Employment Rights Bill (Act 2025) - What is Fair Work Agency?

With the Employment Rights Bill becoming the Employment Rights Act 2025, business owners across the country will have to be compliant with the new employment rights mandated in the legislation. This will affect all businesses of all sizes and employers should ensure that their contract and documentation are up to date to reflect this, else risk not only falling foul of an employment tribunal ruling but they could find themselves being paid a visit by an enforcement agent from the Fair Work Agency (FWA).

The Fair Work Agency will come into force April 7th (2026) as part of enforcing Employment Rights Act 2025 penalties. Establishing the FWA means employers who fail inspection when visited by an enforcement agent could even face criminal charges, if found in breach of certain labour practices.

Here at Croner, we’re dedicated to helping business owners like yourselves to understand these changes, and how you can implement them into your business’s everyday practices, so that your business is compliant with the Employment Rights Act.

Get in touch with one of Croner’s experts on 01455 858 132.

• Is there a current policy in place for the Fair Work Agency?
• How will the FWA work?
• What enforcement powers will the FWA have?
• How can Croner help?

Is there a current policy in place for the Fair Work Agency? 

At the time of announcement, any employment rights enforcement was carried out by the individual(s) who submitted the claim at an employment tribunal. 

Although there are a few employment rights enforcements which are carried out by the state on behalf of workers around the country - Think National Minimum Wage or protections for agency workers. 

The government stated that the current system of state enforcements is ‘fragmented and ineffective’. As expected this creates more complex processes for workers and employees who require support, and help workers to enforce their rights within the workplace. 

What changes has the Employment Rights Act 2025 made law?

The Fair Work Agency (UK) or FWA, will collate the existing state enforcements and tackle enforcing a wider range of employment rights. This will create a single place where both employees and employers can turn to for support. 

Not only this, the Fair Work Agency will have stronger powers to investigate issues and undertake action against employers and business owners who aren’t abiding by the law. 

How will the FWA work? 

The Fair Work Agency, will form part of the executive agency of the Department for Business and Trade (DBT), but won’t have its own distinct legal identity. The Employment Rights Act 2025 will give the Secretary of State a series of functions to enforce particular employment legislations. 

These functions will be enacted by the Fair Work Agency (including any enforcement officers who are appointed by the Secretary of State).

As the Act plans to combine the existing state enforcements with those relating to statutory sick pay and holiday pay. It also includes giving the Secretary of State the ability to make affirmative regulations to increase the state enforcement remit to include any other employment law related legislations. 

Under this change in the Employment Rights Act 2025, Labour plans to abolish two existing public bodies (The Gangmaster and Labour Abuse Authority, and the Director of Labour Market Enforcement). The work these two organisations currently do, will continue under the Fair Work Agency. 

The Fair Work Agency will see the introduction of an advisory board with a social partnership model. Meaning equal representation from businesses, trade unions and representatives, and independent experts. 

The Government is planning to add some additional enforcement powers, this will include the power to issue civil penalties to enforce employee compensation from employers (based on the National Minimum wage act 1998). 

What enforcement powers will the FWA have?

• The authority to inspect workplaces and requirements for employers to produce relevant documents and evidence that demonstrate compliance with employment law. This power will be based on those existing bodies already have. 
• Civil penalty regime (based on the National Minimum Wage Act 1998). In instances where enforcement officers find that employers have underpaid workers, they can issue Notices of Underpayment requiring employers to pay workers their due and pay a penalty to government.
• Power to bring civil proceedings in the employment tribunal on behalf of workers, as well as offering legal advice and assistance in instances where someone is, or may be, party to civil legal cases related to employment or trade union law. 
• Enforcement regime in respect of labour market criminal offences (based on the Labour Market Enforcement regime in the Immigration Act 2016). This requires employers to correct their behaviour and involves voluntary Labour Market Enforcement Undertakings and compulsory Labour Market Enforcement Orders. Breach of a Labour Market Enforcement Order is a criminal offence that can result in fines or imprisonment.
• The Secretary of State will be able to set out, in regulations, how the Fair Work Agency can implement charges recovering enforcement costs from employers against employers found non-compliant. 

How can Croner help?

If you’re wondering how the Fair Work Agency will affect your business, or how YOUR business will be affected by the Employment Rights Act, then let Croner’s experts help you. 

Our advisors are on hand 24/7 to help support and advise you and get you through the changes. Get in contact here 01455 858 132.