more difficult.
Sponsored workers have their immigration status tied directly to their employment with your business. This means that any changes to their employment, including redundancy, can have serious implications for their job and their right to remain in the UK.
Employers with a sponsor licence have legal obligations that go beyond standard employment laws. In this guide, we’ll walk you through everything you need to know about the process of redundancy for sponsored workers: from understanding your legal obligations and following a fair process to supporting affected employees through what can be an incredibly difficult time.
With the right approach and proper advice, you can handle redundancies correctly whilst protecting both your employees and your sponsor licence.
What Does It Mean to Sponsor a Worker?
When you sponsor an employee’s visa, you’re entering into a formal relationship that’s regulated by UK Visas and Immigration (UKVI). You’re essentially vouching for that individual, confirming that they have a genuine job with your organisation that meets specific requirements around skill level and salary.
The most common sponsored visa categories you’re likely to encounter are:
- Skilled Worker visa (and its predecessor, the Tier 2 General visa).
- Global Business Mobility: Senior or Specialist Worker (previously known as Intra-Company Transfer or Tier 2 ICT).
Unlike employees with indefinite leave to remain or British citizenship, sponsored workers’ immigration status is intrinsically linked to their job role and their employer. This means that if their employment ends, their visa can be affected.
On top of this, you have additional responsibilities to think about as the sponsor.
You’re required to maintain accurate records, report certain changes to UKVI, and ensure ongoing compliance with sponsor licence conditions. The Sponsor Management System (SMS) is your primary tool for managing these obligations, and it’s through this system that you’ll need to report if a sponsored worker’s employment ends, including through redundancy.
Understanding this relationship is important because it affects both how you approach redundancy and what happens to your employee afterwards.
Can You Make a Sponsored Worker Redundant?
The short answer is yes. Holding a sponsored visa does not protect an employee from redundancy, nor does it give them any additional employment rights beyond those afforded to other workers.
Sponsored workers are employees first and foremost. They have the same statutory rights and protections as any other member of your workforce. This means they’re entitled to fair treatment, proper consultation, notice periods, and redundancy pay where applicable.
However, whilst you can make sponsored workers redundant, you absolutely must ensure that the process is fair and non-discriminatory. You cannot treat sponsored workers more favourably or less favourably than other employees in comparable roles. Doing so could expose you to discrimination claims and potentially jeopardise your sponsor licence.
The key difference lies not in whether you can make them redundant, but in what you must do during and after the process. There are immigration regulations that sit alongside your employment law duties, and both must be fulfilled correctly.
Following a Fair Redundancy Process
When it comes to the redundancy process itself, sponsored workers must be included in your selection pool on exactly the same basis as everyone else. Your selection criteria must be objective and applied consistently across the board.
A fair redundancy process typically involves:
A genuine redundancy situation: You must have a legitimate business reason for the redundancies, whether that’s the closure of the business, workplace closure, reduced need for employees to do particular work, or reduced need for employees overall.
Fair and objective selection criteria: These might include factors like skills, qualifications, performance records, or length of service. Immigration status cannot be a factor; you cannot select someone for redundancy simply because they hold a sponsored visa or because keeping them employed involves more administrative work.
Meaningful consultation: You must consult with affected employees, explain the situation, discuss the selection criteria, and genuinely consider any representations they make. For sponsored workers, this consultation should also include clear information about the implications of redundancy on their immigration status.
Consideration of suitable alternative employment: Before confirming redundancies, you must consider whether there are suitable alternative roles available within the business. This is where things get more complicated for sponsored workers, as we’ll explore in the next section.
Proper notice and redundancy pay: Sponsored workers are entitled to their full contractual or statutory notice period and any statutory redundancy pay they’ve accrued, just like any other employee.
Documentation is a crucial part of this process. Keep detailed records of your consultation meetings and the rationale for all of the decisions youโve made. This protects you not only against potential employment tribunal claims but also demonstrates to UKVI that you’ve acted fairly and in compliance with your sponsor duties.
