The Home Office sponsor guidance has been updated to expressly prohibit employers passing on certain costs associated with a Skilled Worker visa to their sponsored employees.

While it has always been the case that the Immigration Skills Charge must be borne by the sponsoring employer, from 31 December 2024 the following costs cannot be recouped from employees sponsored as skilled workers:

• the sponsor licence application fee
• associated administrative costs of the sponsor licence

While the Home Office guidance does not specify the definition of ‘associated administrative costs of the sponsor licence’, we have received confirmation from the Home Office that administrative costs would include:

• any priority or premium service fee for the licence
• Certificate of Sponsorship (CoS) assignment fee
• priority CoS allocation fee
• action plan fees
• any other reasonable costs which are fundamentally linked to the administration of the sponsor licence including costs for legal services

These rules apply where the application for a sponsor licence, or a request to add the Skilled Worker sponsorship route to an existing sponsor licence, was made on or after 31 December 2024.

Should the Home Office find that such costs were recouped, or an attempt was made to recoup such costs, from the skilled worker or prospective skilled worker, this would constitute grounds for revocation of the sponsor licence. While such a finding may lead to a suspension or downgrade of the licence in the first instance, the Home Office can revoke the licence immediately without first downgrading or suspending the licence.

It should be noted that the prohibition of the passing-on of costs relates only to licencing matters and does not extend to the Skilled Worker visa application fee or legal fees for the preparation of the visa application, priority processing fee for visa applications, immigration health surcharge, or visa application centre fees.

Employers who claw back immigration costs from employees should check their claw back agreements to ensure only permitted costs are being recouped from sponsored employees.

For further information, please contact Tanya Goldfarb and Natalie Loader in our Business Immigration team.

This article does not constitute legal advice and is provided for informational purposes only. It is not to be relied upon as legal advice.