Top 5 recent workplace developments – July 2026

Stay informed with our roundup of the latest employment law developments.

1. Holiday pay enforcement: Fair Work Agency

The government is consulting on plans to give the Fair Work Agency (FWA) powers to enforce compliance with statutory holiday pay requirements.

The FWA, which was established in April 2026, is intended to act as a central employment rights enforcement body, bringing together a number of existing functions and enforcement powers. Under the Employment Rights Act 2025 (ERA 2025), the government has the ability to extend the FWA's remit to include holiday pay, moving enforcement beyond the current system under which workers generally have to bring their own tribunal or civil court claims to recover any underpayments.

The consultation seeks views on how the new holiday pay enforcement regime should operate in practice. Key proposals include:

• Limiting the FWA's role to enforcing compliance with statutory holiday entitlement. Any enhanced contractual holiday entitlement over and above the statutory minimum would be outside its scope.
• Allowing the FWA to pursue holiday pay underpayments going back up to six years. This would align with employers' obligation to retain holiday records for six years. However, enforcement action could only relate to underpayments arising from 18 December 2025 onwards, when the ERA 2025 received Royal Assent.
• Introducing a naming scheme under which employers found to have underpaid holiday pay could be publicly identified, similar to the existing naming arrangements for NMW breaches.

If implemented, the proposals would represent a significant shift in the enforcement landscape, giving a state enforcement body proactive powers to enforce holiday pay compliance rather than relying solely on individual workers to bring claims. The consultation closes on 22 September 2026.

Practical point

Although the FWA's holiday pay enforcement powers are not yet in force, employers should consider reviewing their holiday pay calculations, record-keeping practices and payroll processes now. Given the proposed six-year look-back period and the possibility of public naming for non-compliance, identifying and addressing any issues before the new regime is implemented could help reduce both financial and reputational risks.

2. Immigration: Right to work checks expanded

The obligation to carry out right to work checks will expand beyond employees to a much wider range of working arrangements from 1 October 2026.

The new regime will extend right to work obligations beyond traditional employment relationships to cover a wider range of working arrangements, including workers engaged under worker's contracts, individual sub-contractors in relevant contracting chains and service providers matched with clients or customers by online matching services. The reforms are aimed at modern working arrangements, including gig work, zero-hours arrangements, subcontracting and platform-mediated services. In some circumstances, liability may extend beyond the organisation with the direct contractual relationship with the individual.

The Home Office has also published a draft updated Code of Practice setting out how the expanded regime is expected to operate in practice.

While the Home Office will generally seek to identify the organisation with the direct contractual relationship with the worker, liability may extend further up the labour supply chain where the direct employer cannot be identified or prescribed compliance requirements have not been met. However, the government has made clear that genuinely self-employed individuals operating a business on their own account and contracting directly with clients or customers will remain outside the scope of the regime.

Practical point

Businesses that engage workers, sub-contractors, gig or platform workers, or labour through supply chains will need to understand which arrangements may be caught by the expanded regime and, for those that are, make sure the right checks and contractual protections are in place.

With civil penalties at up to £45,000 per illegal worker for a first breach and £60,000 for a repeat breach, businesses should use the period before October 2026 to update their processes and train relevant HR, procurement and other teams.

For more information, please see our detailed update.

3. Trade union access rights: What employers need to know

From 30 October 2026, Unions will be able to seek access to workplaces with over 21 employees.

In our Top 5 for April 2026, we explained that the Employment Rights Act 2025 sets out a process for trade unions to seek a right of access to employer’s workplaces to engage with their workers in person or digitally, to meet, support, represent, recruit, or organise workers and to facilitate collective bargaining.  If the union and employer cannot reach agreement, then the Central Arbitration Committee (CAC) can step in to determine access rights. 

This means that access rights can be sought, whether or not the employer already recognises a union, so it is particularly relevant for employers with limited or no previous union engagement.

Plans to implement these union access rights from 30 October 2026 have now advanced a step, with the Government presenting a finalised Code of Practice to Parliament on 6 July 2026 for approval and publishing two sets of Regulations.  

