The Fair Work Agency (FWA) was established on 7 April 2026 under the Employment Rights Act 2025. It brings together previously fragmented enforcement functions — HMRC's minimum wage team, the Employment Agency Standards Inspectorate, and the Gangmasters and Labour Abuse Authority — into a single labour market enforcement body.
What the FWA Enforces
- National Minimum Wage and National Living Wage compliance
- Statutory Sick Pay — including the new day-one payment rules
- Employment agency and umbrella company standards
- Licensing regimes for high-risk sectors
- Holiday pay — including the new six-year record-keeping requirement
Why It Matters
Until now, most employment rights were only enforced when an individual worker brought a tribunal claim. The FWA changes that: it is a proactive state regulator with powers to inspect workplaces, demand documents, and take enforcement action. Compliance gaps that previously went unnoticed — an underpaid apprentice, SSP paid late, missing holiday records — can now surface through an inspection rather than a grievance.
How SMEs Should Prepare
- Audit minimum wage compliance — include deductions, uniform costs, unpaid training time, and salary-sacrifice effects
- Check SSP processing — day-one payment at the correct 2026/27 rate
- Keep records in order — holiday pay records must now be kept for at least six years
- Fix issues proactively — self-identified and corrected errors are always better than inspector-identified ones
Our compliance audit service reviews your pay, records, and policies against exactly the areas the FWA enforces. Book an audit.