Fair Work Agency: Employer Guidance on the New Enforcement Body

On 7 April 2026, the new Fair Work Agency (FWA) officially launched, taking on several enforcement and licensing responsibilities, previously carried out by other bodies. In due course, the FWA will expand into enforcing certain wider employment law rights.

This article covers what we know at the time of the FWA’s launch. The nature of how the FWA will enforce labour market abuses will be covered both on our website and via our app as details unfold.

What is the Fair Work Agency?

As we covered when plans were announced, FWA is created under the Employment Rights Act 2025 (ERA 2025) as a single enforcement body to strengthen the policing of labour market abuses. It was brought in to:

• Act on behalf of the Secretary of State for Business and Trade.
• Conduct investigations and inspections.
• Issue enforcement notices, and labour market orders and undertakings.
• Bring certain claims on behalf of workers.
• Recover its enforcement costs from non‑compliant employers.

The government intends it to deliver “stronger, simpler and more visible” enforcement across the labour market.

What Does the FWA Enforce?

The FWA began active enforcement from 7 April 2026 in the following areas:

• National Minimum Wage (NMW) enforcement (formerly overseen by HM Revenue and Customs).

Includes:

• Investigating worker complaints.
• Proactive compliance checks.
• Enforcing payment of National Minimum Wage arrears.
• Imposing financial penalties on non-compliant businesses.
• Monitoring that employers do not fire or penalise workers for raising issues on non-compliance.`
• Payment of financial penalties for failure to pay sums ordered by an employment tribunal or settlement sums agreed in a COT3.
• Agency Worker regulation (formerly overseen by the Employment Agency Standards Inspectorate)

As well as investigations into:

• Breaches by employment agencies and employment businesses.
• Non‑compliant terms, unfair fees, and unlawful recruitment practices.
• Failures around key information documents, which going forwards will need to include the contact details of FWA enforcement officers.
• Gangmaster licensing and labour exploitation

The ERA 2025 abolishes the Gangmasters and Labour Abuse Authority, with its functions transferring to the Secretary of State and being carried out operationally by the FWA.

This includes:

• Licensing for labour providers in regulated sectors, such as agriculture and horticulture, to ensure compliance with standards.
• Investigations into labour market offences, with the ability to issue enforcement undertakings.
• Use of powers under the Police and Criminal Evidence Act 1984 and the Investigatory Powers Act 2016.
• Continuation of existing appeals and oversight arrangements.

What is the FWA is expected to enforce in the future?

The government has confirmed that, over time, the FWA will also assume responsibility for the enforcement of:

• Holiday Pay

The FWA is expected to be empowered to investigate and enforce underpayments of statutory holiday pay.

• Statutory Sick Pay (SSP)

It is expected that the FWA will investigate unlawful refusals to pay SSP and systemic abuse.

• There is flexibility for the enforcement of additional rights to be brought under the FWA’s remit in the future.

Final thoughts

The establishment of the FWA marks a move towards stronger, more unified labour market enforcement. While the initial changes brought in on 7 April 2026 focus on NMW, agency workers, gangmaster licensing and labour exploitation, the longer‑term picture is far more significant for all employers.

Employers who have nor done so in the lead up to the FWA’s launch should make changes now. Organisation which tighten governance, audit NMW, holiday pay and SSP compliance and improve compliance procedures will be well placed for the broader enforcement powers expected in the coming months and years.

For information on preparing for enhanced labour market enforcement under the FWA, see our previous article.

Please note, the content of this article is correct at the time of publication and could be subject to change.