02 July 2021
A new single enforcement body to protect employment legal rights of workers will impact employers, recruitment businesses and umbrella companies.
Single Enforcement Body (SEB)
The government has announced it will create a single enforcement body (SEB) to protect vulnerable workers and ensure their employment legal rights are protected. The SEB will combine the current enforcement activity undertaken by HMRC, the Employment Agency Standards Inspectorate and the Gangmasters and Labour Abuse Authority. It will have robust enforcement powers to deal with those employers, recruitment businesses and umbrella companies that are not complying.
What employment rights will the SEB protect?
The SEB will tackle shortfalls in National Minimum Wage (NMW), holiday pay and sick pay and Modern Slavery Act statement reporting. It will ensure vulnerable workers receive their entitlements without facing a lengthy and costly tribunal process. It will also protect agency workers by regulating umbrella companies that employ them and are responsible for payment, but don’t fall within the remit of the Employment Agency Standards Inspectorate. The SEB will also take action against businesses that turn a blind eye to abuse in their supply chains.
What are the consequences of non-compliance?
Employers could be liable for fines of up to £20,000 per worker and also risk reputational damage through public naming and shaming.
What should employers be doing now?
It is not yet clear exactly when the new SEB will be introduced, but it is expected in a new Employment Bill which the Department for Business, Energy and Industrial Strategy (BEIS) indicated would be the “vehicle that will bring the single enforcement body together”.
For now, employers, recruitment businesses and umbrella companies should audit their current practices, and those of their labour supply chain, on NMW, holiday pay, statutory sick pay and modern slavery statements to ensure they are legally compliant, while keeping an eye on the developments with the new SEB