If the Fair Work Agency Contacted Your Business Tomorrow, Would You Be Ready?
The arrival of the Fair Work Agency changes the employment enforcement landscape for UK businesses. For responsible employers, the concern shouldn't necessarily be that they are deliberately doing anything wrong. A much more useful question is whether they could demonstrate that they are doing things right if their employment practices came under scrutiny.
Imagine receiving contact from an enforcement officer tomorrow asking for information or employment records. How quickly could your business respond? Would the relevant information be accurate, current and easy to retrieve, or would somebody need to search through payroll systems, spreadsheets, emails, employee folders and managers' records to piece everything together?
The Fair Work Agency began operating on 7 April 2026, bringing enforcement of a number of employment rights into a single body. It has statutory powers to investigate employers, require information and inspect records, while its published priorities for 2026/27 include more visible and impactful enforcement.
For employers, that makes now a sensible time to ask: if our employment practices were examined, would our records demonstrate that we are managing our responsibilities properly?
What Is the Fair Work Agency?
The Fair Work Agency, or FWA, has been created as part of the government's employment rights reforms and brings several existing enforcement functions together. Its responsibilities include enforcement of the National Minimum Wage and National Living Wage, regulation of employment agencies and employment businesses, labour provider licensing in relevant sectors and action concerning serious labour exploitation. It can also take enforcement action in relation to unpaid employment tribunal awards and Acas settlements.
Its remit will expand as further employment reforms take effect. Additional areas, including enforcement relating to statutory holiday pay and statutory sick pay, are due to come within its responsibilities over time.
This doesn't mean the FWA has become a general inspector of every HR decision made by every employer. Its enforcement powers apply to legislation within its remit. However, the direction of travel is significant for businesses: employment rights enforcement is becoming more consolidated, visible and proactive.
The government's own guidance recommends that employers review their compliance with existing employment rights and consider whether their record keeping arrangements allow them to demonstrate that their legal obligations are being met.
What Could an Investigation Involve?
The Fair Work Agency isn't simply an advisory body. Its enforcement officers have statutory investigatory powers, and depending on the circumstances an investigation may involve requests for information, examination of records, interviews with workers or business representatives and visits to business premises.
The FWA has said that businesses will generally be contacted in advance where a consensual site visit is being arranged. However, its enforcement framework also allows unannounced investigations where appropriate. Some investigations may not involve a site visit at all and could instead be conducted through written enquiries or examination of digital records.
This makes the quality of an employer's records particularly important. If information is requested, the business needs to know what it holds, where it is and whether it accurately reflects what happened.
Being Compliant and Being Able to Evidence Compliance Are Different Things
Most responsible employers would probably say that they intend to comply with employment law. The difficulty is that good intentions aren't the same as evidence.
Take minimum wage compliance. An employer may be completely confident that nobody is deliberately being underpaid, yet compliance can involve more than checking the hourly rate shown on a payslip. Working time, deductions and particular pay arrangements can all become relevant. If questions were raised, the employer may need records capable of demonstrating how pay was calculated and what working arrangements actually applied.
The same principle can be applied more broadly to employment management. A policy may say one thing while a manager routinely does another. Payroll information may not reflect an informal change in working arrangements. A spreadsheet may contain an old record that nobody realised needed updating.
No individual mistake necessarily means the employer intended to do anything wrong. The problem is that policy, practice and records no longer tell the same story.
Could You Produce the Evidence?
A useful exercise for employers is to imagine being asked to evidence an employment practice today.
Could you quickly establish what hours an employee worked and how they were paid? Could you find the relevant employment documentation? Could you demonstrate how holiday entitlement was calculated? Could you locate sickness and statutory payment records? If an arrangement changed, could you establish when and why?
The answer may currently involve checking several different places. Many small businesses have HR information distributed between payroll software, spreadsheets, shared drives, email inboxes, paper files and individual managers.
That approach can work when everybody knows where everything is. It becomes much less reliable when somebody leaves, records aren't updated or the business suddenly needs to reconstruct what happened months earlier.
Good HR record keeping isn't about creating paperwork for the sake of it. It means maintaining enough reliable information to understand and evidence the employment relationship when necessary.
Pay, Holiday and Sickness Deserve Particular Attention
National Minimum Wage and National Living Wage enforcement already forms part of the Fair Work Agency's remit, so employers should be confident that their pay arrangements and supporting records are accurate.
Holiday pay and statutory sick pay are also important areas to review as the FWA's enforcement responsibilities expand. Government guidance currently indicates that holiday pay enforcement will begin during 2027 and not before April 2027.
