Current Right to Work Framework
To comply with their obligation to prevent illegal working in the UK, employers must carry out right to work checks on individuals before employment commences, in the prescribed manner set out in Home Office guidance. Where an individual has an unrestricted right to work in the UK, the employer establishes a continuous statutory excuse. Where that right is time-limited, only a time-limited excuse is established, requiring a follow-up check to be carried out to maintain that protection. A compliant check establishes a statutory excuse against civil liability for illegal working.
The consequences of getting this wrong are serious. Where illegal working is found and no statutory excuse exists then employers face civil penalties of up to £60,000 per illegal worker. Where the employer has reasonable cause to believe that illegal working is being carried out then there can also be criminal liability. This can include an unlimited fine and/or up to five years' imprisonment for individuals within the business.
How will the Right to Work Framework be extended?
Section 48 comes into force on 1 October 2026 and fundamentally extends the scope of the right to work regime:
1. Who is captured by the changes?
Three new categories of working individuals are brought within scope. Home Office guidance specifying the details of each category is anticipated ahead of October; however, the duty to check will now also apply to businesses who engage the following categories of individuals:
Workers' Contract: broadly capturing individuals working under a contract for services or for the provision of labour, extending beyond the traditional employment contract, such as directly engaged individual contractors and consultants.
Individual Sub-Contractor: an individual engaged by a contractor rather than directly by the end-user business, typically as part of a supply chain arrangement.
Online Matching Service: individuals engaged through digital platforms or marketplace-style services, covering gig economy and platform-based arrangements e.g. taxi and food delivery services
The draft Code confirms that genuinely self employed individuals, running their own independent business and contracting directly with clients or customers, remain outside its scope.
2. Who will be liable?
Civil penalty liability is moving up the supply chain. Under the current framework, liability rests primarily with the employer holding the direct contractual relationship with the worker. From October 2026, that liability will extend through the labour supply chains. A business may face exposure even where it has no direct contract with the individual carrying out the work. This represents a material increase in risk for any business that relies on agency labour, contractors, sub-contractors or platform-based workers.
What does this mean in practice?
For many businesses, the immediate effect of Section 48 will be a significant increase in the volume of individuals requiring right to work checks and, where rights are time-limited, ongoing monitoring. Businesses should begin taking the following actions:
- Audit your workforce first
- Review and map all the ways in which work is engaged and right to work checks are carried out across your business in light of the proposed changes, identifying risk hotspots and opportunities to improve.
- Under the draft Code, where a right of substitution is allowed, any substitute must be subject to right to work checks before they begin performing services. Businesses should not depend on the original worker to determine a substitute’s right to work. Employers must also have proportionate identity verification processes to confirm that the individual actually doing the work is the same person whose right to work has been verified. Examples include identity cards or workplace access passes, cross-checks against training records, and periodic re-verification of identity.
- Once you have a clear view of who falls within scope, you can assess risk more accurately, prioritise remedial action and design compliance processes that are proportionate to those risks.
- Review contracts with labour suppliers and agencies
- Home Office draft guidance indicates that specific clauses should be included in supply chain agreements to address right to work compliance obligations and information-sharing requirements.
- Where a person supplies work or services via another employer or an online matching service, there must be a written statement in place before work starts. It must require prescribed right to work checks on individuals, restrict further subcontracting without prior written consent and replicate equivalent obligations on right to work checks on any permitted subcontracting arrangement, permit audits, and allow enforcement (including suspension/termination) where illegal working is found and no statutory excuse exists. These requirements can apply across multiple tiers in a contractual chain, with liability for illegal working assessed on a case by case basis depending on how arrangements operate in practice.
- Existing contracts and arrangements (including the existence and parameters of any warranties and indemnities in place) should be reviewed as soon as possible.
- Scale your checking processes. Assess whether your current right to work checking infrastructure (including any use of Identity Service Providers (IDSPs) for digital checks) can handle the volume and variety of checks that will be required from October. Investment in compliance technology may be warranted, and internal training will need to be updated to reflect the new categories and obligations.
October 2026 is closer than it appears. Businesses that begin this work now will be significantly better placed than those waiting for final Home Office guidance before they start.
Contributors to this article were Sajida Hussain and Amy Clarke
