Fair Work Action Plan: impact report 2026

3) Key achievements

Many of the actions in the Fair Work Action Plan seek to influence long-term labour market outcomes. However, evidence indicates positive steps in strengthening Fair Work through public investment; improving pay and security for workers; building capacity among employers; and supporting increased labour market participation.

Strengthening Fair Work through public investment

• Fair Work First requirements were applied to nearly £4 billion worth of public sector grants between April 2025 and March 2026.
• The independent evaluation of Fair Work First found that the Fair Work First policy is ensuring public funding reaches employers committed to fair work practices, despite challenging economic conditions.

Improving pay and security

• Scotland continues to lead the UK on payment of the real Living Wage (rLW), with 88.6% of workers over 18 paid the rLW.
• In 2025, the proportion of women employees aged over 18 earning the rLW or more in Scotland (88%) was higher than the proportion of women earning the rLW or more in the UK as a whole (83.2%).
• The number of Living Hours accredited employers in Scotland has reached over 130 in 2026, helping more workers access secure and predictable working hours. Scotland holds 45% of the Living Hours network in the UK.
• In Early Learning and Childcare (ELC), 96% of funded ELC providers in the private and third sector are now paying the rLW to either all staff or staff delivering funded ELC. This represents a substantial increase since the 81% reported in 2023, extending fair pay across the funded childcare workforce.^[1]
• In Adult Social Care, productive discussions are in the final stages with partners to introduce sectoral bargaining arrangements. A voluntary body could begin negotiating in 2026, with deals implemented from 2027-28.
• Until then the Scottish Government will continue to invest in this workforce, by providing more than £1.1 billion in social care pay annually. This includes an additional £175 million this financial year to enable adult social care workers delivering direct care in commissioned services to be paid the rLW.
• Latest figures show that in April 2025, the gender pay gap for full-time employees in Scotland widened from 2.0% in 2024 to 3.5% in 2025. This was due to men’s hourly earnings (excluding overtime) increasing at a faster rate than women’s.
• The gender pay gap for full-time employees in Scotland continues to be narrower than the UK gap (3.5% v 6.9%) and has been since 2003.
• The estimated disability employment rate gap has decreased from 37.4 percentage points (pp) in 2016 to 32.5 pp in 2025.

Supporting businesses and building employer capacity

• The Fair Work Festival 2026 brought together more than 300 participants across 14 sessions celebrating good practice, providing guidance to employers and raising awareness of Fair Work. High attendance and positive feedback demonstrate continued demand for practical Fair Work support and peer learning.
• In March 2026 the Scottish Government funded Scotland’s first Flexible Working Summit to showcase employers who had successfully adopted flexible working in sectors where flexibility is harder to embed.
• In March 2026, the Scottish Government published an ‘In-work and child poverty: shared statement’ with Business in the Community following a roundtable discussion with employers. This reinforced a growing recognition of the role employers can play in tackling in-work poverty and improving workplace cultures that can help people from all backgrounds remain and progress in work.

Supporting labour market participation

• There was continued improvement to devolved employability services delivered through No One Left Behind, including the introduction of Specialist Employability Support (SES) from July 2025. This ensures every Local Authority area has a ‘place and train’ offer of support for disabled people and people with a long-term health condition. Data on SES is published as part of the quarterly No One Left Behind statistical summary.
• In March 2026, Public Health Scotland hosted an Employer Summit with support from the Scottish Government and the UK Government. The event formally launched the Keep Britain Working Vanguard phase in Scotland, engaging with employers about improving health in the workplace and supporting a more coordinated approach to helping people remain in, return to and thrive in work.