New Right to Work Rules and the Building Safety Levy: What Construction Firms Need to Know

October has brought two significant changes for the UK construction sector. Right to Work checks have been extended to cover self-employed and non-standard labour. A new Building Safety Levy now applies to larger residential schemes in England. Both took effect on 1 October 2026, and both have practical implications for how contractors hire and plan.

Right to Work checks now reach beyond employeest

Until now, statutory Right to Work checks applied mainly to people employed under a contract of employment. That has changed. The Border Security, Asylum and Immigration Act 2025 extends the requirement to a much wider range of working arrangements. These include workers, individual subcontractors in contracting chains and labour supplied through other routes.

For construction, which relies heavily on self-employed labour, this is a major shift. Contractors engaging individuals directly must now confirm those people are legally entitled to work in the UK before they start. Ministers have also named construction as a high-risk sector for Home Office enforcement.

Not every self-employed person is caught. Government guidance makes clear that genuinely self-employed people running their own business and contracting directly with clients sit outside the regime. But calling someone a "contractor" or "self-employed" doesn't automatically take them out of scope. What matters is how the arrangement actually works.

Liability up the contracting chaint

The new rules also introduce extended liability. Main contractors could face penalties if illegal workers are found further down the chain and the required contractual safeguards weren't in place. In practice, we expect this to mean:

Tighter subcontract terms requiring compliant checks at every tier More rigorous labour onboarding Closer control over who actually turns up on site

Firms need clear records showing who carried out each check, when it was done, and that the person arriving on site is the same person who was cleared. Home Office guidance suggests controls such as site passes, attendance systems, biometrics and regular identity checks. If you use a digital checking provider, it must now be registered for Right to Work checks on the Government's OfDIA register.

The penalties

The penalties are steep:

Up to £45,000 per illegal worker for a first breach Up to £60,000 per worker for repeat breaches In serious cases, business closure, director disqualification, unlimited fines and prison sentences of up to five years

The Building Safety Levy

Also from 1 October, developers in England face a new Building Safety Levy. It applies to building control applications for schemes of 10 or more homes and to purpose-built student accommodation of 30 or more bedspaces. The levy is expected to raise around £3.4bn over roughly ten years to help pay for remediating unsafe residential buildings.

The charge is calculated per square metre, and rates vary by local authority to reflect local property and land values. As a guide, a 10,000 sq m residential scheme would pay roughly:

£284,000 in Manchester £292,000 in Birmingham £612,000 in Tower Hamlets

Some schemes pay less or nothing:

Brownfield developments receive a 50% discount. Affordable housing and a range of community and specialist accommodation are exempt. Schemes below the 10-home or 30-bedspace thresholds don't pay. Applications submitted before 1 October are protected.

What this means for hiring

For contractors and M&E firms, both changes add cost and compliance pressure at a time when skilled labour is already hard to find. The Right to Work changes in particular will affect how quickly people can be mobilised onto site. Compliant checks and clean records are now a commercial necessity as well as a legal one.

At Talentometry, we carry out Right to Work checks as standard on every candidate we place. If you'd like to talk through how these changes affect your hiring plans, get in touch.

This article is for general information only and isn't legal advice. Firms should take professional advice on their own arrangements.