Labour's new Fair Work Agency has sparked fierce debate after being granted sweeping powers to arrest suspects and use "reasonable force" under the Employment Rights Act, earning it the nickname "jobs police". The agency, championed by Angela Rayner before she stepped down as Deputy Prime Minister last year, marks one of the most significant overhauls of workplace rules in a generation.

Speaking at the Labour Party Conference in Liverpool in 2023 prior to the general election the following year, Ms Rayner said: "We will end the race to the bottom by creating a single enforcement body with the teeth to ensure that rights are not just words on a page, but a reality for every worker."

According to government documents, officials within the body can conduct surprise inspections and enter premises without consent by obtaining warrants under the Police and Criminal Evidence Act 1984.

They are further authorised to search individuals, seize materials and detain those suspected of labour market offences. Force may be used "where reasonable and necessary" to enforce the new laws.

The Fair Work Agency (FWA) is tasked with upholding a wide range of protections, including minimum wage compliance, modern slavery regulations, holiday entitlement and sick pay. It can issue financial penalties to non-compliant employers and even bring tribunal cases directly on behalf of workers.

Ministers have also directed the agency to review areas where "legislative, operational or strategic changes may be required" and to explore potential expansion of its remit in the future. Powers of arrest and "reasonable force" will apply in the case of "Labour Market Offences"-serious crimes such as modern slavery, human trafficking or severe forced labour.

This enhanced authority comes with a substantial price tag. The FWA has been allocated an annual budget of £60.1 million - more than £12 million higher than the combined funding of the predecessor bodies it replaces.

Officials argue the increase is necessary to reflect the additional regulations introduced by the Employment Rights Act. The changes are projected to benefit more than 15 million workers, roughly half the UK workforce.

Key reforms include day-one entitlement to sick pay and a simplified process for unfair dismissal claims. Supporters say the agency will create a level playing field by targeting rogue employers who undercut law-abiding businesses.

However, business leaders have raised serious concerns about the scale of the new powers, with some dubbing the agency the "jobs police".

Alex Hall-Chen from the Institute of Directors warned: "The Fair Work Agency already possesses significantly broader authority than its predecessors, including the ability to enter premises."

She suggested the push for remit expansion "could extend its powers beyond its original purpose without proper scrutiny or consultation with business".

Tina McKenzie of the Federation of Small Businesses echoed these worries, noting that small firms are already navigating major changes from the Employment Rights Act.

Tina McKenzie said: "What they need from the Agency right now is clear guidance and compliance support and not the prospect of a broader enforcement reach down the line."

With the tribunal system facing a record backlog, she urged prioritising basics over expanded enforcement.

Shadow Business Secretary Andrew Griffith was more scathing. He told GB News: "The remit letter simply confirms it will inevitably seek to add more staff and more red tape, raising unemployment still further. This is clearly a blank cheque to expand its powers."

He pledged that a future Conservative government would scrap the "unwarranted body" and give its staff "first-hand experience of finding a new job".

The agency will be led by former Stonewall board member Lisa Pinney. A government spokesman defended the creation of the FWA, describing it as "simply bringing existing powers into one place to ensure businesses know where to turn and spend less time on bureaucracy."

The spokesman added that the body is designed to act against rogue employers while supporting the vast majority who play by the rules.