Navigating Increased Immigration Compliance Risks in the Hospitality Industry

Due to the 2025 Immigration White Paper, the UK hospitality sector is being scrutinised and demanded to raise skill requirements and salary thresholds for overseas workers. Hospitality businesses in the UK were already struggling with labour shortages. Now, these new restrictions make it more challenging for many employers to sponsor overseas workers in hospitality roles, particularly those that no longer meet the revised skill and salary thresholds. This could worsen staffing gaps and force some to reduce hours or services. Amidst these challenges, businesses in this industry are looking for practical solutions, which is why we are here.

This blog will discuss these immigration challenges and how employers can ensure compliance and reduce the risks of penalties and business disruption. Read on to learn about how experienced immigration advisors in UK (like us) can help you navigate these challenges.

Why Does the Hospitality Sector Face More Compliance Pressure?

Due to stricter laws and immigration control, the UK hospitality sector faces more compliance pressure when employing overseas workers. Building on the post-Brexit system, the 2025 immigration reforms have intensified compliance demands, especially through revised salary and skill thresholds.

These pressures have intensified following the 2025 Immigration White Paper, which introduced raised salary and skill thresholds under the Skilled Worker route, excluding many frontline hospitality roles from sponsorship eligibility.

For the roles that allow sponsoring foreign talents, employers must now obtain a sponsor licence, demonstrate genuine business operations, and implement robust HR systems to manage sponsorship duties and prevent illegal working. Failing to meet these requirements can result in significant penalties. These changes make compliance more complex and costly, compelling hospitality businesses to ensure rigorous checks and documentation for sponsoring overseas workers.

Rising Penalties and What They Mean

The UK government has adopted a zero-tolerance approach to illegal employment. Employers failing to meet the latest regulatory requirements risk facing consequences such as hefty fines. Below, we have mentioned how these penalties can affect employers in the hospitality industry:

Financial Losses

The UK government has raised civil penalties to £45,000 per illegal worker for a first offence and £60,000 for repeat offences. These fines apply per illegal worker, meaning a single incident involving multiple staff can quickly lead to penalties in the six-figure range, posing a direct financial threat to employers. Additionally, increased compliance costs, such as investing in robust HR systems and regular audits, have increased their financial burden.

Licence Revocation

Employers guilty of repeated violations can face suspension or revocation of their sponsor licence. It may even bar them from employing overseas workers for at least two years. Losing this licence can be catastrophic for sectors like hospitality, where access to international talent is crucial for operations and growth.

Reputational Damage

Beyond monetary losses, businesses caught employing illegal workers risk public naming and shaming by Immigration Enforcement. This negative publicity can erode customer trust, deter future talent, and damage relationships with business partners. It can be difficult to recover once a company’s reputation is tarnished.

These rising penalties mean UK employers must treat immigration compliance as a core business risk. Financial penalties, loss of recruitment privileges, and reputational harm combine to make rigorous right-to-work checks and ongoing compliance essential for any business employing overseas workers.

Key Regulatory Changes Employers Must Know

The UK hospitality industry has seen significant regulatory changes regarding immigration compliance, particularly following the Immigration Act 2016 and its amendments to the Licensing Act 2003. These changes have introduced new requirements and enforcement powers directly affecting hospitality businesses' operations.

Key Regulatory Changes:

1. Entitlement to Work Checks

Applicants for personal and premises licences must now provide evidence of their right to work in the UK. This includes supplying documentation of their immigration status, nationality, and date of birth when applying for or transferring a licence.

If a licence holder loses their right to work in the UK, their licence lapses immediately unless action is taken within 28 days.

2. Secretary of State as a Responsible Authority

The Secretary of State for the Home Department (SSHD), represented by the Home Office’s Immigration Enforcement division, is now a “Responsible Authority” under the Licensing Act 2003.

This status allows Immigration Enforcement to be consulted on all relevant licensing applications, transfers, and reviews, and to make representations or objections based on immigration concerns.

3. Immigration Offences as Grounds for Licensing Action

Licensing authorities must consider immigration offences or civil penalties when assessing licence applications or reviews. Any history of illegal working or immigration breaches can lead to the refusal, suspension, or revocation of a licence.

4. Powers of Entry for Immigration Officers

Under Section 179 (1A) of the Licensing Act 2003, immigration officers have similar powers of entry to police or licensing officers, but specifically for investigating immigration offences related to licensable activities.

Entry must be based on a reasonable belief that licensable activities are taking place and that immigration offences may occur in connection with those activities.

5. Increased Enforcement and Penalties

The Home Office has increased the frequency of immigration audits and enforcement visits, particularly in the hospitality sector, which is considered high-risk for illegal working.

Civil penalties for employing individuals without the right to work have risen sharply, with fines increasing from £20,000 to £60,000. Non-compliance can result in severe consequences, including substantial fines, potential temporary closure under enforcement powers, and criminal prosecution in serious cases..

