Consultation opens on holiday pay compliance and enforcement

From 2027, the statutory right to holiday pay will be enforced by the new Fair Work Agency (FWA). The consultation focuses on:

• The overall approach the Fair Work Agency should take to supporting and enforcing compliance with holiday pay obligations.
• Providing guidance, tools, and support to help employers understand and meet their legal responsibilities.
• The proposal to allow the FWA to investigate holiday pay claims dating back up to six years, aligning with existing record-keeping requirements.
• Introducing civil penalties for non-compliance, with the Government proposing penalties equivalent to those used in National Minimum Wage enforcement: 200% of arrears owed, up to a maximum of £20,000 per worker, with a minimum penalty of £100.
• How enforcement activity could be targeted to better support lower-paid and more vulnerable workers.
• Gathering evidence on the use of rolled-up holiday pay following recent reforms for irregular-hours and part-year workers.

The consultation does not cover how holiday pay and holiday entitlement are enforced through the Employment Tribunal, nor on issues such as how holiday pay is calculated. 

The Government is encouraging responses from employers, workers, trade unions, representative organisations, and other stakeholders with an interest in employment rights and holiday pay compliance. Feedback will help shape how the new enforcement regime operates in practice.

Responses can be submitted online, by email, or in writing before the consultation closes on 22 September 2026. You can view the consultation on the UK Gov website (opens as an online PDF).