UK employers should be aware that a revised Code of Practice on preventing illegal working is due to take effect from 1 October 2026. It reflects legislation that significantly increases the risk of employers receiving an illegal working civil penalty of up to £60,000 per worker – particularly businesses using complex labour supply chains, subcontractors and agency arrangements.

Why This Matters

Right-to-work compliance has always mattered, but the current penalty regime already carries a starting point of £45,000 per illegal worker for a first breach and £60,000 for a repeat breach within three years. The upcoming changes are expected to widen the circumstances in which a business further down a labour supply chain – not just the direct employer – can face enforcement action.

If your business uses subcontractors, agency staff or complex supply arrangements, now is the time to review your right-to-work checking systems, before the revised Code of Practice takes effect.

What Employers Should Do Now

• Review right-to-work checks across your entire supply chain, not just direct employees
• Confirm your HR systems can evidence a statutory excuse for every worker
• Understand the mitigating factors that can reduce a penalty – self-reporting and cooperation can reduce a penalty by up to £5,000 per factor
• Get advice now if you have any concerns about historic compliance, rather than waiting for a compliance visit

If you have already received a civil penalty notice or a compliance visit referral, time limits are strict and every day matters – see our guidance on challenging an illegal working civil penalty or our main Civil Penalty Defence page for the full objection and appeal process.

Last reviewed: July 2026. This article gives general information only and is not legal advice on your specific position. NA Law Solicitors is authorised and regulated by the Solicitors Regulation Authority – SRA No. 645049.