The Fair Work Agency: what employers need to know
What is it?
The Fair Work Agency (FWA) launched on 7 April 2026 under the Employment Rights Act 2025. It's a single body for enforcing workers' rights, bringing together the Employment Agency Standards Inspectorate, the Gangmasters and Labour Abuse Authority and the Director of Labour Market Enforcement.
It's already legally responsible for minimum wage enforcement, although HMRC is doing that work on its behalf until the full transfer in April 2027. It also runs the penalty scheme for unpaid tribunal awards and Acas settlements. Holiday pay enforcement is expected to start in 2027, and statutory sick pay is due to be added over time.
What does it mean for you?
The FWA doesn't need a complaint to investigate. Its officers can enter premises (with a warrant where needed), inspect records and require information.
The penalties are real. Minimum wage underpayments can already bring a penalty of 200% of the arrears, up to £20,000 per worker, and employers can be publicly named. If you don't pay a tribunal award or Acas settlement, the worker can ask the FWA to step in. It can issue a warning notice and then a penalty of 50% of the unpaid amount (minimum £100, maximum £5,000), on top of what you still owe.
For holiday pay, the government has consulted on letting the FWA look back up to six years, with penalties on the same scale as minimum wage.
✅ Keep annual leave and holiday pay records. This has been a legal requirement since 6 April 2026, and they must be kept for six years
✅ Check holiday pay for the first four weeks of leave includes regular overtime and commission, not just basic pay
✅ Audit pay against the minimum wage rules
✅ Pay tribunal awards and settlements on time
✅ Decide who would deal with an FWA letter or visit
How Lansbury HR can help
We can audit your pay and holiday records, check your holiday pay calculations and get you ready for an inspection. Get in touch.
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