Brexit - democracy at work...
On 23 June 2016, Britain voted on whether to stay in the European Union (EU) or not – this was the second time the British electorate had been asked to vote on the issue of the UK’s membership – the first being in 1975.
Britain voted with its feet and on 24 June 2016, it was confirmed: Brexit was a reality – votes were in and we were going out (of the EU).
Nicola Sturgeon, Scotland’s First Minister, announced that a second referendum in Scotland was a distinct possibility, adding an additional layer to an already uncertain time – Britain would be the first country to leave the EU so the process of ‘Brexit’ is untested.
This all pushes UK businesses into a period of uncertainty – exactly what does ‘Brexit’ mean for employment, both in the UK and internationally? In the short term, there is unlikely to be significant change but as we start to untangle ourselves from political, legal and financial obligations over the next two years, this will start to change.
In the meantime, I have detailed below some of the key employment areas that may change as a result of Brexit over the coming months and years:
The Working Time Directive sets a 48 hour working week limit, although the Working Time Regulations (UK version) allows UK employees to opt out of this. Going forward, there is a possibility the 48 hour limit could be scrapped.
The EU Acquired Rights Directive led to the Transfer of Undertakings (Protection of Employment) Regulations (TUPE). The UK’s TUPE version is very much ‘gold plated’ and is, I believe, more onerous on UK businesses than the original EU directive intended. Given the UK has made this more demanding, there may not be any let up on the UK version of TUPE requirements.
Employing workers from the EU
If free movement is no longer allowed, it is likely that EU workers wishing to work in the UK will need work permits – which may mean more employers have to become sponsors through the immigration system. There has also been much talk about an Australian style points system where visas are points-tested based on personal attributes and ability to contribute to society. It is also unclear how EU citizens already working in the UK would be affected, although there is no indication of a short term impact. Watch this space…
Uncapped discrimination compensation
Uncapped discrimination compensation was a result of a European Court of Justice (ECJ) decision in 1993 so although it is highly unlikely that the discrimination legislation will be relaxed it is possible that a cap on discrimination compensation could be reintroduced. The same could be applied to other ECJ decisions impacting on the UK.
The equal pay rights for agency workers after 12 weeks on the same contract were introduced via EU regulations and could be repealed following Brexit.
Family friendly legislation
Some family friendly legislation, most notably linked to maternity and accrual of holidays, could be reversed by an independent UK.
Of course, some UK employment law does not stem from the EU – unfair dismissal and minimum wage legislation - so Brexit should have no impact on these. Though in the event of Scotland at some point (and possibly even Northern Ireland) gaining independence from the rest of the UK, and being a full or associate member of the EU, is likely to cloud things further. Either way, it’s going to be a complicated time for employers.
We will of course keep you updated on any changes as a result of Brexit over the next few months, but if you have any queries in the meantime, please contact us on +44 (0) 333 210 1995 to discuss supporting you and your business through this time of uncertainty.
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