New legislation is reshaping how businesses manage complex contracts, supply chains and workforce arrangements. We examine some of the key developments commercial organisations should be aware of.
Published: 11 November 2026
Authors: Michelle Craven-Faulkner
Commercial Payments Bill 2026
The Commercial Payments Bill currently making its way through parliament proposes significant reforms to tackle late payment practices said to disproportionately impact small businesses. Although further detail is still required, the reforms would make payment compliance a significant legal, operational and governance issue.
Subject to certain exemptions, a 60-day deadline to pay invoices will apply when large businesses enter into contracts to pay smaller businesses. This position will apply by default, and parties will not be able to vary this under contract. In the event that the purchaser is a public authority, payment terms will be capped at 30 days.
Late payments would attract mandatory statutory interest at 8% above the Bank of England base rate, and contractual attempts to exclude or restrict this entitlement would be ineffective. The bill would also introduce deadlines for raising invoice disputes and fixed-sum penalties where disputes are raised late or without sufficient information.
Large UK companies and LLPs would face enhanced reporting requirements and greater board-level accountability for payment performance. The Small Business Commissioner would receive stronger investigatory and enforcement powers, including the ability to impose financial penalties for persistent poor payment practices. Retention clauses in construction contracts would also be banned.
Businesses should prepare for these changes now by auditing existing payment terms to ensure compliance.
For more information, see our earlier articles: Commercial Payments Bill: Reforming UK late payment legislation; and Retention ban moves a step closer – but what will replace it?
Changes to the Modern Slavery Act 2015
The Immigration and Asylum Bill 2026 looks set to significantly overhaul the corporate modern slavery reporting regime that currently exists under the Modern Slavery Act 2015 (the Act).
Commercial organisations that fall within the scope of the Act are currently required to publish an annual slavery and human trafficking statement. The statement must either describe the steps that the organisation has taken to ensure that slavery and human trafficking are not taking place within its supply chains or business, or state that it has taken no such steps to verify if slavery and human trafficking are taking place within its business or supply chains.
The Immigration and Asylum Bill 2026 would bolster the existing “light touch” reporting obligations by mandating the inclusion of specific content within the statement. For example, organisations would need to publish details of policies relating to slavery and human trafficking and, where no such policies are in place, the reasons for this.
Businesses should review supply chain operations and existing practices to ensure they have the information required to prepare a compliant statement or explain why they have not been able to do so.
For more information, please see our earlier article: Modern slavery reporting: Are you ready for tougher rules?
Extended liability under the UK’s right to work regime
On 1 October 2026, the UK’s right to work regime significantly expanded in scope, resulting in some non-employment working arrangements being treated as employment arrangements for the purposes of right to work checks.
The changes to the Immigration, Asylum and Nationality Act 2006 have been brought in by the Border Security, Asylum and Immigration Act 2025 and will see many more organisations subject to the UK’s immigration compliance obligations.
For example, organisations that typically subcontract labour obligations in the context of their commercial arrangements may now be held liable if a worker within the contractual chain is found not to have the right to work in the UK.
For further information on the expanded scope, see a recently published article from our People and Reward team: New right to work rules widen business risk.
Strengthening contracts to comply with existing laws
Customers may also wish to strengthen contractual arrangements relating to existing statutory obligations. For example, the Employment Rights Act 2025 enhances certain duties on employers with respect to prevention of harassment.
Organisations may therefore wish to use contractual documentation to set appropriate standards or requirements for suppliers that support compliance with these duties.
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