24 June 2026

Businesses operating across the UK face a significant expansion of the right to work compliance framework in October 2026 as part of the government’s drive to prevent illegal working. The new legislation shifts the burden of preventing illegal working further onto businesses across all sectors, including the gig economy, with significant financial civil penalties and criminal sanctions for non-compliance.

Following the recent change to the Labour leadership some elements of the government’s legislative agenda may change. However, there is currently no indication that the expanded right to work checks legislated for in the UK Border Security, Asylum and Immigration Act 2025 will be prevented from coming into force.

There are proactive steps businesses can take now to ensure they are prepared for these changes which will necessitate a thorough review of current workforce right to work practices. The more that can be done now,  the better able businesses will be to demonstrate compliance and minimise the financial and operational risks of breaches.

What does right to work legislation currently require?

Currently, all employers have a responsibility to prevent illegal working.  This is demonstrated by checking the status of every employee before they begin work, to confirm that they have the right to work in the UK and to do the specific work they are being hired to do.  Compliant right to work checks will provide a statutory defence against illegal working that may occur and should be completed on all employees in a non-discriminatory manner.

Although this statutory defence currently only applies to a business’s direct employees, Home Office sponsor licence holders must also check the right to work of self-employed sponsored workers to comply with their sponsorship duties and not risk licence revocation.

What will change under the proposals?

The new legislation extends the requirement to conduct right to work checks to a far wider range of working arrangements, including:

• self-employed workers
• contractors
• sub-contractors
• freelancers
• agency staff
• consultants
• ‘gig economy’ workers who provide services for your business to customers
• partners in Limited Liability Partnerships

The change is in part aimed at reducing illegal working and exploitation in the gig economy and amongst freelancers and contractors, particularly in informal working arrangements or those facilitated by online platforms.

What does this mean for businesses?

This expansion of the right to work regime adds significant operating challenges and costs for businesses’ HR functions and preparation for these should have Board-level oversight.

As checks will now be required for a potentially very wide variety of workers, HR teams will need to spend more time clarifying which workers’ fall into scope, undertaking such checks, and ensuring they retain complete records and audit trails..

Right to work and onboarding processes will need to be overhauled, and staff will require training to ensure all working arrangements are carefully considered and the required checks are completed compliantly.  Coordination between HR, procurement and other areas of the business will be necessary to ensure full compliance.There are significant risks if a business fails to undertake the required checks on a worker who is caught illegally working, including civil penalties and criminal sanctions. Currently, employers who are found to be employing someone without the required right to work will be subject to a maximum civil penalty of £45,000 (for a first breach) or £60,000 (for subsequent breaches) if they have not undertaken a valid right to work check. Knowingly employing someone illegally (or having ‘reasonable cause to believe’ that an employee does not have the right to work) can also carry criminal sanctions, including a prison sentence and/or an unlimited fine.

Businesses that hold sponsor licences can have their licences revoked in cases of failure to conduct checks.  Licence revocation has far reaching consequences including the cancellation of all sponsored migrants’ immigration permission and an inability to sponsor further overseas workers which can cause huge disruption to recruitment pipelines and business functions. There is of course also the reputational damage associated with such failures.

The risks are compounded by an increasingly digitised and efficient Home Office enforcement regime. Where previously the Home Office would normally have to physically visit a business’s premises to detect wrongdoing, increasingly the Home Office is interrogating automated records to do so – for example, cross-checking HMRC PAYE records against Home Office data and flagging cases where they suspect employees may be working illegally. In such a regime, even minor irregularities may invite scrutiny and swifter enforcement action. There is increasingly ‘nowhere to hide’ for non-compliant businesses. Compliance with right to work requirements is therefore non-negotiable with this increased risk affecting a wider workforce.

What should employers do to prepare?

There are practical steps businesses can take now so they are ready for the new regime. This preparation may be essential mitigation evidence in the event of enforcement action.

For all employers, the focus is increasingly on demonstrating a coherent and auditable compliance strategy across recruitment, onboarding, contractor engagement and tracking and monitoring migrant workers’ right to work.

• review engagement models and implement a decision-making framework to identify which work streams and workers may fall into scope from October.
• liaise with suppliers and agencies to ensure compliance through supply chains.
• review and update existing contracts with suppliers and contractors to include new right to work requirements and indemnities (subject to employment law advice) and ensure procurement managers are aware of the new requirements so contractual service agreements comply with the new requirements
• update processes and systems, including your tech and onboarding systems to align with new requirements
• train staff (HR and recruiting managers as a minimum) so they are familiar with the new requirements and know how to conduct non-discriminatory right to work checks on all relevant workers
• businesses that use sub-contractors and allow substituted workers will have enhanced obligations and need to pay close attention to written employment particulars to establish a statutory defence against illegal working.
• conduct a mock audit of current right to work compliance to identify vulnerabilities in advance of the roll-out of the new regime.
• maintain robust recordkeeping to demonstrate compliance.

When will we know more?

More details regarding the expanded regime are likely to be published in a code of practice which we hope will provide greater clarity on some of the unclear aspects such as where liability rests in complex supply chains.  This should assist businesses in preparing for the full rollout of the expanded regime, expected in October 2026.

Get in touch

For further advice on these changes, contact Laura Devine Immigration at enquiries@lauradevine.com.