Any small business that pays hourly rates or manages shift workers should take note: enforcement of the National Minimum Wage is about to change hands, and a new government delivery plan sets out how.
East Midlands Chamber has welcomed the Fair Work Agency’s first delivery plan for 2026 to 2027, saying it will help give clarity to employers as National Minimum Wage enforcement moves to the new body. The plan was published on 10 August 2026 and updated on 21 August 2026, and it sets out priorities, actions and performance measures for the agency’s first year of operation.
The Fair Work Agency was formed under the Employment Rights Act to protect workers and enforce minimum standards, covering statutory sick pay, holiday pay and the National Minimum Wage, alongside the wider changes covered in our piece on the zero-hours contract reform crackdown. Responsibility for enforcing minimum wage law is moving to the agency as part of that remit, which means employers currently dealing with HMRC on wage compliance will eventually be dealing with a different body altogether.
Alongside the enforcement transfer, the plan commits the agency to building digital tools intended to make it easier for employers and workers to understand what compliance actually requires. No launch date or detail on those tools has been given yet. Employers weighing whether to hire before the new rules land can see how firms are approaching low-hire, low-fire mode right now.
Richard Blackmore, Director of Policy and Insight at East Midlands Chamber, who also welcomed findings in the Small Business Plan one year on report, said: “It’s good to see publication of the agency’s first-year priorities and focus on protecting workers while supporting compliant businesses.” He added that the Chamber would support employers in understanding their responsibilities as the new arrangements are implemented, and would signpost guidance and training where needed. Retailers navigating other compliance pressure can also read about the crackdown on dodgy shops and what it means for legitimate traders.
What this means for small employers
For most small businesses already paying correctly and keeping proper records, this is a change of process rather than a change of obligation. The rates you owe staff do not shift because a different agency polices them. What does shift is who investigates a complaint, who issues penalties, and potentially how quickly digital checks flag an underpayment.
This lands at a time when many small employers are already reassessing headcount and pay decisions, as covered in our look at firms settling into low-hire, low-fire mode. Tighter, more digitised enforcement adds another reason to get pay and hours records right before a new regulator starts looking.
It also sits alongside other employment law change already worrying small firms, including the zero-hours crackdown that could cost firms £3bn. Owners juggling several strands of employment reform at once may find it worth reviewing broader compliance groundwork, of the kind set out in our piece on what the Small Business Plan found one year on.
What to do now: check that hourly pay, deductions and working time records are accurate and easy to produce on request, since a new enforcement body with new digital tools is likely to make spot checks simpler rather than harder to carry out. Businesses with any doubt about how a worker’s rate is calculated should resolve it before the transfer takes effect, not after.
