Fair Work Agency receives strategic steer from government
The government published its strategic steer to the new Fair Work Agency for its transitional year of operation, explaining how the agency should prioritise enforcement activity as it prepares to assume its full remit. The government is establishing the FWA through a phased transition and has set out the following arrangements:
• From April 2026, the government will bring responsibility for securing compliance with the following regimes together under the FWA: agency worker regulations; gangmasters licensing; and serious labour abuse, including modern slavery;
• During 2026/27, HMRC will continue to enforce the National Minimum Wage under a contractual arrangement with the FWA. This approach maintains continuity of service while the FWA prepares to take full responsibility for NMW enforcement in April 2027; and
• From 2027, the FWA will begin enforcing holiday pay rights.
The government also sets wider expectations for the transitional year. It expects the FWA to focus on five priorities: reducing regulatory burdens; improving intelligence and data use; increasing public awareness and stakeholder engagement; providing thought leadership; and preparing for 2027 and beyond.
In addition, the FWA has published:
• an enforcement policy statement explaining how the FWA will use its enforcement powers in practice and the principles that guide its decisions; and
• a code of practice on Fair Work Agency labour market enforcement undertakings and orders, setting out how the agency will use the powers the ERA to strengthen enforcement.
While the transitional year is focused on set up, the direction of travel points towards a stronger, more proactive compliance regime and employers may want to familiarise themselves with the role and remit of the FWA ahead of it becoming fully operational.
Institute of Directors call for better employer engagement on ERA consultations
The Institute of Directors released a statement calling on the government to address employer concerns when developing secondary legislation to implement new rights and obligations under the ERA. The IoD highlights the need to reverse ongoing stagnation in employer demand for labour. Latest Office for National Statistics labour market data shows payrolled employees fell by 11,000 over the month, while vacancies fell by 3.9% over the quarter. The IoD also refers to the government’s recent response to the consultation on trade unions’ new right to access workplaces. It describes that response as a missed opportunity to demonstrate to employers that it is taking a pragmatic approach to implementing the ERA and says it shows “little to no evidence that employer concerns are being listened to”. Although the IoD does not give specific examples of how the government failed to listen to employers in that consultation response, it may have formed this impression because the government pressed ahead with several proposals despite opposition. For example, the government decided to proceed even though:
• 95.3% of respondents disagreed with weekly access;
• 85.2% of respondents disagreed with requiring a minimum of five working days’ notice before a first access visit; and
• 92.4% of respondents disagreed with requiring unions to give at least two working days’ notice before subsequent access visits.
We have reported on multiple consultations since the start of the year. There are currently six open ERA / Make Work Pay consultations, as well as one call for evidence. Employers may wish to consider whether to engage with any of the following:
• Protection from detriments for taking industrial action (closes 23 April)
• Improving access to flexible working (closes 30 April)
• Modernising the Agency Work Regulatory Framework (closes 1 May)
• Draft code of practice on trade union right of access (closes 20 May)
• Threshold for triggering collective redundancy obligations (closes 21 May)
• Transfer of Undertakings (Protection of Employment) Regulations (closes 1 July)
• Misuse of non-disclosure agreements (NDAs) (closes 8 July)
Minutes from ET User Group highlights sustained pressure
The published minutes from the ET's National User Group's March meeting highlight the operational challenges that will continue to affect the ET system and employers managing claims.
• ET claim volumes: ETs continue to experience high volumes of claims, with pressure varying by region. The ETs are receiving single claims at their highest level since the pandemic, and complex claims now make up 60% of single claims received. Judges shared the view that increased use of AI has contributed to greater claim complexity, a rise in applications for reconsideration and interim relief, and inflated schedules of loss.
• Hearing delays: ETs continue to report longer lead in times to final hearings in many areas. London South faces particular pressure, with the ET listing five day hearings for 2029. Although the system is recruiting employment judges, recruitment has not met demand, especially in London, making it harder to address increasingly long waiting times.
• Acas Early Conciliation: Acas has experienced an unprecedented surge in EC demand. Between April 2025 and February 2026, it received over 135,000 EC notifications, already exceeding last year’s total and putting the service on track to handle around 150,000 cases this year which is the highest number on record. This sharp increase has caused delays, with Acas currently taking around five weeks to allocate cases to conciliators. Acas expects further pressure as new rights under the ERA are expected to increase EC demand by an estimated 15-20%.
Overall, the March 2026 ET NUG minutes show increasing pressure on case management. Employers should factor extended timelines into litigation strategy, including planning for witness availability and document retention. The update also reinforces the value of proactive and early dispute resolution.
