As the odds of a no-deal Brexit continue to shorten, the CIPD considers the implications for employers if the UK leaves the EU on 31 October 2019 without a deal
Immigration policy and considerations
Currently, EU nationals enjoy free movement and have the right to live and work in the UK, and reciprocally, UK nationals in other EU countries. Under the terms of the Withdrawal Agreement between the UK and the EU, this position would have continued until December 2020. However, as the UK Parliament has rejected the negotiated deal, free movement may come to an end sooner than anticipated.
The EU Settlement Scheme continues to operate and will enable EU citizens already living in the UK to apply for settlement indefinitely. But how long they have to apply and what the situation will be for new arrivals after 31 October 2019 will depend on what is agreed in Parliament in the coming weeks. In the event of a no-deal Brexit – the application deadline for the scheme is 31 October.
When free movement does end, the government proposes to install a skills-based immigration policy that promises employers they would continue to ‘have access to the skills that add most value to the UK economy’. Although a route for low-skilled migrant workers has not been specifically provided, a transitional measure for temporary workers to stay for a limited time has been included. The CIPD will be consulting members on whether this 12-month visa should be extended and share the feedback collected with the government.
How Brexit and these policy proposals will evolve remain to be seen and the CIPD will continue to keep members informed on the developments. Employers meanwhile, should take the opportunity to consider their employees and how they may be affected by the potential changes in circumstance.
Our updates and guidance below provides practical help for employers to understand and manage these and other considerations such as:
- What does Brexit mean for employees who are EU nationals?
- How can they be given useful and reassuring information on an inherently personal and uncertain topic?
- What needs to happen so that they and their families can continue to live in the UK?
- What about employing EU nationals in the future?
Gerwyn Davies takes the latest Labour Market Outlook data which shows that the number of applications for jobs is falling and looks at what could be to blame
This report explores the challenges employers are facing in filling vacancies, the role EU nationals are playing in the workforce, and makes policy recommendations that work across all sectors
Introduces the current points-based system for economic migration focusing on the Tier 2 route for non-EU migrants
Learn about recruiting overseas workers, the categories of non-UK nationals able to enter and work in the UK, and the legal framework involved
EU withdrawal process and effect on employment law
The negotiated terms for withdrawal agreed between Theresa May and the EU has been soundly rejected by Parliament. New Prime Minister, Boris Johnson, must now agree new terms and pass these through Parliament, or the UK will leave the EU without a deal. In the event of a no-deal, the UK will leave without transitional arrangements in place and its future relationship with the EU left undefined.
Leaving the jurisdiction of the Court of Justice of the European Union may take place at a later date, depending on the terms of the final departure (the UK will still be bound by decisions from the European Court of Human Rights which is not an EU institution). When it does happen, it will likely lead to case law changes as employment cases go through the appeal process. Holiday pay and accruing holiday on long-term sick leave are prime examples of where change could arise, but this will be incremental and Parliament could introduce legislation to deal with the current issues before this happens.
The withdrawal will not, of itself, repeal UK employment laws or immigration rules wholesale. Parliament will need to repeal the European Communities Act 1972, but many of the UK’s employment laws from Europe or stemming from European Directives have been introduced through other UK legislation. Each individual law would need to be amended or repealed one by one. Views differ as to which, if any, employment legislation will be dismantled following the UK’s departure from the EU.
However, several areas of law in the HR sphere will undoubtedly be reconsidered once the UK’s withdrawal occurs, not least employers’ consultation obligations when restructuring and planning redundancies. A number of other laws are also likely to come under the spotlight.
This report, produced in partnership with law firm Lewis Silkin, examines employer views and experiences of implementing UK and EU employment law
Many UK anti-discrimination provisions predate EU obligations – sex, race, disability and protection beyond employment into goods and services, all existed before the UK became an EU Member State. A more likely change could be to place limits or caps on discrimination compensation awards.
Holidays and working time
Holiday entitlement flowing from the EU Working Time Directive is another area likely to be debated. The 48-hour working week and the rules on opting out may well be top of the list for repeal, but will the UK really reduce paid holiday? Will holiday pay calculations change (for example, by excluding overtime and commission in future)? Even if the law changes, this will not override employees’ existing contractual rights.
Atypical workers' rights
EU-driven protection for agency, part-time, fixed-term and posted workers has been introduced in the UK. Those businesses using or supplying contingency workers may gain more freedom following the UK's withdrawal from the EU.
Transfer of undertakings (TUPE)
The UK’s TUPE provisions derive from the EU Acquired Rights Directive and we are likely to see changes in the rules restricting the harmonisation of terms and conditions after a TUPE transfer. On the other hand, the UK itself extended TUPE rights to ‘service provision changes’ through domestic law, not because it was obliged to do so by the EU.
The EU General Data Protection Regulations have direct effect on member states and will require changes to the UK’s data protection law and practices. Timing is a major issue as they have to be implemented by May 2018. Unless and until exit occurs, the UK remains a member of the EU and will be required to comply, even if the UK expects to repeal these laws subsequently. Regardless of this, how many businesses will face difficulties in their cross-border trading if they opt out of these provisions even if UK law allows this?
Information on determining a person’s employment status
Guidance on the employment legislation governing holiday entitlement and holiday pay
Guidance on the law protecting employees when a business changes owner
Information to help employers comply with the Data Protection Act