The government is proposing a new state enforcement agency, the Fair Work Agency (FWA), as part of the Employment Rights Bill, meaning that UK businesses and HR leaders must adapt to stay compliant.
The Employment Rights Bill is set to make 2025 a landmark year for employment law, with sweeping changes that will redefine workplace rights and employer responsibilities.
The FWA will be granted authority to ensure that businesses fulfil their employment law obligations, with employers potentially facing increased scrutiny in areas such as holiday pay compliance. Businesses that fail to adhere to current regulations or are found in violation could incur substantial fines or legal repercussions.
Read more: Employment Rights Bill: HR reacts
While the FWA is unlikely to take effect until two years after a consultation period (autumn 2026), businesses must be proactive in compliance.
What will the FWA cover?
The proposed FWA will be responsible for the following employment areas:
National minimum wage
Statutory sick pay
Holiday pay – this includes rolled-up holiday pay rights for part-year and other non-typical workers
Employment agency rules
Failure to pay compensation orders or settlement sums by an employment tribunal.
The FWA is also expected to acquire the responsibilities of agencies like the Gangmasters and Labour Abuse Authority and the Director of Labour Market Enforcement. This means that it will act as a single body to enforce workers’ rights, and be responsible...
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