On 30 June 2026, the DBT launched Consultation: Holiday pay compliance and enforcement, seeking views on the government's proposed approach to holiday pay compliance and enforcement by the Fair Work Agency (FWA). The consultation closes on 22 September 2026.
The statutory right to holiday pay is expected to be enforced by the FWA from 2027. State enforcement is intended to complement the employment tribunal system and provide an accessible, timely and effective route to resolution. The government invites views on:
- the general proposed approach, as set out in the consultation document, regarding holiday pay compliance and enforcement;
- what support and guidance the FWA could provide to help support compliance; and
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- important design features of the framework, including:
- how compliance and enforcement should be targeted (the government seeks views on how the FWA could target compliance and enforcement interventions to support lower-income workers and workers in more vulnerable or precarious employment);
- important design features of the framework, including:
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- how far back the FWA can enforce claims (the government proposes the FWA investigate holiday pay claims up to six years in the past); and
- how penalties should be set (the government proposes the default settings enabled through s 107 Employment Rights Act 2025, ie a penalty of 200% of arrears owed to workers, a maximum penalty of £20,000 per worker and a minimum penalty of £100).
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The consultation also invites views on the current practices around rolled-up holiday pay.
For further information on the ERA 2025 generally, see ERA 2025: Desktop.
First published on the Employment News Service on 30 June 2026
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