Landmark judgment establishes important procedural fairness requirements for sponsor licence holders
Case: TJ Trading Express Ltd v Secretary of State for the Home Department [2025] EWHC 1274 (Admin)
Judge: Mrs Justice Hill DBE
Date: 22 May 2025
📅 Published: June 25, 2025👤 By: Amit Kapadia ⏱️ Read Time: 12 minutes
A significant High Court judgment handed down in May 2025 has established crucial precedent regarding procedural fairness in sponsor licence revocations. The case of TJ Trading Express Ltd v Secretary of State for the Home Department [2025] EWHC 1274 (Admin) provides important clarity for sponsors facing potential licence revocation and reinforces the fundamental right to be heard before adverse decisions are made.
🎯 Key Takeaways from This Judgment:
- Sponsors must be given opportunity to make representations before licence revocation
- This applies even where “mandatory” grounds for revocation exist
- Home Office guidance must be interpreted in line with common law procedural fairness
- Insufficient reasoning in revocation decisions will be challenged successfully
Background to the Case
TJ Trading Express Limited operated a petrol station and convenience store in Brough, near Hull. The company obtained a skilled worker sponsor licence in September 2022, allowing them to sponsor foreign workers for their business. The director, Mr Jayaganth Ragunathan, was designated as the “Level 1 user” responsible for issuing Certificates of Sponsorship (CoS).
The problems began in November 2023 when Mr Ragunathan issued a CoS to Sukirthujan Sivalingam for the role of “Petrol Station Manager.” The Home Office subsequently discovered that Mr Sivalingam was Mr Ragunathan’s brother-in-law – a fact that had not been disclosed on the application as required by the sponsor guidance.
The Home Office Decision
On 6 March 2024, the Secretary of State revoked TJ Trading Express’s sponsor licence with immediate effect, without giving the company any prior notice or opportunity to respond. The revocation letter cited two grounds:
- Ground (o): Assigning a CoS to a close relative without proper disclosure
- Ground (z): Reasonable grounds to believe the role was not genuine
“We believe that the role of ‘Petrol Station Manager’ was created solely to facilitate Mr Sivalingam’s entry to or stay in the UK. As a result, we believe you are in breach of your sponsor duties.” – Home Office revocation letter
The Legal Challenge
TJ Trading Express challenged this decision on several grounds, with the case ultimately focusing on two main issues:
Ground 1: Procedural Unfairness
The company argued that the Home Office had acted procedurally unfairly by revoking the licence without giving them an opportunity to make representations first. This was particularly significant because the revocation had severe consequences for the business and its sponsored workers.
Ground 3: Inadequate Reasoning
The challenge also argued that the Home Office had failed to provide adequate reasoning for concluding that the vacancy was not genuine, and had not properly considered whether there was deliberate wrongdoing.
The Court’s Decision
Procedural Fairness Must Apply
Mrs Justice Hill ruled decisively in favour of TJ Trading Express on the procedural fairness issue. The judgment established several crucial principles:
Key Legal Principle: The common law right to be heard before important benefits are taken away is “fundamental” and applies even where the benefit is described as “a privilege not a right.” This applies with full force where serious allegations are being made.
The Court rejected the Home Office’s arguments that:
- The sponsorship system’s need for robust enforcement justified bypassing procedural fairness
- The “mandatory” nature of the grounds meant no representations were required
- It would be “pointless” to allow representations given the strength of evidence
Interpretation of Home Office Guidance
Significantly, the Court held that the Home Office guidance must be interpreted against the background of common law principles of procedural fairness. The judgment stated:
“The court would be very slow, when construing a policy statement, to conclude that a public authority intends not to act in accordance with that fundamental right [to be heard].”
This means that even though the guidance permits immediate revocation in certain circumstances, this does not override the fundamental right to make representations where someone would be significantly detrimentally affected.
Inadequate Reasoning
The Court also found that the Home Office’s reasoning for concluding the vacancy was not genuine was insufficient. The decision letter gave no explanation of why the Secretary of State believed the vacancy was created “solely” to facilitate immigration, beyond the fact that a CoS had been assigned to a relative without proper disclosure.