Employers therefore have an opportunity to identify weaknesses before those changes take effect. This could include checking whether holiday entitlement and pay are calculated correctly for different working patterns, whether sickness information is accurately recorded and whether statutory payments are being handled appropriately.
The aim shouldn't be to conduct a frantic compliance exercise because enforcement is changing. It should be to make accurate employment records part of normal business operations.
What Should Employers Review?
A sensible review doesn't need to involve pulling every employee file apart. Start with the areas where the business has legal obligations and ask whether the current records allow you to demonstrate what is actually happening.
For example, consider whether:
employee and employment records are complete, accurate and current
pay and relevant working time information can be evidenced
National Minimum Wage requirements are being met
holiday entitlement and holiday pay are being managed correctly
sickness and statutory payment information is reliable
employment status reflects the reality of the working relationship
managers are following the procedures the business says it follows
relevant employment documentation is current
important decisions and changes are appropriately recorded
information can be retrieved without relying on one person's memory
It is also worth deciding who within the organisation would take responsibility if the FWA did contact the business. An official request shouldn't be forwarded around internally while everybody tries to decide who is supposed to deal with it.
Record Keeping Isn't Something to Fix Afterwards
There is another reason employers should take record keeping seriously. The FWA's enforcement framework includes offences relating to obstructing enforcement activity and providing false documentation.
That makes the principle straightforward: the time to make sure your records are accurate is before anybody asks to see them.
Trying to reconstruct employment records after concerns have already been raised is inherently more difficult. Even where there is no suggestion of deliberate wrongdoing, missing or inconsistent information can make it harder for the business to establish what actually happened.
Maintaining reliable records as part of everyday HR management is considerably easier than attempting to recreate them months later.
A One-Off Compliance Audit Isn't Enough
Conducting a review now is useful, but HR compliance doesn't remain frozen in time.
New employees join. Pay rates change. People change their hours. Probation periods end. Employees become eligible for different statutory rights. Working practices evolve and employment law changes.
A business could complete a comprehensive review today and gradually become less compliant over the following twelve months if nobody continues monitoring what changes.
That is one of the limitations of treating compliance as an annual checklist. The checklist tells you what was true on the day you completed it.
Good compliance needs to be maintained as the business changes.
How Leo HR Helps Employers Stay Ready
This is where Leo HR can make a significant difference for smaller employers.
A business shouldn't need an enforcement request before somebody discovers that an important record is missing or a process hasn't been followed properly. Leo HR is designed to bring employee management, compliance, company knowledge, workplace Matters and documentation into a connected HR environment so employers have greater visibility over what is happening across their workforce.
That reduces reliance on spreadsheets, disconnected folders and individual managers remembering what needs to happen. Important employment information can remain connected to the wider employee relationship, making it easier to understand the current position and maintain a reliable history.
Leo then adds something that traditional record keeping systems cannot provide: support when the employer needs to act on that information.
If a manager is unsure how to deal with an employment issue, they can ask Leo 24/7. Leo can work with relevant authorised business context to help the employer understand the situation, identify information that may be missing, recognise potential risk and consider what should happen next.
That matters for compliance because poor employment records often begin with poor employment decisions. If a manager handles something incorrectly and nobody identifies the problem, the mistake can simply become part of the company's record.
Helping managers get the decision right in the first place is therefore an important part of maintaining better employment practices.
What Would Happen If the FWA Contacted You Tomorrow?
There is a considerable difference between receiving an enforcement request when HR information is scattered across several systems and receiving one when employment records have been maintained consistently as part of everyday business operations.
Ideally, an employer shouldn't suddenly need to “prepare” its employment records for inspection. The relevant information should already exist because the business has been managing HR properly.
That doesn't mean every small business needs an internal compliance department. It means the business needs appropriate systems, reliable records and somewhere managers can turn when they aren't sure what to do.
Leo HR is designed to provide exactly that infrastructure: HR information organised within the business, compliance easier to monitor and an AI HR Director available whenever managers need support.
Don't Wait for Someone Else to Find the Gaps
The Fair Work Agency shouldn't be viewed purely as something for employers to fear. Its role includes encouraging and supporting compliance as well as taking enforcement action where necessary.
For responsible employers, its arrival is an opportunity to look at HR from a different perspective.
Don't just ask whether you believe the business is compliant. Ask whether you could demonstrate it.
Are your records accurate? Do managers follow your procedures? Can you find the evidence? Would you spot a problem before an enforcement officer did?
If the answer to any of those questions is uncertain, now is the time to address it.
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