The UK government has introduced new payroll rules for the Skilled Worker visa route from 8 April 2026.
From that date, the Home Office can assess salary compliance by examining how sponsored workers are paid across defined pay periods, rather than relying primarily on the annual salary recorded on the Certificate of Sponsorship.
Historically, immigration salary compliance focused mainly on the annual salary threshold and the occupation going rate. Provided the annual figure met the relevant requirement, payroll fluctuations across the year were often tolerated.
The new rule changes that approach, as salary compliance will be assessed against defined pay periods. Employers sponsoring Skilled Workers need to ensure that salary paid during defined pay periods aligns with the immigration salary rules.
This change will be particularly relevant for smaller employers who operate flexible payroll arrangements or whose payroll systems are not designed around immigration compliance checks.
How the new Skilled Worker pay rules work
The central principle introduced by paragraph SW 14.3B is that salary compliance is now assessed across payroll periods rather than only on an annualised basis.
The rule also requires the worker to be paid the required salary in pay periods of at least monthly frequency, or as otherwise specified in their employment contract.
This means the Home Office can examine payslips and payroll records to determine whether the salary paid during each relevant period meets the required immigration salary level.
If salary falls below the required level during the relevant pay period and cannot be justified under the averaging rules in the Immigration Rules, the Home Office may treat this as underpayment for immigration purposes.
The new provision introduces several technical requirements on how sponsored workers are paid. These rules determine how salary compliance is assessed during the sponsorship period.
Workers need to be paid regularly
Sponsored workers are expected to be paid through normal payroll cycles that correspond with the pay period used for salary assessment. The Home Office therefore expects salary to be distributed through normal payroll cycles rather than irregular or deferred payments.
Salary must meet the required threshold during the pay period
Under SW 14.3B, the salary paid in each pay period must equal or exceed the going rate for every hour worked in that pay period. This creates a pay-period salary test that operates alongside the existing annual salary requirement. The change means that payroll records should demonstrate that the worker’s pay reflects the required salary level during each payroll cycle.
Limited salary averaging is still permitted
The Immigration Rules allow salary to fluctuate across short periods provided the overall pay during those periods still meets the required level.
If the worker is paid monthly or less frequently, the salary paid over any three-month period must be at least equal to one quarter of the required annual salary.
If the worker is paid more frequently than monthly, the salary paid over any 12-week period must be at least equal to 12/52 of the required annual salary.
These provisions allow short term fluctuations in pay but prevent significant underpayment during the year.
Irregular working patterns
Where a worker’s hours vary each week, a longer averaging window applies. Sponsors need to demonstrate that salary paid across any seventeen week period equals at least seventeen fifty-seconds of the required annual salary.
This provision recognises that some roles involve fluctuating hours but still requires the overall salary during the relevant period to remain compliant.
Salary reductions caused by permitted subtractions
SW 14.3B also covers situations where salary falls below the pay period thresholds because salary subtractions permitted under SW 14.2(a) are taken over a shorter period than the overall sponsorship period. In those circumstances, the sponsor is required to confirm that the reduction results from those permitted salary subtractions rather than underpayment.
Impact on Skilled Worker sponsors
For many smaller employers, immigration salary compliance has traditionally been assessed through the annual salary figure recorded on the Certificate of Sponsorship. Payroll fluctuations during the year could occur provided the annual salary requirement was ultimately met.
The new rule reduces that flexibility. UKVI can now review payroll records across defined pay periods when assessing whether sponsorship salary requirements are being met.
This means smaller sponsors should pay closer attention to how payroll operates for sponsored workers.
Payroll evidence will become more important
During a sponsor compliance audit, UKVI officers may examine payslips, payroll reports and working hours. These records can now be assessed against the pay period requirements in Appendix Skilled Worker.
If salary during the relevant period falls below the required level and cannot be justified under the permitted averaging rules, the Home Office may treat the situation as underpayment.
Uneven pay structures may create risk
Some compensation structures rely on uneven payments across the year. This may include situations where salary is temporarily lower and later increased through bonuses or deferred payments.
Under the new framework, the Home Office can examine whether salary met the required level during the relevant payroll period rather than relying mainly on the annual salary figure.
Payroll and HR systems need to align
Small businesses often operate payroll systems that are designed for tax and employment compliance rather than immigration compliance.
The new rules mean payroll records, employment contracts and sponsorship records should align. Employers should ensure that salary paid during payroll cycles matches the immigration salary requirements recorded on the Certificate of Sponsorship.
Timing of the new rule
The pay period rule introduced by paragraph SW 14.3B takes effect on 8 April 2026.
Under the transitional provisions in HC 1691, applications made using a Certificate of Sponsorship assigned before 8 April 2026 will normally be decided under the Immigration Rules in force on 7 April 2026. Where an application does not require a Certificate of Sponsorship and was made before 8 April 2026, it will also be decided under the Rules in force on that date.
For employers planning Skilled Worker sponsorship in the near term, the implementation date may therefore be relevant where salary arrangements involve uneven payroll patterns.
Practical steps for employers
Small business sponsors should review how payroll arrangements operate for sponsored workers before the new rule takes effect.
- Check that payroll cycles reflect the salary level stated on the Certificate of Sponsorship.
- Ensure the salary paid in each pay period equals or exceeds the going rate for every hour worked in that pay period.
- Confirm that payroll records demonstrate compliance with the three-month, twelve-week or seventeen-week averaging rules.
- Review any compensation arrangements that rely on uneven pay across the year.
These checks will help ensure that payroll records demonstrate compliance if the Home Office reviews sponsor records during a compliance audit.
Author
Gill Laing is a qualified Legal Researcher & Analyst with niche specialisms in Law, Tax, Human Resources, Immigration & Employment Law.
Gill is a Multiple Business Owner and the Managing Director of Prof Services Limited - a Marketing & Content Agency for the Professional Services Sector.
