Sponsor license updates: the 3 September 2026 changes explained

1. Multi-Factor Authentication (MFA)

Multi-Factor Authentication (MFA) will become mandatory for all Level 1 Users accessing the Sponsor Management System (SMS). It will be rolled out from 3 September 2026 and is aimed to help avoid cyber scams.

Upon logging into the SMS, a Level 1 User will receive a time-sensitive text message containing a code. If the user's mobile number has not been updated, the code should be sent via email instead. In line with sponsor obligations, all Level 1 Users should now verify that their details are correct, with particular attention to their email address, mobile phone number and date of birth.

Failure to update these details may be considered non-compliance by the Home Office and could result in access issues.

Reminder: SMS credentials, including MFA codes, must not be shared with anyone and are for the approved Level 1 User's sole use. Sharing these details is considered a discretionary ground for revoking a sponsor licence.

2. Phasing out of Level 2 User Role

From 9 September 2026, it will no longer be possible to appoint new Level 2 Users. Currently, Level 2 Users have restricted permissions and functionality compared to Level 1 Users on the SMS.

All Level 2 User accounts will be deactivated by 8 March 2027, so Sponsors should take the following steps:

• Review who has access as Level 1 and Level 2 Users and remove any inactive accounts.

• Consider whether to upgrade any Level 2 Users to Level 1 Users.

Important: Take particular care if you currently have agency staff listed as Level 2 Users or if your HR functions, including SMS access, are outsourced.

3. Home Office management of Inactive SMS Users

SMS Users should already ensure that they regularly access the SMS. This includes checking that user details and organisational information remains accurate, reviewing updates on the SMS homepage, and staying up-to-date with reporting duties.

Reminder: It is a sponsor duty to stay up-to-date with the sponsor guidance, and accessing the SMS regularly helps fulfil this obligation. We recommend logging in at least once a month.

Where the Home Office identifies an account as inactive for 12 months or more, the sponsor guidance states that the Authorising Officer will be contacted to remind them of the need for regular activity or the User will be deactivated.

If no Level 1 Users remain active, the sponsor licence will be suspended for 28 days and revoked if no new Level 1 User is nominated within this period. A revoked licence will likely result in the curtailment of leave for any existing sponsored workers.

To sponsor workers again, a new licence will need to be obtained.

4. Home Office management of Inactive Sponsor Licences

Part 3 of the sponsor guidance has been retitled from "How to renew your licence" to "Inactive sponsor licences."

Further guidance is expected to be published by the Home Office for situations where a sponsor licence is held but not actively used. Keep an eye out for further updates on this.

5. Extension of Right to Work scheme

From 1 October 2026, the duty to carry out right-to-work checks will expand as the definition of "employer" broadens.

The Sponsor Guidance has been updated to reflect this, making it clear that sponsors must ensure that they have robust processes in place for conducting right to work checks on everyone engaged under the expanded definition of employer (irrespective of whether or not they are sponsored), and everybody who is sponsored under the sponsor licence (irrespective of whether their engagement meets the expanded definition of employment).

For more detail on the expansion of the right to work regime, please see our article here. One of the key changes is the introduction of extended liability, which may necessitate new clauses in your commercial contracts and/or amendments to existing agreements.

Our summary: your next steps

These updates emphasise the importance of proactively managing your SMS account and sponsor licence. By staying informed and ensuring compliance, you can mitigate unnecessary risks to your sponsor status and maintain smooth operations.

If you haven’t already, now is the time to review your SMS account and consider the following:

• Are your Level 1 Users’ details correct, or do they need updating?

• Do your Level 1 and Level 2 Users have their current email addresses and mobile phone numbers listed?

• Do you need to ‘convert’ Level 2 Users to Level 1 Users?

• Are suitable individuals designated as Level 1 Users?

• Do you need to remove any Level 1 or Level 2 Users?

• Does your Key Contact or Authorising Officer require Level 1 User access?

• Are your Level 1 Users up-to-date with the guidance?

• Are your Level 1 Users regularly signing in and monitoring the SMS?

• Are you prepared for the extended scope of Right to Work checks coming into force on 1 October 2026?

VWV's immigration team offers a licence maintenance and management retainer service which can help you ensure that your licence is kept up-to-date, and also that you are aware of relevant changes to immigration law and policy as they are announced.

For more information about the retainer, if you need assistance with any of the above changes, or have other questions about your sponsor licence, or any other immigration issue, please reach out to the Immigration team. We would be happy to discuss how we can best support you.