In this article, Kathy Daniels, BSc, FCIPD, SFHEA, Employment Law Author and Lecturer, looks at Brexit, and what the future might hold.
On 23 June 2016, the UK voted to leave the EU. In this article, we will examine the process that has to take place for the UK to actually leave the EU, the impact on employment law and issues that you should be thinking about now.
To leave the EU, the UK has got to formally trigger Article 50 of the Treaty on European Union. This means that the UK has to tell the European Council of its intention to leave the EU, and then enter into negotiations about the future relationship between the EU and the UK. The EU Treaties that apply to all Member States will cease to apply to the UK two years after the notification has been given, or when the negotiations have been completed — whichever occurs first. This period can be extended if the UK and the European Council unanimously agree to an extension.
The UK decides when that two-year period starts, by deciding when to give notice. Despite various rumours in the media, there is no current certainty about when the notice will be given. Some have suggested that it will be given at the start of 2017, because the EU budget year is the calendar year and hence leaving at the end of a calendar year would seem to be less complicated. Others have suggested that politicians will try to avoid an exit coinciding with a general election (the next is due in 2020). However, this is a decision for the politicians to make.
The effect of Brexit
The reality is that no-one knows what the actual impact of Brexit will be. An issue that has caused a lot of comment is the freedom of movement of EU nationals. It is likely that there will be some requirement to allow some level of movement, but the negotiations will determine exactly what this is. At present, it is not possible to say what the future status of current EU employees will be, and neither is it possible to be certain about the future of current UK employees living and working in the EU.
It is also important to note that leaving the EU does not result in any specific consequences for employment law. Law that has been introduced due to EU Directives has been introduced into UK law. For it to be removed would require the UK Government to repeal the legislation.
For example, we have the Working Time Regulations 1998 due to the EU Working Time Directive. Leaving the EU would not mean that the Working Time Regulations 1998 would cease to exist, because they are part of UK law. However, depending on the relationship with the EU that the UK negotiates, the UK would have more freedom to make changes to working time legislation than it currently has — if it had the appetite to do so.
Various opinions have been expressed about what employment law the UK might want to repeal. It has been suggested that a cap could be put on compensation for discrimination claims, that the 30/45-day consultation for collective redundancies could be reduced and that the Agency Worker Regulations 2010 could be altered. However, this is all speculation. What is certain is that nothing will be changed until the UK has left the EU — which is likely to be at least two years away — and then it will depend on what the Government of the time prioritises as areas to address.
Things to think about now
Although there is considerable uncertainty about what the future holds, there are definitely a number of things that you should be thinking about now.
For now, and until there is any agreement to the contrary, EU nationals have freedom of movement within the UK. Hence, refusing employment to an EU national, or selecting an EU national for redundancy, because of their nationality would be unlawful and could lead to a successful race discrimination claim.
Ensure that your line managers do not take nationality into consideration when making any decisions involving the employment of EU nationals.
Within days of the outcome of the referendum being announced, there were reports of EU nationals being treated in unacceptable ways. There were reports of physical attacks, nasty social media posts, graffiti and a variety of other behaviour that would amount to harassment as defined in the Equality Act 2010.
Ensure that none of this behaviour is happening within your organisation or between your employees. You have responsibility for all that happens in the course of employment, and you have a duty of care to all your employees to protect them from harassment or bullying.
There are a number of sectors within the UK which rely heavily on labour from other EU countries. If this is true of your company, start to think about what you would do if you were not able to draw from this pool of labour in the future.
Do you need to start thinking about alternative sources of labour? Do you need to be investing in the training and development of existing employees? Do you need to be liaising with local schools and colleges to develop appropriate training courses or qualifications? Although it is possible that the current sources of labour will remain open to you, it is possible they will not — so you do need to be planning ahead.
It might also be useful to carry out an audit of your current employees. Ensure that you are clear where you might have skill gaps if EU nationals are not able to continue working freely in the UK.
Many EU nationals working in the UK, and UK nationals working elsewhere in the EU, are understandably worried about the future. Keep an open dialogue with such employees but do not be tempted to make promises that you cannot be certain of keeping.
Remember that a verbal promise can be contractually binding, in exactly the same way as a written promise. So, do not be tempted to reassure employees with promises that you cannot be certain that you can deliver.
We will keep you advised as the impact of Brexit unfolds over coming months.
Last reviewed 2 September 2016