The launch of the Fair Work Agency

The Fair Work Agency (FWA) was officially launched on 7 April 2026 and is one of the changes brought in by the Employment Rights Act 2025 and will have direct implications for employers.

What is the FWA?

The FWA is a new government executive agency sponsored by the Department for Business and Trade, designed to enforce workers’ rights and ensure employer compliance.

It acts a single, central enforcement body and is an accumulation of multiple agencies into a single body and transfers the existing powers from HMRC National Minimum Wage (NMW) enforcement team, Gangmasters and Labour Abuse Authority (GLAA) and Employment Agency Standards Inspectorate (EASI) and the Office of the Director of Labour Market Enforcement.

What can the FWA do?

The FWA act as a point of contact for workers who believe their rights have not been upheld and seeks to ensure all workers understand their rights and are supported. It will be responsible for ensuring workers are paid the minimum wage, are treated fairly by employment agencies, are protected from exploitation and abuse and that employers who ignore Employment Tribunal awards are fined and named.

The FWA has a number of enforcement and investigatory powers to ensure compliance and the protection of workers’ rights. These include:

• Carrying out workplace inspections – meaning they can enter the workplace to gather documents and information.
• Investigating without a worker complaint.
• Issuing financial penalties.
• Bringing employment tribunal claims on behalf of workers.
• For serious labour exploitation and criminal cases, the FWA will have the ability to access communication data.

The FWA’s enforcement authority extends over several pieces of legislation ranging from the Fraud Act 2006, Modern Slavery Act 2015 and the Employment Rights Act 2025.

What steps can employers take?

Here are several practical steps employers can take to strengthen compliance and reduce the risk of falling foul of the FWA:

• Conduct a compliance audit: review all aspects of your employment practices, from contracts and payment records to working hours and leave policies, to ensure full adherence to statutory requirements.
• Review your pay calculations: check that everyone is paid at, or above the correct National Minimum or Living Wage – making sure calculations take account of unpaid time, deductions and any other factors that could reduce take-home pay. Do the same for holiday pay, statutory sick pay and all other statutory entitlements.
• Check your records: ensure wage, hours and holiday records are accurate, up to date and stored securely. They should be easy to access if the FWA requests them. From 6 April 2026, employers now have a legal duty to maintain adequate holiday and holiday pay records for up to six years – mirroring the same retention period for National Minimum Wage records.
• Educate your staff: Payroll, HR and managers should understand what the FWA is, the rights it enforces and what good record keeping looks like in practice.

If your business needs help and support with any of these actions, then please get in touch with our Employment team.