The new right to work regime: what you need to know

The UK government is expanding the scope of the right to work (RTW) regime with effect from this month, and the construction industry is likely to be among the most affected given its longstanding reliance on subcontracting, labour-only arrangements and multi-tier supply chains. 

Historically, businesses only had to worry about right to work checks in respect of employees but, for the first time, the regime extends beyond traditional employment relationships to capture a much wider range of working arrangements. In practical terms, portions of the site workforce that have historically sat outside formal right to work procedures may now need to be brought within them.

The Home Office has published a revised code of practice and an updated employer’s guide to right to work checks, setting out how the new regime is expected to operate.

Not just direct employees

From 1 October 2026, construction employers and principal contractors are required to conduct right to work checks not only for direct employees but also for casual and zero-hours workers, individual subcontractors engaged through labour-supply arrangements, and workers sourced through digital platforms or matching services used to fill site vacancies. 

For many firms, this brings entirely new categories of site labour into formal checking processes for the first time. 

Under the new regime, liability may reach upstream in a chain of contracts

The Home Office guidance confirms that there are still certain limits to the extension of the right to work regime. Genuine business-to-business arrangements, such as a client contracting directly with an individual’s own personal service company for services performed independently, will generally fall outside the regime, provided the substance of the arrangement, rather than its label, supports that conclusion. 

However, the guidance also makes clear that employers and businesses should consider their recruitment and onboarding processes in light of their operating models, and may wish to seek legal advice where uncertainty arises. 

A key change is the introduction of the concept of an extended liability. Previously, right to work compliance rested with the direct employer. Under the new regime, liability may reach upstream in a chain of contracts, meaning a main contractor or developer could, in certain circumstances, bear responsibility for illegal working further down its supply chain.

The draft guidance gives the example of a developer that wins a contract to build new homes and, in turn, engages businesses through a chain of contracts to supply the workers needed. In that scenario, although it is not directly engaging the workers itself, the developer would fall within the scope of the extended liability regime. 

While certain exemptions apply, including where a business is acting as an end user purchasing services for its own operations and not under contract to a third party, the guidance makes clear that whether liability applies will depend on the specific facts of the case and the contractual arrangements. 

The construction sector’s traditional labour model, characterised by layered subcontracting, extensive use of self-employed tradespeople and reliance on subcontractors to supply workers to site, sits squarely within the intended scope of these reforms and creates a number of practical challenges. 

Scrutinise your supply chain

Main contractors and developers need to look beyond their direct contractual relationships and scrutinise too the compliance practices of their subcontractors and sub-subcontractors, since extended liability may reach upstream even where there is no direct relationship with the individual worker. 

Establishing a statutory excuse under this extended liability regime requires upstream parties to have written statements in place before work begins, setting out contractual requirements relating to checks, restrictions on unauthorised subcontracting, audit rights and enforcement measures where illegal working is identified.

Employers must maintain systems to confirm that the individual performing the work is the same one originally checked

Identity verification also becomes more demanding on sites where workers move between contractors. Employers must maintain systems to confirm that the individual performing the work is the same one originally checked. The Home Office guidance highlights examples of controls including identity cards, workplace passes, biometric systems and facial recognition technology. 

Given the transient nature of site-based labour, this means an operational shift. Contractual protections alone will not suffice. The Home Office expects businesses to be able to demonstrate how concerns were identified, investigated and addressed in practice. 

So, what steps do construction businesses need to take? Firms should begin by auditing their workforce and contractual arrangements to identify which relationships now fall within scope, alongside reviewing onboarding processes and revisiting supply chain and subcontracting agreements. 

This is not only about ensuring the prescribed requirements and contractual protections are in place but also about being able to demonstrate that those requirements are being complied with in practice if challenged.

 With civil penalties of up to £60,000 per illegal worker and increased Home Office enforcement activity, the cost of inaction can be high. 

Emily Hasted is a partner at Eversheds Sutherland