Why this matters
Sponsors often ask whether Home Office auditors look only at sponsored workers or at the wider workforce. The distinction matters for how you prepare your records.
The primary focus
A sponsor licence audit primarily focuses on your sponsored workers. Auditors will review:
Right to work checks for each sponsored worker and employee.
Personnel files for sponsored workers.
Payslips evidencing the salary stated on the CoS.
Up to date contact details for each sponsored worker.
Evidence that you are meeting your sponsor duties (reporting, record-keeping, recruitment practices).
Wider workforce checks
Although the audit centres on sponsored workers, auditors can carry out broader right to work checks across your wider workforce during a visit. For this reason, you should ensure that right to work documentation is up to date and on file for every employee, sponsored or not.
Company legitimacy
The auditor is also likely to look at your business structure, incoming payments, and if you have valid grounds to sponsor workers. This includes confirming that the company is legit, is trading, there is income (other than from investors), and that there is no circular trading.
Preparation checklist
Right to work checks complete and on file for all staff.
Payslip evidence available for each sponsored worker covering the period since their CoS was assigned.
Personnel files for sponsored workers organised and accessible.
A current copy of each sponsored worker's contact details.
Records of changes of circumstance you have reported via the SMS, with dates.
Announced and unannounced visits
A compliance check is not always a site visit, and a site visit is not always booked in advance. The Home Office can ask for additional documents or information, verify documents, carry out a digital compliance check, visit your premises, and make checks with other government departments. Visits can be announced or unannounced, so the practical test is whether your records would stand up to a visit today, not one you have had two weeks to prepare for.
During a visit officers can verify the information given in your licence application and in your workers' applications, take photographs, speak to sponsored workers and to the people involved in recruiting them, inspect your records and systems, and run criminal record and civil penalty checks on directors, key personnel and associated people.
If any of your sponsored workers are based at a third party's premises, you must make sure that third party knows the Home Office may visit unannounced. If the third party does not cooperate, the Home Office takes action against you, not against them.
What happens if the visit finds problems
Three outcomes are possible, depending on how serious the breach is.
A B-rating and an action plan. For relatively minor breaches the Home Office downgrades your licence from A-rating to B-rating. You have 20 working days from the date of the letter to respond in writing. A B-rating comes with an action plan you have to pay for: the fee is £1,579, payable within 10 working days. The plan runs for 3 months, and while you are B-rated you cannot assign a CoS to sponsor any new worker. Meet the requirements and you return to A-rating. Fail to meet them within the 3 months and your licence is revoked.
You can be B-rated twice in any rolling 4 year period. A third downgrade in that period means revocation.
Suspension. Where the Home Office believes you are breaching your sponsor duties, pose a threat to immigration control, or are acting in a way that is not conducive to the public good, it can suspend the licence while it investigates. You remain a licensed sponsor, but you cannot assign any CoS and your entry is removed from the public register. Workers who already hold valid permission are unaffected unless the licence is then revoked. Every sponsor duty continues throughout.
Revocation. The most serious outcome. Sponsored workers' permission is cancelled and the Home Office writes to each of them curtailing their leave. You cannot re-apply for a licence for at least 12 months, or 24 months if you have had a licence revoked on more than one occasion. See What Happens When a Sponsor Licence Is Revoked for what this means for your workers.