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Under the Employment Rights Act 2025, the government plans to introduce a new Adult Social Care (ASC) Negotiating Body. It will roll out across England with implementation across Scotland and Wales being established by their respective governments.
This Body intends to oversee a "Fair Pay Agreements" will be consulted on once the ASC Negotiating Body is established. This will cover pay, terms and working conditions for adult social care workers.
Introduction of regulations to establish the ASC Negotiating Body are expected during October 2026, it is important for those working in the social care industry to be aware of what this could mean.
If the ASC Negotiating Body is formally established and a Fair Pay Agreements agreed and ratified, it will apply to adult social care workers within the scope of the agreement, despite their current trade union membership status.
In this article we uncover what a Fair Pay Agreement is, how it will impact the adult social care industry and the responsibilities of employers.
What is a Fair Pay Agreement?
A Fair Pay Agreement is a legally binding deal to determine the minimum pay and working conditions standard across a sector. An agreement of this kind is not decided upon by one entity alone; it requires the collaboration of employer groups and trade unions to negotiate the rules and set the standards together.
For Adult Social Care Fair Pay Agreements to be agreed, it requires the creation of a new Adult Social Care Negotiating Body. The Body will have the power to negotiate legally binding minimum standards and oversee wider workforce issues.
The purpose of a Fair Pay Agreement
The main intention of an FPA is to address the ongoing challenges of recruitment and retention across adult social care.
Rather than focusing solely on wages, FPAs will provide a mechanism for employers and worker representatives to negotiate minimum standards for pay, terms and conditions, alongside wider issues such as training and career progression. The aim is to create greater consistency across the sector and support a more stable, skilled, and sustainable workforce.
Who is the Negotiating Body for Adult Social Care?
Once established, the Body is intended to bring together representatives of workers and employers to establish and agree on minimum pay terms that will be binding on all employers and workers as defined by in the Employment Rights Act 2025.
This falls under part of the Employment Rights Act 2025 reforms, with regulations to establish this negotiating body planned to come into effect from October 2026. However, it is important to note that these regulations will enable the establishment of the body, rather than directly introducing Fair Pay Agreements at this time.
The UK government consulted on the design of the process between 30 September 2025 and 16 January 2026 and expects to bring forward secondary legislation to establish the negotiating body for England in October 2026. The first round of negotiations is expected in 2027, with the first Fair Pay Agreement intended to take effect in April 2028.Â
Responsibilities for care workers and business owners
So, what does this mean for businesses operating in the Adult Social Care industry?
A Fair Pay Agreement could result in a major overhaul of current processes. From aligning pay and working conditions with the requirements of a new negotiating body, to impacts on recruitment, retention and budget. Highlighted below is just some of the effects the industry could face:
Changes to pay throughout the industry
Once a Fair Pay Agreement framework comes into effect, worker and employer representatives may be required to negotiate and establish minimum pay terms that will be binding on all employers and workers covered by the agreement. Employers will need to comply with these minimum pay terms once they are agreed, which could lead to increased wage costs.
Industry compliance
Employers will likely need to engage in the negotiation process, either directly or through representatives. This could involve allocating time and resources to participate effectively in discussions and to ensure compliance with the outcomes.
Adjustments to budgets
Employers may need to adjust their budgets to accommodate any potential increases in pay rates set by the FPAs, which could affect overall operational costs.
Simplification of pay structures
FPAs may aim to create uniformity in pay terms across the sector, which could simplify pay structures for some employers but may increase costs for others.
Administrative preparations
Employers will need to stay informed about the specific regulations and ensure their payroll systems and employment contracts are updated to meet the requirements of any FPAs.
Improved employee recruitment and retention
On a positive note, improved pay rates and standardisation could help employers attract and retain staff in a sector that often faces workforce shortages and high turnover rates.
In an ideal world, employers would take preemptive steps now to ensure these changes do not massively impact them.
But how?
What can employers in the Adult Social Care sector do to prepare?
Audit payroll data and processes
A good starting point for any business would be to conduct audits of HR and payroll processes. Ensuring that current processes will not be hindered by prospective changes.
It's important that businesses stay informed about the establishment of the Fair Pay Agreement Adult Social Care Negotiating Body and any updates on its progress. Assess current pay practices and structures to ensure they align with potential new minimum pay standards and reduce the impact this may have on the company budget.
Prepare for workforce consultations
Businesses may need to engage with worker representatives during the development and implementation of Fair Pay Agreements. Ensure that systems are in place to facilitate effective communication and collaboration with employee representatives.
This is important if a business has specific concerns relating directly to regional funding or complex staffing structures. To ensure unique concerns are heard, relationships with trade associations should be developed soon.
Monitor the Government’s announcements
Business owners should keep a vigilant eye on updates and guidance from the government. These changes can quickly catch businesses by surprise, so it's important to stay in the know and ahead of changes.
A good way to do this is to engage with industry stakeholders. Discuss upcoming changes with other organisations in the industry and receive updates directly from industry groups and trade associations.
Ensure compliance with broader employment rights changes
In the meantime, businesses can implement changes to processes to ensure compliance with wider employment law changes. Such as those to SSP and day one rights under the Employment Rights Act 2025.
Will the Fair Pay agreements include NHS workers?
In July 2026, the Department of Health & Social Care confirmed that the proposed Fair Pay Agreements will not apply to Council or NHS adult social care staff.
The ASC Negotiating Body will cover all adult social care workers as defined in the Employment Rights Act 2025, excluding those already covered by other national collective bargaining and pay-setting arrangements, including the NHS Pay Review Body and Agenda for Change (AfC) contract and the National Joint Council (NJC) for Local Government Services, although this exclusion will be reviewed after 3 years.
Fair pay agreements apply to the paid adult social care workforce, and therefore do not cover unpaid carers. There are also parts of the paid workforce that are not within coverage, specifically self‑employed workers and those working under informal care arrangements. This is because they are not covered by the definition of ‘social care worker’ set out in the Employment Rights Act 2025.
Concerned about how the proposed changes will impact your care business?
Despite not having taken effect yet, major changes to pay and working conditions across the private health and social care sector will impact businesses. As an employer in the industry, it's important to stay up to date to ensure your business is informed and prepared.
If you're worried about what Fair Pay Agreements will mean for the sector and the running HR and payroll processes of your business, do not hesitate to reach out to a member of the BrightHR team. The employment law advice line is open 24/7, available to answer any of your questions.