The Fair Work Agency – What UK Employers Need to Know and How to Prepare

From 07 April 2026, the Fair Work Agency (‘the Agency’) will be introduced in the UK. This is a new body designed to ‘strengthen and simplify’ the enforcement of rights of workers and employees. 

The Agency will act as a single enforcement body for a range of workplace rights, and is intended to bring together functions which are currently spread across numerous organisations. 

At present, the Agency will be able to enforce:

• National Minimum Wage; 

• Statutory holiday pay and entitlement;

• Statutory sick pay;

• Employment agency;

• Gangmasters licensing standards;

• Labour exploitation; and 

• Recovering unpaid Employment Tribunal awards.

The Secretary of State has confirmed they intend to expand on the above list in the future, subject to Parliamentary approval. 

National Minimum Wage will be a large focus of the Agency, and it is important that employers are paying their team members correctly. You can read more about the National Minimum Wage increase from April 2026 in our recent blog post: Everything you need to know about the upcoming changes to National Minimum Wage.

As of 09 February 2026, it is not yet known whether all enforcement powers will commence immediately at the launch of the Agency, or whether some aspects will come into effect before others, in a staggered approach.

Whilst at present the Agency will not create new employment rights, it will change how current employment rights are enforced; there will be proactive enforcement, rather than there being a requirement for an employee or worker to raise a complaint. 

The Fair Work Agency will be able to open investigations into suspected non-compliance, including carrying out unannounced visits to employer premises. Failure to co-operate with the Agency’s investigations or providing false information may result in criminal action being taken, including fines, and imprisonment up to 51 weeks.

The Agency will have the ability to issue a Notice of Underpayment for non-payment or underpayment of statutory entitlements, and civil penalties. Any payment of arrears should be made to the employee / worker within 28 days of the decision. 

Underpayments may be recovered for a lookback period of up to 6 years, meaning breaches occurring from April 2020 may be investigated. 

The employer will also be subject to a financial penalty, which has been described as 200% of the sums due, subject to a cap of £20,000 per worker, and a potential discount where payment is made promptly. 

In addition, where enforcement action is required due to failing to comply with a decision (i.e. not paying the arrears owed or the financial penalty), the Agency may require the employer to pay a charge which reflects the costs incurred in enforcing the decision. 

The Agency will have a ‘civil proceedings power’, which will mean it is able to bring Tribunal proceedings in place of an individual, where the individual has the right to bring a claim but appears ‘unlikely to do so’. It will also be able to provide legal advice and assistance in civil proceedings relating to employment, trade union and labour relations law, including potentially providing representation.

The Agency will act in a similar way to a regulator, and is not a Court or Tribunal. Therefore, its records will not be open to the public by default under the ‘open justice’ principle. However, certain aspects will become available to the public through statutory publication regimes such as the naming of non-compliant employers through an annual report, Freedom of Information Act requests in limited circumstances, and any subsequent Employment Tribunal proceedings. 

There is a risk that self-employed Associates, Hygienists or Therapists will also be caught by the Fair Work Agency. Through its officers and investigatory powers, the Agency will form an initial assessment on whether the individual has been treated as an employee or a worker. This will then form the basis for their full investigation and enforcement decisions. Where the individual’s employment status, as determined by the Agency, is disputed, the decision will be appealed to the Employment Tribunal, where the individual’s status will be determined by an Employment Judge. Therefore, it is important that not only do you have the correct agreements in place, but that your self-employed team members are treated in a way that supports their self-employed status!

At present, there is little information available in relation to the powers of the Agency, and what is available is very vague. We will keep you updated as more information becomes available. If you have any questions, would like your self-employed agreements reviewing or are contacted by a representative of the Fair Work Agency, please do not hesitate to contact us on 0330 088 2275 or info@buxtoncoates.com