Introduction: A bold new push to tackle illegal employment
Chancellor Rachel Reeves is preparing to roll out a targeted crackdown on illegal working in some of Britain’s most visible service sectors. In next week’s Budget, Reeves is expected to announce a dedicated team of investigators with a £1 million budget designed to clamp down on unscrupulous businesses employing workers illegally. The measure signals a broader government effort to level the playing field for compliant firms and protect workers who are exploited in low-wage sectors.
The sectors under scrutiny
The focus areas include car washes, nail bars, and takeaways—businesses that have routinely faced allegations of under-the-table payments, minimal tax contributions, and unsafe working conditions. By concentrating enforcement resources in these high-visibility environments, the government hopes both to deter illicit practices and to send a clear message to operators who seek to cut costs by bypassing basic employment standards.
Car washes
Car washes have long been cited in government reports as hotspots for illegal working, with some sites relying on workers who are not properly registered or paid under-the-table wages. The proposed investigators will coordinate with HM Revenue & Customs and the Home Office to verify workers’ rights, ensure proper payroll records, and check compliance with national minimum wage rules. The goal is not only to identify illegal arrangements but to create a deterrent effect across the sector.
Nail bars
Nail bars have also been a focal point for enforcement because of the delicate balance between customer service quality, health and safety, and fair labor practices. Reeves’s plan emphasizes robust spot checks, transparent wage declarations, and adherence to licensing requirements. By bringing scrutiny to these venues, the government aims to protect skilled workers and reduce the risk of exploitation in the beauty industry.
Takeaways
Takeaway outlets, often operating with tight margins, can be vulnerable to payroll misclassification and underpayment. The new initiative would bolster inspections at multiple points in the supply chain, including supplier relationships and recruitment processes. Investigators will assess whether workers have proper documentation, whether payrolls are legitimate, and whether employers are complying with health and safety standards and tax obligations.
How the plan fits into Reeves’s broader agenda
The crackdown aligns with a wider reform strategy aimed at boosting worker protections, improving tax compliance, and encouraging fair competition. Reeves has repeatedly argued that illegal working distorts the market, undermines legitimate businesses, and deprives workers of benefits and protections. The Budget measure is designed to be practical and enforceable, rather than purely punitive, by providing clear guidelines for employers and a framework for timely enforcement actions.
What the enforcement package could look like
Key components of the package may include random and targeted inspections, improved data sharing between enforcement bodies, and more streamlined penalties for non-compliance. A £1 million fund is expected to finance a small, highly skilled team—complemented by digital tools to track visas, work permits, and payroll records. Critics may push for ensuring that enforcement is proportionate, with due process for business owners who are genuinely transitioning to compliant practices.
Economic and social implications
Proponents argue that cracking down on illegal working helps protect workers from exploitation, reduces unfair competition for compliant businesses, and increases government revenue through proper taxation. Opponents might worry about the risk of overreach or the potential impact on legitimate small enterprises. Reeves’s plan appears to emphasize targeted enforcement with a focus on high-risk environments, aiming to minimize disruption for legitimate operators while delivering measurable improvements in compliance.
What this means for workers and consumers
For workers, the initiative promises stronger protections, clearer pay and working conditions, and access to formal channels for redress. Consumers could benefit from higher standards across popular service sectors, potentially improving service quality and safety. If successful, the crackdown could serve as a model for similar enforcement programs in other industries facing wage and visa abuse challenges.
Conclusion: A pragmatic step toward fairer work practices
As the Budget weekend approaches, all eyes will be on how the new investigators will be deployed and what measurable outcomes the government expects. Reeves’s plan to tackle illegal working in car washes, nail bars, and takeaways represents a pragmatic effort to safeguard workers, protect legitimate businesses, and reinforce the integrity of the UK’s labor market.
