UK immigration: Considerations when reorganising

Question

Points to note

What corporate changes must be reported to the UK Visas and Immigration service?

Changes that must be reported include:

• changing the company’s name or that of any branches
• selling all or any part of the business
• a merger or takeover
• ceasing trading or going into an insolvency procedure
• substantial changes to the nature of the business, including formation of new corporate organisations within the company structure

Within what timescale should the report be made and how?

The report must be made within 20 working days of any significant change. In most cases, notification of the change should be submitted through the Sponsor Management System, together with certain evidence of the relevant change.

What are the sanctions for failure to report?

Failure to report a significant change could result in a sponsorship license being downgraded or revoked, with potentially significant impact on an organisation’s people resource. 

Is there an obligation to report TUPE (or similar protection) transfers to the UK Visas and Immigration service?

Yes. When a business changes owner or another business takes over part of it or a service it provides, its employees may be protected under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (as amended) (‘TUPE’). If a sponsored worker’s employment is affected by TUPE or similar protection, a report must be made within 10 working days of that event.

What is the position regarding sponsorship licences when receiving new staff as a result of a TUPE transfer?

Sponsorship licences do not transfer with the ownership of a company. It will be important therefore for a new employer following a TUPE transfer to consider whether it has an appropriate licence. Workers do not need to make a new application for permission to stay in the UK and the new employer does not have to assign a new Certificate of Sponsorship to the workers, provided:

• the employer has a valid sponsorship licence in the relevant route
• the employer has confirmed that it accepts responsibility for the workers
• the workers’ duties remain unchanged

In this case, the new employer takes up full responsibility for the workers and must meet all of the duties.  

What is the position if the employer receiving new staff as a result of a TUPE transfer does not have a relevant sponsorship licence?

Where the new employer does not already have a relevant sponsorship licence under the route needed to sponsor workers, an application for such a licence must be made be made within 20 working days of the transfer taking place.

What is the risk if an employer receiving new staff as a result of a TUPE transfer fails to complete right to work checks?

Should right to work checks not be made on employees who transfer to an organisation, the new employer will become liable for any breaches of immigration law after 60 days of employment. It is therefore necessary to ensure that appropriate checks are made, even if a record of previous right to work checks has been presented by the previous employer and appears accurate.