What is the Fair Work Agency?

The Fair Work Agency is a creation of the Labour Government. Labour proposes to create a new state
enforcement body for employment rights. For now the proposed name is the Fair Work Agency although
this is not yet official.

The most recent amendments to the Employment Rights Bill indicate that it will provide as follows:

• The FWA will be able to bring claims on behalf of workers even if they do not want to bring a claim themselves.
• The FWA will provide legal assistance for employment cases and the costs may be recoverable from the losing employer if the case succeeds.
• The FWA will have the authority to pursue employers for unpaid holiday pay and sick pay and the ability to impose financial penalties on top which would be paid direct to the Government.
• The FWA would also have the remit for punishing modern slavery offences.

These amendments have the power to fundamentally reshape employment litigation. Employers who previously relied on employee reluctance to claim due to risk, affordability, etc may now find the Fair Work Agency stepping in instead. The risk is there at least.

Currently national minimum wage enforcement sits with HMRC. The Gangmasters and Labour Abuse Authority deals with modern slavery. The Employment Agency Standards Inspectorate deals with agency workers. These three bodies would be merged into the FWA.

The FWA would also take on the powers of the director of Labour Market Enforcement, including the power to levy financial penalties on employers who fail to pay employment tribunal awards.

The enforcement of other employment rights may be added to the FWA’s remit during the Bill’s passage through Parliament. Future regulations would be required to implement these. There is even talk that this could result in matters such as discrimination and family friendly rights falling under the FWA.

The FWA will have extensive powers to:

• demand documents or information;
• enter business premises to examine, seize and retain documents or check any equipment used to process or store information;
• request that ‘Labour Market Enforcement Undertakings’ are provided, for example an offence under the NMW legislation.

We may not know the real significance of the FWA for some time to come. It is not expected to be running for some time yet (up to a couple of years). Ultimately the effectiveness of the FWA will depend on the how much resource and funding the Government is prepared to commit. We shall see.

The Government’s online factsheet can be found here.