Geocare Services Limited, R (on the application of) v Secretary of State for Home Department

A sponsor licence may be revoked under Annex C1(aa) where sponsored workers are paid less than the salary stated on their certificates of sponsorship, the reduction is not notified, or is not permitted by the Immigration Rules or sponsor guidance. The provision is not limited to cases involving exploitation or deception.

The Secretary of State retains a residual discretion, but a duty to consider downgrading or an action plan arises more clearly for Annex C2 or C3 breaches. The court’s supervisory role is limited, and the Secretary of State is entitled to respect the guidance’s salary requirements and the scheme’s emphasis on strict compliance.

The claimant, a domiciliary care provider employing sponsored skilled workers, challenged the immediate revocation of its sponsor licence following HMRC information and payslips showing that two sponsored workers had been paid less than the salaries stated on their certificates of sponsorship.

The claimant sought permission for judicial review and interim relief requiring suspension of the licence pending determination. It argued that the Secretary of State had fettered her discretion, failed to consider material matters, and misinterpreted the salary-reduction provisions in the sponsor guidance. The central issues were whether the conduct fell under Annex C1(aa), whether relevant impacts and mitigation had been ignored, and whether reduced hours could avoid a finding of salary underpayment.

1. Permission and interim relief. Permission was refused because none of the proposed grounds had a realistic prospect of success. Interim relief therefore could not be granted.
2. Ground 1. The conduct fell within Annex C1(aa), rather than Annex C2. The workers had been paid less than the salaries stated on their certificates of sponsorship, the reductions had not been notified, and the guidance did not permit them. Annex C1(aa) is not confined to serious exploitation or deception. It also protects the requirement that sponsored workers are paid in accordance with the scheme.
3. The Secretary of State retained a residual discretion to take action short of revocation. However, the guidance did not make consideration of downgrading inevitable in an Annex C1 case. The decision expressly considered downgrading and an action plan, but rejected them because the non-compliance was serious. The claimant had also relied on C8.1 without addressing C8.2, which states that downgrading is generally reserved for relatively minor breaches.
4. Ground 2. The Secretary of State was required to consider matters expressly or impliedly identified by the legal framework, or matters so obviously material that ignoring them would be irrational: R (Friends of the Earth Limited and Others) v Heathrow Airport Limited. The decision engaged with the information and representations supplied before the decision, including the reasons for reduced pay and the impact on the business. Later evidence could not establish a failure to consider matters that were unavailable when the decision was made. There was no arguable irrationality.
5. Ground 3. The scheme required payment of the salary stated on the certificate of sponsorship, together with the applicable general salary threshold and going rate, subject to the stated exceptions. If a worker did not work sufficient hours to meet the requirements and no exception applied, the sponsor should cease sponsorship. The argument that a breach required a threat to immigration control was unsupported. The claim was dismissed and no interim relief was granted.