Remember: any suggestion that you’ve discriminated against or unfairly favoured sponsored workers could result in legal claims and impact the status of your sponsor licence. Treat everyone equally and fairly.
Finding Alternative Roles for Sponsored Workers
One of the most significant complications when making sponsored workers redundant is the question of alternative roles.
In a standard redundancy situation, if you have a suitable alternative role available, you would typically offer it to the employee at risk. If they unreasonably refuse a suitable alternative, they may lose their right to redundancy pay.
With sponsored workers, it’s not that simple.
Unlike employees with unrestricted work rights, a sponsored worker cannot simply transfer into a different role within your organisation. Their visa is specifically tied to the job described in their Certificate of Sponsorship (CoS). If you want to offer them a different role, there are several requirements that you must consider:
The new role must meet sponsorship requirements: It must be on the eligible occupation list, meet the minimum skill level (typically RQF Level 6 or above for Skilled Worker visas), and satisfy the relevant salary thresholds. Not all roles within your business will qualify.
You may need to assign a new Certificate of Sponsorship: If the new role is substantially different from their current position, you’ll need to assign a new CoS.
The employee would need to apply for a new visa: In most cases, the employee would need to make a fresh visa application.
These complications mean that what appears to be a suitable alternative role in employment law terms may not be practically viable when immigration requirements are factored in.
When assessing alternative employment for sponsored workers, be realistic about these constraints. Consider:
- Would the new role genuinely meet sponsorship requirements?
- What would the costs be (CoS, visa fees, legal advice)?
- How long would the process take, and can the business wait?
Your Reporting Obligations
When a sponsored worker’s employment ends, you must report this change to UK Visas and Immigration.
This is a legal requirement under your sponsor licence conditions. You must report the change via the Sponsor Management System no later than 10 working days after the employment has ended. This deadline is strict, and failing to meet it can have serious consequences.
What you need to report:
- The fact that the employee’s employment has ceased
- The date their employment ended
- The reason (in this case, redundancy)
Once you’ve reported the change, UKVI will typically curtail the employee’s visa. The employee will usually be given 60 days from the date you report the change (or until their visa is due to expire, whichever is shorter) to either find a new sponsor and switch to a new visa or leave the UK.
What happens if you don’t report on time?
Failing to report changes to a sponsored worker’s employment is one of the most common compliance failures among sponsor licence holders. UKVI takes this seriously. Potential consequences include:
- Your sponsor licence being downgraded from an A-rating to a B-rating.
- Suspension of your ability to assign new Certificates of Sponsorship.
- In serious cases, revocation of your sponsor licence entirely.
Beyond the impact on your business, failing to report also affects the employee. If their visa isn’t curtailed because you haven’t reported the change, they may not realise that their immigration status is actually in jeopardy.
The bottom line: reporting through the SMS isn’t optional, and it isn’t something you can delay. Build it into your redundancy process from the start, and make sure the person responsible for sponsor licence compliance in your organisation knows exactly when the employment will end so they can report it promptly.
Supporting Sponsored Workers Through Redundancy
Redundancy is stressful for anyone. For sponsored workers, that stress is compounded by the possibility that they may need to uproot their lives and leave the UK.
Whilst you must treat sponsored workers the same as other employees in terms of selection and process, there are ways you can support them through this difficult period that acknowledge the challenges they face:
Communicate early and clearly: As soon as redundancy is a possibility, make sure sponsored workers understand the implications that this will have on their immigration status. Explain the 60-day curtailment period and what it may mean for them.
Provide information in writing: Give them written information about their visa status, when you’ll be reporting to UKVI, and the likely date their visa will be curtailed. This helps them plan and seek appropriate advice.
Be generous with notice where possible: If you can offer longer notice periods than the statutory minimum, this gives sponsored workers more time to search for new opportunities before their visa is curtailed.
Offer strong references: A good reference can be the difference between securing new employment and having to leave the UK. Be as supportive as you can be within the bounds of honesty.
