The importance of sponsorship visas when dealing with Mergers and Acquisitions

The importance of sponsorship visas when dealing with Mergers and Acquisitions

In recent years, there has been an increase in the regulation regarding migrant workers, as well as a general rise in visa sponsorships. Following the pandemic, the demand and availability of skilled migrant workers will only grow.

While it is essential that companies follow the correct procedure when filing a skilled sponsorship visa, it may go under the radar during acquisition proceedings.

What is the process?

Although there are several types of visa sponsorships, which vary depending on the worker to be employed, the most common is the Skilled Worker Sponsorship Visa.

A company who hires skilled migrant workers, or acquires them under a TUPE transfer, will need a Sponsorship License.

Once the license has been obtained, each individual skilled migrant worker will require a Certificate of Sponsorship (CoS) from the sponsor.

If the worker will also be studying, they will need an ATAS (Academic Technology Approval Scheme) certificate in addition to the CoS.

Depending on whether the worker is entering the UK job market for the first time, or already has a certificate under a former employer, the worker's certificate will be defined or undefined. In the event of a transfer arising from an acquisition, the certificates are likely to be undefined.

Your responsibilities as an employer

If you are hiring or inheriting migrant workers, you have a duty to ensure compliance. Not doing so will put you at risk of substantial penalties.

Care must be taken to confirm that the skilled migrant worker has the necessary skills and qualifications for the role and that the worker is complying with their visa.

Why you need to be aware of the sponsorship process

If you are in the process of going through an acquisition or merger, the transfer of employees will need to be at the forefront of considerations. If there is an acquisition or merger, or any change to a worker's situation and employer, this must be reported within 10 days of the change. If acquiring company, a license must be obtained within 20 days of acquisition.

Notice must be given, and the proper license obtained, if acquiring skilled migrant workers through an asset sale. In a share sale, the vendor should provide level-1 access to the current Sponsorship Management System (SMS). The selling company should already have a license for the purchasing company to inherit; the buyer will then need to record the change.

Failure to comply with the correct procedure could result in serious sanctions.

At GS Verde Law, we can assist you through the process of acquiring a sponsorship visa or granting a certificate to a skilled migrant worker - whether it be through a merger or acquisition, or if you are simply looking to hire.

If you have any queries about this, or another other employment or HR matter, please do not hesitate to contact our Employment and HR Team;
Simon Pathé
Head of Employment
+44 330 107 8498 ext. 336

For a no-obligation quote, use our online 'Get a Quote' service here.