Care Home Loses Challenge Against Sponsor Licence Revocation Over Staff Underpayment
Case Overview
The case is R (Geocare Services Ltd) v Secretary of State for the Home Department [2025] EWHC 3446 (Admin). Permission for judicial review and interim relief was refused by the High Court on 20 January 2026. The care home had sought to overturn or delay the Home Office’s decision to revoke its sponsor licence.
Reason for Revocation
The Home Office revoked the sponsor licence because it was satisfied that sponsored workers were being paid less than the minimum wage and less than the rates stated on their Certificates of Sponsorship (CoS). This determination was supported by HMRC data and employer payslip information.
Sponsor’s Explanation
The care home argued the underpayments occurred because employees were working fewer than contracted hours, and there were transportation deductions (with the sponsor covering most of the transport costs).
Home Office Position
The Home Office rejected the sponsor’s explanations, noting they did not satisfy the requirements of the relevant immigration guidance (S4.31) and that changes were not notified through the Sponsorship Management System.
Court’s Decision
The High Court refused permission both to proceed with a full judicial review and to grant interim relief.
The court held that the alleged compliance breaches fell within Annex C1 of the sponsor guidance (“Circumstances in which we will revoke your licence”), which provides for mandatory revocation in clear cases of serious non-compliance.
The sponsor’s arguments, including that the breach should not lead to revocation when workers worked fewer hours but were paid at the appropriate hourly rate, were dismissed by the court.
Key Implications
Mandatory Revocation: Where the Home Office determines that a sponsor is paying below the minimum wage or below the rate specified on the CoS without proper notification or justification, the guidance supports mandatory revocation.
Limited Grounds to Challenge: The courts may refuse permission to judicially review such revocations where the facts fall squarely within the published guidance and the sponsor cannot show procedural illegality.
Compliance is Critical: This underlines the need for sponsors in the care sector and other industries to maintain rigorous compliance with UK employment and immigration requirements, including accurate payroll records and timely notifications to the Home Office.
1. Comply Fully with Sponsor Duties
a. Understand Your Core Duties
You must follow all reporting, record-keeping, and immigration compliance duties set out in the Workers and Temporary Workers guidance. These include:
Reporting changes in worker circumstances (e.g., salary, job role changes, absences) within 10 working days.
Reporting organisational changes (e.g., change of name, ownership, address) within 20 working days.
Reporting suspicion of worker breaches of visa conditions promptly.
Failure to comply can trigger enforcement actions up to revocation.
Action Steps
Adopt a reporting calendar with key deadlines.
Assign clear responsibilities within your HR team for meeting Home Office reporting requirements.
2. Maintain Accurate and Accessible Records
You are required to keep thorough records for each sponsored worker, including:
Right-to-work checks and identity documents.
Job descriptions and salary details.
Payslips and evidence of compliance with UK employment law.
Records must be ready for a Home Office compliance visit at any time.
Action Steps
• Use a central HR system to store and back up all documentation.
• Audit records regularly (at least quarterly) to ensure completeness and accuracy.
3. Ensure Transparent and Legal Pay Practices
Under UK law and Home Office guidance you must:
Pay at or above the minimum wage and at least the rate stated on the Certificate of Sponsorship (CoS).
Not recoup sponsorship fees, licence costs, or CoS fees from the worker. This includes administrative costs related to sponsorship.
Action Steps
Review employment contracts and payslips to confirm pay rates and hours.
Ensure payroll systems flag any underpayments immediately for correction.
4. Do Not Pass Sponsorship Costs to Workers
Home Office rules now prohibit passing sponsor licence costs, CoS costs, or associated administrative fees to sponsored workers. If recouped, this is grounds for licence revocation.
Action Steps
Review contracts and recruitment practices to ensure no deductions or reimbursement clauses cover any part of sponsorship costs.
Update employment policies to clarify who bears immigration-related expenses.
5. Report Material Changes Promptly
Any changes that affect sponsored workers or your organisation must be reported timely:
Salary changes, significant alterations to job duties, restructuring, long absences, and relocations.
Delays in reporting can trigger reviews and potential enforcement action.
Action Steps
Establish alerts or reminders in your HR system for all key reporting requirements.
Train HR users on exactly what changes trigger reporting duties.
6. Prepare for and Co-operate with Compliance Checks
The Home Office can conduct compliance visits or audits with or without notice. Non-cooperation or incomplete information can worsen your compliance position.
Action Steps
Conduct mock compliance visits internally.
Train relevant staff on what to expect and how to respond to Home Office compliance officers.
7. Monitor Employment Law Compliance
Sponsor compliance is not limited to immigration matters. You must also comply with wider UK employment law, including pay (minimum wage), working time, and statutory entitlements. Any breach that crosses into immigration duty relevance can affect your licence standing.
Action Steps
Schedule periodic reviews with an employment law advisor.
Correct any employment right gaps immediately.
8. Avoid Assigning Non-Genuine or Ineligible Roles
Certificates of Sponsorship must reflect real, substantive roles that the worker will perform. Mis-matching job duties or issuing certificates without a genuine role can risk compliance failures.
Action Steps
Ensure job descriptions accurately reflect the role and align to SOC codes.
Document recruitment processes and evidence of genuine vacancy needs.
9. Implement a Compliance Governance Framework
Organise your compliance responsibilities formally:
Appoint accountable Level 1 and Level 2 Users in your SMS.
Conduct regular internal audits.
Ensure ongoing training on UKVI requirements for HR and senior management.
Action Steps
Draft a compliance manual for sponsor duties.
Hold quarterly compliance reviews that include audit results.
10. Respond to Issues Rapidly
If you identify a compliance breach, take immediate corrective action and document your response. Early action can sometimes mitigate sanctions short of revocation.
Action Steps
Establish an incident response protocol for compliance breaches.
Communicate transparently with the Home Office where appropriate.
Summary
Maintaining a UK sponsor licence demands disciplined governance, rigorous HR processes, and proactive engagement with Home Office obligations. Key prevention measures include: clear reporting systems, robust record-keeping, paying workers correctly, not recouping sponsorship costs, audit readiness, and strong internal training and governance. Sponsors that fail to meet these standards risk licence suspension or revocation without appeal and face a minimum 12-month cooling-off period before reapplying.
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