The UK government’s recent decision to introduce new umbrella regulations marks a transformative step toward creating a fairer, more transparent temporary labour market. FCSA fully supports these changes, which assign recruitment agencies responsibility for ensuring Pay-As-You-Earn (PAYE) compliance when engaging workers through umbrella companies. This shift will help reduce tax avoidance, level the playing field, and strengthen protections for workers across the industry.
Tackling Bad Actors in the Industry
For too long, unethical, bad-acting companies in this vital sector have dodged compliance, exposing workers to surprise tax liabilities and undercutting legitimate, ethical businesses. With the new regulations set to take effect in April 2026, recruitment agencies will now need to conduct rigorous due diligence checks on their umbrella partners to ensure full PAYE compliance. FCSA believes this is a very positive step which will ensure the integrity and transparency of the entire supply chain, making it difficult for non-compliant operators to win business and will go a long way to help stamp out abuses.
Advocacy for Strengthened Regulations
“These new regulations are a welcome development for the industry and will play a significant role in safeguarding workers and supporting compliant agencies and umbrellas,” said Chris Bryce, Chief Executive of FCSA. “FCSA has long advocated for tighter oversight and regulation to weed out bad actors, and our 700+ point Certification  provides a gold standard of compliance for agencies looking to align with these new rules. Coupled with our market-leading compliance tools, FCSA Certification will continue to be the hallmark of quality”
Tools for Compliance: veriPaye and Diligence Hub
As well as our stringent assessment reviews, we have introduced services to support agencies and umbrellas adapting to these changes, for example FCSA’s veriPAYE and Diligence Hub tools are already in place and are updated on a continuous basis. These are designed to help verify PAYE deductions and mitigate compliance risks for all involved. Agencies can rely on FCSA Certified Members to meet the highest compliance standards, helping to secure the rights of workers and sustain an ethical, fair industry.
Commitment to Strengthening Compliance
FCSA will continue to work with the government to strengthen compliance in the industry and are actively engaging on the forthcoming legislation and details surrounding the proposed new regulations. With these strengthened measures, the sector can look forward to a more secure, compliant future, with protections in place for workers and intermediaries alike, enabling their commitment to integrity across all operations. As always, FCSA stands ready to support agencies, umbrellas, and workers committed to building this brighter future.