Important: The Court noted there was no evidence the decision-maker had considered Mr Ragunathan’s state of mind or whether there was any deliberate conduct, as required by the guidance.
Implications for Sponsors
Enhanced Procedural Protection
This judgment provides significant protection for sponsor licence holders. It establishes that before revoking a licence, the Home Office should:
- Give clear notice of their concerns
- Provide an opportunity for the sponsor to respond
- Consider any representations made before reaching a final decision
- Provide adequate reasoning for their conclusions
Alternative Sanctions
The judgment also recognised that even where breaches are established, revocation is not the only option. The Court noted that the guidance provides alternatives such as:
- Downgrading the licence rating
- Issuing action plans
- Preventing assignment of new CoS
- Restricting use of existing CoS
Residual Discretion
Even where “mandatory” grounds exist, the Secretary of State retains discretion about “when and with what level of firmness she should act.” This means that mitigation and circumstances can still be relevant to the final decision.
Practical Guidance for Sponsors
💡 What This Means for Your Business:
- Know Your Rights: You have a right to be heard before licence revocation
- Respond Quickly: If you receive compliance concerns, seek legal advice immediately
- Document Everything: Keep detailed records of genuine recruitment processes
- Declare Family Connections: Always disclose when sponsoring relatives
- Challenge Unfair Decisions: Procedural unfairness can be successfully challenged
Best Practice Recommendations
- Maintain Comprehensive Records: Document all recruitment processes, including advertisements, interviews, and decision-making
- Follow Disclosure Requirements: Always add sponsor notes when required, particularly for family members
- Respond to Compliance Issues: Engage proactively with any Home Office concerns
- Seek Professional Advice: Complex sponsor compliance issues benefit from expert guidance
- Regular Training: Ensure all relevant staff understand sponsor duties and compliance requirements
Looking Forward
This judgment represents a significant shift in the balance between the Home Office’s enforcement powers and sponsors’ procedural rights. It confirms that fundamental principles of fairness cannot be circumvented, even in the context of immigration control.
For sponsors facing compliance issues, this case provides important ammunition to argue for fair treatment and proper consideration of their circumstances. It also emphasises the importance of adequate reasoning in Home Office decision-making.
⚠️ Note for Sponsors: While this judgment provides important protections, prevention is always better than cure. Ensuring full compliance with sponsor duties and seeking professional advice when issues arise remains the best approach.
Conclusion
The TJ Trading Express case marks an important victory for procedural fairness in immigration law. It establishes that even in the highly regulated world of sponsor licensing, fundamental principles of natural justice must be respected.
For businesses holding sponsor licences, this judgment provides both protection and warning. While you now have clearer rights to be heard before adverse action is taken, the case also demonstrates the serious consequences that can flow from apparently minor compliance failures.
The key lesson is clear: sponsor duties must be taken seriously, proper procedures must be followed, and when problems arise, professional legal advice should be sought immediately.
Facing Sponsor Licence Compliance Issues?
Our experienced immigration team at ARK Law Limited can help protect your sponsor licence and ensure compliance with all requirements. We provide expert guidance on sponsor duties, compliance reviews, and representation in enforcement proceedings.Get Expert Help Today
📞 Call: 0203 633 6005 | ✉️ Email: info@arklawuk.com
About the Author
Amit previously worked with Solicitors and Barristers, practicing in immigration, asylum, human rights, criminal and public law matters. He holds a Master of Laws in Professional Legal Practice (with an overall commendation) from City Law School, City University London.
⚖️ Legal Disclaimer
This analysis is based on the judgment in TJ Trading Express Ltd v Secretary of State for the Home Department [2025] EWHC 1274 (Admin) and is provided for general information purposes only. It does not constitute legal advice and should not be relied upon as such. Immigration law is complex, rapidly changing, and highly fact-specific. The information contained in this article may not reflect the most current legal developments. Always seek professional legal advice tailored to your specific circumstances before making any decisions. ARK Law Limited accepts no responsibility for any loss or damage arising from reliance on the information contained in this article.