As employment law reforms, fraud prevention duties and AI regulation converge, businesses face heightened scrutiny over who they hire and how decisions are made, says Caroline Smith

The legal landscape surrounding recruitment is undergoing its most significant transformation in years and there is a lot to get to grips with. Between sweeping employment law reforms, new corporate fraud obligations and AI regulation coming into force, pre-employment screening has shifted from a compliance checkbox to a strategic necessity.

The legislative perfect storm

Four major pieces of legislation are converging to reshape how organisations approach hiring:

• Data (Use and Access) Act 2025. This Act potentially brings good news for recruiters. After two previous attempts at GDPR reform, the government has delivered a measured approach that maintains EU adequacy while modernising key areas. Under the Act, digital ID now has a statutory footing, which means we should see continued investment into this sector, with the technology allowing for faster hiring. Additionally, it relaxes rules around automated decision making, making it less of a risk for recruiters to use tools, such as those used to sift through CVs, provided proper safeguards remain in place.
• Employment rights bill. The bill is likely to come into force throughout 2026 and 2027 and aims to deliver one of the biggest overhauls of workers’ protections in a generation. It includes day-one protections for employees and changes to...

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