EORs and Immigration: Hiring Non‑UK Nationals Under UK EOR Contracts

When companies expand into the UK and hire talent from overseas, they assume that establishing a UK entity or overcoming visa sponsorship is unavoidable. However, leveraging an employer of record UK solution can simplify the process, provided companies understand the immigration constraints and legal requirements. This guide explores how EORs interact with UK immigration law, what limitations exist when hiring non‑UK nationals, and best practices for structuring UK employment arrangements.

Key Takeaways

1. An employer of record UK can handle local payroll, contracts, taxes, and statutory compliance, but generally cannot act as a visa sponsor.
2. Non‑UK nationals requiring visas, like the Skilled Worker visa, must be employed by a licensed sponsor.
3. EORs are ideal for hiring candidates who already hold UK work rights or for managing remote employees.
4. Choosing a reliable EOR provider ensures proper compliance with UK labour law and payroll regulations.
5. Structuring employment carefully can mitigate risks related to tax, immigration, and employment disputes.

EORs in the UK Context

An employer of record UK is a third-party provider that becomes the formal employer of your UK-based employees. On behalf of the client company, the EOR manages payroll, tax withholding, National Insurance contributions, statutory leave, and contract compliance. The client company controls day-to-day responsibilities, work assignments, and performance oversight.

Using an EOR allows companies to hire in the UK without establishing a full legal entity, reducing administrative overhead and accelerating the hiring process. This model is particularly useful for businesses entering the UK market for the first time or those looking to expand quickly.

However, when non-UK nationals are involved, the EOR model has certain limitations. UK immigration law requires a visa sponsor for non-UK nationals to legally work in the country. Since an EOR operates as a delegated employer, it usually cannot act as a visa sponsor under UKVI regulations. Attempting to employ a visa-required candidate only through an EOR may result in non-compliance or legal complications.

Immigration and Visa Sponsorship Requirements

Most non-British or non-Irish nationals need a valid visa to work in the UK. The Skilled Worker visa is the most common route and comes with specific employer obligations:

• Only employers with a valid sponsor licence can issue a Certificate of Sponsorship (CoS).
• The sponsor must demonstrate direct control over employment, including salary, duties, and supervision.
• The role must meet the required skill and salary thresholds.
• A genuine vacancy must exist for the role.

Because an employer of record UK does not have full control over the employee’s work, it cannot fulfil the sponsorship requirements. The UKVI may consider the client company as the “real employer” if it exerts substantial control, which can further complicate visa compliance.

In addition, UK right-to-work rules require employers to verify that employees have valid work documentation. Non-UK nationals must provide proof of visa or settlement status allowing them to work legally.

When an EOR Arrangement Works for Non‑UK Nationals

Despite limitations, there are cases where hiring non-UK nationals via an employer of record UK is feasible:

1. Candidates already authorised to work in the UK: Individuals with indefinite leave to remain, settled status, or other valid visas can be employed directly through the EOR.
2. Remote work from outside the UK: If the employee stays in their home country, the EOR manages the contract under local law rather than UK immigration law.
3. Intra-company transfers using a licensed UK entity: If your company has a UK subsidiary with a sponsor licence, you may issue the visa through that entity while the EOR handles administrative tasks such as payroll and HR support.
4. Short-term business arrangements: For certain business visits or consultancy work that does not require a visa, the EOR can facilitate compliance and local contracts.

Risks and Considerations

When hiring non-UK nationals via an employer of record UK, the following risks must be managed:

• Immigration non-compliance: Misusing an EOR for visa-required employees may cause visa refusal or revocation.
• Deemed employer status: If the client company exercises too much control, regulators may treat it as the actual employer, creating tax or legal liabilities.
• Termination and liability issues: UK employees with more than two years of service are entitled to protection against unfair dismissal. Since the EOR is the formal employer, it must handle terminations, creating potential conflicts.
• Permanent establishment risk: Employees performing activities that establish a fixed presence in the UK could trigger corporate tax obligations.

Best Practices When Hiring Non‑UK Nationals

1. Verify work eligibility: Confirm visa or settlement status before starting employment.
2. Engage immigration counsel: Take legal guidance to comply with UKVI and employment law.
3. Define roles and control boundaries: Avoid excessive client company control to prevent regulatory issues.
4. Clarify termination processes: Clearly allocate responsibility between the EOR and the client company.
5. Monitor contract durations and employee rights: Long-term contracts may trigger additional legal protections.
6. Assess growth needs: If hiring multiple visa-required employees, consider establishing a UK subsidiary with a sponsor licence.

Conclusion

An employer of record UK provides companies a practical way to hire UK-based employees and manage compliance, payroll, and benefits without establishing a UK legal entity. For non-UK nationals, visa requirements are a critical consideration. EORs cannot replace a sponsor licence for visa-required roles, but they offer efficient administration for employees who already have UK work rights or for remote hires outside the UK.

Combining an EOR with careful immigration planning ensures legal compliance, reduces operational burden, and allows companies to scale their UK workforce. By choosing a reliable EOR provider and structuring employment correctly, businesses can take advantage of local expertise, compliance support, and efficient onboarding.

FAQs

Can an EOR in the UK sponsor visas for non-UK nationals?

No. UK visa sponsorship must be performed by a licensed sponsor employer. EORs generally cannot act as a sponsor under UKVI rules.

Can I hire a non-UK national remotely through an EOR?

Yes. If the employee works outside the UK, the EOR can manage their contract under local regulations, bypassing UK visa requirements.

What if my company already has a UK subsidiary with a sponsor licence?

You can sponsor visas through your UK entity and still leverage an EOR for administrative tasks like payroll and HR, provided responsibilities are clearly defined.

What are the main risks of misusing an EOR for visa-required employees?

Risks include visa violations, potential tax exposure, employment disputes, and being treated as the actual employer by regulators. Proper structuring and legal guidance mitigate these risks.