The umbrella company landscape is entering a period of major change. With new and changing obligations on the horizon for recruitment businesses, including critical changes to legislation coming into force in April 2026, now is the time to prepare. To support you through this transition, the REC has launched an Umbrella Company Hub: your go-to source for updates on these changes as more details emerge, with clear and insightful information and guidance on what these changes mean for your business and what you can do to prepare for them. 

On the 12^th of June, HMRC updated its Current list of named tax avoidance schemes, promoters, enablers and suppliers. Hive Umbrella Ltd was added to the list a few years ago and HMRC took action against Hive in respect of the Disclosure of Tax Avoidance Schemes (a scheme that obliges certain parties to give advance notice to HMRC that a tax arrangement could create a tax advantage). Hive created a ‘bonus scheme’ and ‘loan arrangement’ for contractors to be paid by – the effect of which was that there was an underpayment of PAYE, as the ‘loan’ payment would not have been taxable. The case was heard in the First-Tier Tribunal Tax Chamber and the judgment can be found here. This case is a good reminder for members who use umbrella companies of the importance of rigorous due diligence, especially given the changes which are coming into force in April 2026. More information on the changes can be found here.

The amendments to the Employment Rights Bill were announced on 4th March 2025. Further information on the amendments can be found here. Our most recent publication on changes to statutory payments under the ERB can be found here. We recently hosted a webinar on the ERB which included updates for the REC campaigns and legal teams. The recording can be found here. On 1st July 2025, the government published the Roadmap on Implementing the Employment Rights Bill which sets out when different provisions contained in the Bill are scheduled to come into force.

The DBS have updated their Update Service guidance to add the fact  that, before carrying out a status check, employers must see the applicant’s original paper certificate in person. At the end of April 2025, the DBS had also updated their ID checking guidelines for Standard/Enhanced DBS check applications.

The Legal Team has received an increase in queries regarding AWR. Please see our Legal Guide on AWR and our FAQs on the Agency Worker Regulations (AWR) 2010.