The impact of Brexit on Employment

There are a number of different ways in which Brexit may impact workplaces and workforces, from the framework of employment law to the implications of employing EU residents and practicalities on conducting business in Europe.

A substantial amount of employment legislation in the UK is founded upon EU Directives, including family leave, discrimination rights under the Equality Act and the Working Time Regulations.  During the Transition Period, that applies from 1 February 2020 until 31 December 2020, employment and immigration requirements will remain mostly unchanged, with free movement of people effectively still applying.  The changes that will be experienced post Brexit will vary depending on the terms agreed for the future trade deal to apply at the end of the Transition Period, and the relationship that is forged in the process.

The issue of whether any post Transition trade deal will either maintain EU-derived employment rights into the future (so-called “regulatory alignment”) or enable their diminution is clearly a matter of current political debate and controversy.

The European Union (Withdrawal Agreement) Act 2020 (“the Act”) departed from the previous draft version of the legislation which included some provisions ring-fencing existing EU-derived employment rights and relevant judgments of the European Court of Justice (ECJ). These provisions were taken out of the draft legislation as introduced after the recent election.  Instead the Act gives the Government power to issue regulations setting out the circumstances in which UK courts and tribunals will be free to depart from established law based on ECJ case-law. It is widely predicted that this latitude could in the long term result in substantial and long-lasting uncertainty for employers and employees alike, for example in the areas of holiday pay, redundancy consultation and TUPE transfers.

There are a number of areas that Brexit is likely to affect workers beyond legislation being changed. These include:

  • EU citizens working in the UK: employers should ensure that all eligible individuals apply for settled status under the EU Settlement Scheme, as discussed in our blog; and
  • British citizens working in the EU: during the transition period, British citizens are able to continue working and living in the EU. Under the Withdrawal Agreement, British citizens who are lawfully resident in EU member states before 1 January 2021 will be able to continue to live, work and travel in the EU (although these rights would cease after a leave of absence of more than five years). British citizens will have until 30 June 2021 to apply for residence status.

The longer term implications will depend on how each individual country puts arrangements in place, with many countries having not decided this yet. If you or anyone you employ works in the EU, ensure that you are aware of the provisions in place for that country post Brexit https://www.gov.uk/guidance/living-in-the-eu-prepare-for-brexit

Business travel to the EU: British citizens will be exempt from visa requirements for up to 90 days in a 180 day period. Business travel includes activities such as travelling for meetings and conferences, providing services (even with a charity), and touring art or music. However, if British citizens wish to undertake paid work there will be different regulations to comply with such as telling HMRC that you will be working in the EU and paying social security contributions. You should also be aware of the restrictions and procedural requirements if moving goods into the EU, e.g. taking products to an international trade fair. For more information visit https://www.gov.uk/visit-europe-brexit/business-travel

Recognition of professional qualifications: employers should keep abreast of any changes to the arrangements for mutual recognition of professional qualifications between the UK and the EU, and in particular any need for new recruits to apply for formal recognition of their European qualifications.

The key step that should be taken is for businesses to talk with their employees so they can understand potential issues and concerns that may be faced following Brexit.

If you wish to understand more about the potential implications of Brexit on your workplace, or on employment law more generally please get in touch with Melanie Stancliffe or Patrick Glencross .