The key points to know are that:

• Unions can seek to access most workplaces on up to a weekly basis, digitally or physically, if the employer employs more than 21 employees nationally.
• An agreement can be reached voluntarily, via the statutory process, or imposed by the CAC in the event of disagreement.
• Employers have 15 working days to respond to an access request and then another 25 days to reach an agreement with the union.
• Breaching an agreement can be expensive: the CAC may impose penalties of up to £75,000 for a first breach, £150,000 for a second breach under the same access agreement, and £500,000 for any third or subsequent breach.

Practical point

• Prioritise workplace relations and communication via employee networks and information and consultation forums as this can make external unions less attractive.
• Ensure your organisation is ready for a quick response by identifying now who will own access requests internally, such as HR, legal or management, and prepare standard response templates.
• Map relevant worker populations, sites, hybrid arrangements, communication channels and any existing union arrangements.
• Train managers not to obstruct lawful union activity – look out for our forthcoming podcast for more information.

4. Vicarious liability

The Court of Appeal has confirmed that a business will not usually be vicariously liable for torts (delicts in Scotland) committed by employees of a genuinely independent contractor.

Mr Burger was restrained by door supervisors outside a JD Wetherspoon pub and suffered a dislocated hip. The door supervisors were employed by Risk Solutions, an independent security contractor engaged by JDW to provide security services at the pub. The question arose about who was liable for the injury.

The County Court found JDW vicariously liable, but the High Court overturned that decision and the Court of Appeal agreed. The key point was that Risk Solutions was carrying on its own independent business: it employed and managed the door supervisors, provided their uniforms, determined staffing, retained responsibility for direction and control, and was contractually responsible for the security services.

The Court of Appeal said that rather than asking whether the relationship was “akin to employment”, the question was whether the contractor was a true independent contractor.  In this case, as evidenced by the fact that Wetherspoons did not pay the staff directly, Risk Solutions provided training and uniforms to the staff and ultimately, there was no substantial transfer of control and responsibility from Risk Solutions to JDW.

Practical point

This case highlights how beneficial it is to have a clearly defined contract, which also reflects the day-to-day realities of how that contract is run:

• Contracts should define the contractor’s responsibility for recruitment, training, supervision, discipline, staffing levels, uniform/PPE and insurance and appropriate indemnities; and
• End users like JDW should avoid managing contractor staff as if they are employees and should ensure instructions are given to the contractor, not directly to its staff, and periodically check that the arrangements on the ground match the contract.

Burger v Risk Solutions BG Limited, J D Wetherspoon Plc

5. Unfair dismissal: Contributory Conduct

The Employment Appeal Tribunal has provided useful guidance for employers on contributory conduct and reinstatement in unfair dismissal cases.

The employee, a warehouse worker with DHL, raised a grievance after being unsuccessful in his application for an administrative role. During the grievance process, he posted details of the grievance on Facebook and posted additional comments criticising DHL and referring to colleagues and managers. Following an investigation, he was dismissed for gross misconduct.

The Tribunal found the dismissal unfair, noting he had not received, or been trained on, the social media policy and there was little evidence that the posts had caused reputational damage to DHL. It ordered that he should be reinstated in his role and reduced his compensation by 10% for contributory conduct.

On appeal, the EAT found that the Tribunal had applied the wrong approach to reinstatement. It had failed to consider whether the employee's conduct during the litigation had led DHL to genuinely and rationally conclude that it had lost trust and confidence in him. The EAT therefore remitted this issue to the Tribunal for reconsideration.

The EAT also clarified when compensation may be reduced for contributory conduct:

• A Tribunal may reduce the basic award where the employee engaged in culpable or blameworthy conduct before dismissal and it is just and equitable to make a reduction. It is not necessary for the conduct to cause or contribute to the dismissal, or for the employer to have known about it at the time of dismissal.
• A Tribunal must reduce the compensatory award where the employee's conduct caused or contributed to the dismissal. The conduct must therefore have been known to the employer and taken into account when deciding to dismiss and can include conduct occurring between dismissal and the conclusion of an internal appeal.

Practical point

The correct test, when determining whether reinstatement is practicable where the employee has contributed to their dismissal, is whether, having regard to that contributory conduct, the tribunal considers it would be just to order their reinstatement.

This case also highlights the importance for employers of demonstrating they genuinely and rationally believe there has been a breakdown in trust and confidence to avoid an employee being reinstated.

DHL Services Limited v Ignatowicz