These regulatory changes mean employers must maintain robust sponsor licence compliance processes, as breaches can trigger immediate enforcement action, licence loss, and significant penalties.

What Hospitality Businesses Must Do Now

To ensure compliance and avoid severe penalties under the UK's evolving immigration regulations, hospitality businesses must take proactive and structured action. Here are the essential steps they must take:

Regular Audits

Employers must conduct internal audits to identify and address compliance gaps in hiring practices and immigration documentation. These audits should review recruitment processes, right-to-work checks, onboarding, and ongoing monitoring of employee status. With regular audits, employers can uncover potential issues before they escalate and demonstrate a commitment to compliance if scrutinised by authorities.

Staff Training

Employers should invest in comprehensive immigration compliance training for all staff involved in recruitment and HR. This training should cover the latest legal requirements, document verification, and the consequences of not maintaining sponsor licence compliance. It can equip the teams to spot fraudulent documents, understand sponsor licence duties, and maintain accurate records, thereby reducing the risk of costly mistakes.

Legal Consultation

Employers should also engage with immigration specialists or legal advisors to stay updated on the latest sponsor licence requirements and receive guidance tailored to their business needs. Legal experts can help interpret new rules, advise on complex cases, and ensure that the policies and procedures align with Home Office expectations. This support can be greatly beneficial as immigration laws continue to evolve rapidly.

Documentation Management

Employers must now maintain current and accurate records for every employee, including their right to work, visa expiry dates, and other sponsorship-related obligations. They must implement robust systems for tracking and securely storing documentation. Accurate records can allow employers to keep their sponsor licence active and their company safe during audits or investigations by the Home Office.

By adopting these practices, hospitality businesses can strengthen their compliance posture, minimise risk, and safeguard their ability to employ overseas workers even in challenging regulatory environments.

Importance of Legal Guidance

Due to the stricter noncompliance-related penalties, legal guidance has become more necessary than ever for UK hospitality businesses. Experienced Immigration advisors in the UK (like us) stay abreast of the latest regulations and can help companies to interpret the complex new regulations and maintain compliance.

Immigration advisors offer businesses the advice they need on immigration matters. They perform tasks such as reviewing for compliance, checking employment statuses accurately, and providing guidance on visa and sponsor licence applications.

Immigration advisors guide companies on what types of jobs they are allowed to sponsor, how to modify position requirements to meet new laws and prepare them for future recruitment. As a result of their advice, businesses in the hospitality field can successfully shift their operations and recruit staff according to recent changes in immigration laws.

With increased scrutiny from the Home Office, even minor compliance failures can lead to sponsor licence suspension or revocation, which can severely disrupt business operations. Immigration advisors enable hospitality businesses to deal with regulatory changes confidently, minimise risks of noncompliance and employ overseas workers even amidst the current immigration challenges.

Final Thoughts

The hospitality sector must carefully navigate the complex landscape of immigration compliance amidst increasing regulatory scrutiny. Immigration advisors in the UK can significantly help businesses in this sector since they help businesses understand the implications of recent changes, which can protect them from severe penalties and ensure their continued success in a competitive environment.

Frequently Asked Questions (FAQs) on UK Immigration Compliance

1. What constitutes a breach of immigration laws in the UK?

A breach of UK immigration laws can include overstaying your visa, entering the UK illegally, working without proper authorisation, committing criminal offences or violating the immigration rules of another country. Any breaches of immigration laws can result in deportation, refusal of entry, or bans on future applications.

2. How can I maintain compliance with UK immigration regulations as an employer?

To maintain compliance with UK immigration regulations as an employer, you must understand your responsibilities as a sponsor. This includes ensuring all sponsored workers have the right to work, keeping accurate records and reporting any changes to the UKVI.

3. What is the current UK policy on immigration?

The UK’s immigration policy is focused on reducing reliance on overseas recruitment, prioritising migrants who contribute to the economy and extending the qualifying period for settlement from five to ten years for most migrants, thereby significantly limiting automatic routes to Indefinite Leave to Remain.

4. How do you resolve compliance issues with UK immigration rules?

To resolve compliance issues promptly, you must seek legal advice, address any breaches by regularising your status, and submit all required documentation to the Home Office.

Get Experienced Immigration Advisors in UK at UK Visas

We are a team of IAA-regulated Level 1 immigration advisors here at UK Visas. Our team helps businesses across various industries, including those in the hospitality sector, understand & comply with the latest immigration regulations and sponsor licence responsibilities.

Laura Charge

Laura, is a Level 1 IAA acccredited adviser with over 20 years experience of working within the Home Office and the UK Immigration Service. She brings a unique advantage to our team. Her expertise in Immigration law and writing skills are an asset.