For UK construction companies, 2026 brings big changes in how employers must follow the rules. The old way of doing things with just a simple agreement is ending. A new agency called the Fair Work Agency (FWA) starts on April 6, 2026. Also, fines for immigration problems have become much higher. Construction sites are now a main focus for strict checks.
If you are a site manager or company boss, you cannot say “I did not know” anymore. Inspectors can come without warning. They can do joint checks with different agencies. They can even take away important tax benefits right away. The money risks are very high now. This guide explains the four main areas of compliance for 2026. Every company needs to understand these to pass an inspection.
The Fair Work Agency (FWA) & Multi-Agency Inspections
The Fair Work Agency (FWA) is a new strong regulator for work rules in the UK. It starts on April 6, 2026. It takes over jobs from other groups like HMRC’s minimum wage team, the Gangmasters and Labour Abuse Authority (GLAA), and the Employment Agency Standards inspectorate.
- What the FWA Does The FWA is the main regulator for 2026. It can check problems with holiday pay, sick pay, and minimum wage without waiting for someone to complain. It has strong powers to investigate on its own.
- Joint Responsibility A big change in 2026 is joint and several liability. This means main contractors can pay fines for mistakes in wages or tax made by their subcontractors. Even if the problem is down the supply chain, the main company can be responsible.
- Checks in High-Risk Sectors Construction is seen as a high-risk area. You can expect surprise visits called “blitz” inspections. The FWA, Health and Safety Executive (HSE), and Home Office may come together to check the site at the same time.
- Worker Classification FWA inspectors can decide on the spot if a self-employed worker is really an employee. They look at how the person works every day. This can happen without going to court first.
These changes make inspections more common and tougher. Companies need good records to show they follow the rules.
Also Read: UK Construction Companies Face New Employer Compliance Inspections in 2026
Right-to-Work & Immigration Penalties (2026)
The Home Office has made big increases in fines. These started in recent years, with the highest fine now £60,000 per illegal worker for repeat problems. First mistakes can cost £45,000 per worker. These rules target industries like construction with many freelance workers.
- Supply Chain Checks You must check the right to work for everyone on your site. This includes workers from agencies, umbrella companies, or online platforms. The responsibility goes through the whole chain.
- Digital Checks Only Old paper passport checks are no longer enough for many workers. From 2026, most non-British or non-Irish workers use the eVisa system. You must use the Home Office online share code to check. This gives you protection from fines if done correctly.
- Sponsor Licences If your company sponsors skilled workers, expect stricter checks. Inspectors look if workers get the right pay and do the jobs listed on their visa.
Construction sites often have workers from many places. Good digital records are key to avoid huge fines.
CIS & Tax Compliance (2026 Changes)
HMRC is now stricter with the Construction Industry Scheme (CIS). They act faster on problems.
- Gross Payment Status (GPS) HMRC can take away GPS right away if they think there is fraud or big mistakes. There is no longer a 90-day warning. If lost in 2026, some rules make it harder to get back, and there can be long waits.
- Monthly Returns From April 6, 2026, you must send a nil return every month if you pay no subcontractors. If not, fines start and grow.
- Fraud Penalties New rules allow a 30% penalty on tax if directors should have known about fraud in payments. This can hit company leaders personally in bad cases.
These tax rules affect cash flow a lot. Many construction firms rely on GPS. Keep all records clean and up to date.
Employment Rights & Worker Classification
New laws from the Employment Rights Act make big changes in 2026. These affect pay and rights from the first day of work.
- Sick Pay Changes From spring 2026, Statutory Sick Pay (SSP) starts from day one of illness. No more waiting days. You need exact records of absences to prove you pay correctly.
- Dismissal Rights Unfair dismissal rights start earlier now. Good records of worker performance are needed, even in short probation times.
- Agency Worker Documents Every agency worker must get a Key Information Document (KID). It shows pay, deductions, and company details. Inspectors will ask to see these on site.
- False Self-Employment The FWA looks closely at Supervision, Direction, and Control (SDC). If a worker is told exactly how to do the job, not just what to do, they may be reclassified as an employee. This brings extra costs.
These rules make worker status very important. Wrong classification can lead to back pay and fines.
Strategy Tip for 2026 Site Managers
To pass a multi-agency inspection in 2026, keep one main digital folder for every person on site. Include their right-to-work check results, KID if needed, and any assessments for self-employed status. In 2026, you cannot blame the agency anymore. You need your own proof.
Good systems help spot problems early. Train your team on new rules. Regular checks inside your company can prepare you for official visits. Construction work is hard, but following these rules keeps your site safe and legal. Start preparing now to avoid problems later.
Would you like me to make a “2026 Site Inspection Readiness Checklist” for construction site supervisors?
Disclaimer: This information is based on reports available as of January 2026. Always check the latest from official sources like GOV.UK, HMRC, or the Fair Work Agency before making decisions.