Consider outplacement support: If your budget allows, outplacement services can help affected employees navigate the job market. Some providers even specialise in helping sponsored workers find new sponsors.
Allow flexibility for job searching: Sponsored workers may need time off for interviews or to seek immigration advice. Where possible, be accommodating.
Recommend immigration advice: Encourage affected employees to seek specialist immigration advice as soon as possible. They may have options you’re not aware of, such as switching to a different visa category.
Maintain compassion: Remember that for many sponsored workers, redundancy potentially means leaving friends, uprooting families, taking children out of schools, and saying goodbye to the life they’ve built in the UK. Whilst you can’t change the outcome, you can treat them with dignity and kindness.
Common Pitfalls to Avoid
Over the years, we’ve seen employers make the same mistakes repeatedly when handling redundancies involving sponsored workers. Here are the most common pitfalls and how to avoid them:
Missing the reporting deadline: This is the number one compliance failure. Set reminders, allocate responsibility clearly, and build SMS reporting into your redundancy checklist. Don’t leave it until the last minute.
Treating sponsored workers differently: Whether it’s excluding them from redundancy because it seems “too complicated” or selecting them because you think it’ll be easier than dealing with British workers, any different treatment based on immigration status is discriminatory. Apply the same criteria to everyone.
Assuming alternative roles are easily transferable: Don’t promise a sponsored worker an alternative role without first checking whether it meets sponsorship requirements.
Poor communication about consequences: Failing to explain the immigration implications clearly can leave sponsored workers blindsided when their visa is curtailed. Be upfront from the start about what redundancy will mean for their right to remain in the UK.
Inadequate documentation: Keep thorough records throughout the redundancy process. This protects you if youโre challenged and demonstrates your compliance with both employment law and your sponsor licence obligations.
By being aware of these pitfalls, you can implement safeguards to avoid them.
When to Seek Legal Advice
Redundancies involving sponsored workers sit in the intersection of employment law and immigration law, which are two areas of the law that unfortunately donโt always mesh smoothly.
You should particularly consider seeking legal support if:
You’re planning large-scale redundancies that involve multiple sponsored workers.
You’re uncertain about whether alternative roles meet sponsorship requirements. Getting this wrong can be costly and complicated. It’s worth getting clarity before making offers.
You have questions about sponsor licence compliance. If you’re unsure about your reporting obligations or how to use the Sponsor Management System correctly, legal guidance can prevent serious compliance failures.
The sponsored worker is challenging the redundancy. If an employee claims the process was unfair or discriminatory, you need specialist representation to defend your position.
You’re juggling multiple legal obligations. If there are other complications, such as employees on maternity leave or employees with disabilities, specialist advice ensures you’re meeting all your obligations simultaneously.
At Tann Law, we regularly advise employers on the full spectrum of sponsor licence compliance and employment law matters.
Our expertise in both immigration and employment law means we can help you navigate redundancies involving sponsored workers correctly, protecting both your employees’ rights and your sponsor licence.
The Essential Points to Remember
Yes, you can make sponsored workers redundant, but you must get the process right.
Treat sponsored workers equally in your redundancy selection process, but acknowledge the additional complications that sponsorship creates when considering alternative employment.
Follow a fair and transparent process, document everything carefully, and above all, report changes to UKVI on time through the Sponsor Management System.
Remember too that behind every redundancy is a person facing genuine uncertainty and difficulty, and for sponsored workers, the stakes are particularly high. Whilst you can’t always change the outcome, you can handle the process thoughtfully and compassionately.
Getting redundancies wrong can be costly. If you’re facing redundancies involving sponsored workers, or if you simply want to ensure your processes are compliant, early legal advice can save you significant problems down the line.
Facing redundancies involving sponsored workers? Concerned about compliance with sponsorship licence requirements?
Tann Law’s employment and immigration law specialists can guide you through the process, ensuring you meet your legal obligations whilst treating your employees with fairness and respect.