UK: Is Employment Law In The UK About To Change In Light Of BREXIT?

Last Updated: 2 December 2016
Article by Jonathan Lilley

Until the shape of the UK's exit from the EU has been determined, the direct legal implications for UK businesses is unclear. Employment law, which is always a topic guaranteed to produce high levels of interest among Blaser Mills' clients, is no exception.

If there are to be changes, they will emerge slowly, certainly not overnight and in any event may not be all that significant.

If you are an employer who voted to leave the EU, motivated by the thought that your business would quickly find itself free from everything you thought you hated about being an employer (for which you have been blaming EU law) you are likely to be waiting a very long time and/or be disappointed at the end of a long wait! You may also have had a somewhat skewed picture as to the impact of the EU upon UK employment law in the first place.

Similarly, if you are an employee and feeling anxious as to how differently, if at all, your employer may treat you going forward, I would say there is no need for such anxiety and you should be reassured.

It is worth bearing in mind that one of the central themes emerging over the last few days, is the need for those negotiating new relationships with our EU neighbours to be presenting the UK as an attractive future trading partner outside of the EU. What that means is our approach to all sorts of different things that could theoretically be changed or undone as a result of exiting Europe, probably shouldn't or won't change all that much. I would suggest that employment law is a key part of this.

All of the following is pure speculation and in summary:

  • Discrimination- It is very difficult to see The Equality Act 2010 disappearing in a post-EU age. Any move to repeal this would be hugely controversial on so many levels. Popular speculation includes a cap on discrimination-based compensation award, and the introduction of some positive discrimination laws for certain minority groups- something currently not possible under EU law.
  • Working time regulations and holidays- Given that the 48 hour cap on working hours has an 'opt-out' already, and appears to be largely ignored by many businesses and workers alike, there is a strongly held view that this could be scrapped or perhaps the opt-out being turned into an opt-in. Holiday pay is so well-established, it is difficult to see this right being repealed. However, there are some very unpopular European Court of Justice decisions on the accrual of holiday pay such as during sick leave. These matters could possibly be dealt with by a UK government once free from EU constraints.
  • Maternity rights, parental leave and flexible working- Most of the law surrounding these areas (while perceived by some to be unwelcome burdens on businesses) were conceived in the UK in the first place. Maternity rights, including pay, were around before the EU and are more generous today than the equivalent 'bare minimum' EU rights.
  • Collective redundancy consultation- These have already been reduced by the last government. Some say that these rights could be scrapped altogether, but the perception as to their onerous nature is perhaps stronger than the reality. All rather unclear.
  • Agency workers- The Agency Workers Regulations 2010 are viewed as complicated and not at all popular with businesses to say the least. Thought to be a good example of a set of regulations that could well be scrapped in an EU-free legislative environment, they are not yet rooted into the UK legal framework in a way that would make them all that politically tricky to remove. A sitting duck for a BREXIT employment law sniper!
  • Transfer of Undertakings or 'TUPE' as we call it- Although there is some negativity around TUPE, it is generally thought to be useful in principle, and much of the negativity is around some of its more technical 'business-unfriendly' and at times unwieldy procedures. It is thought that there may be some useful tinkering with TUPE in a post-EU era to make things a little more business-friendly (such as an easier route to harmonising contracts of employment) but wholesale repeal is unlikely.
  • Data Protection- If UK businesses want to operate in the EU (or vice versa) they will have to transfer personal data between the UK and EU member states. Clearly adequate protections equivalent to the current ones will be essential. It's very hard to see any of the current Data Protection laws being scrapped or substantially diluted.
  • Freedom of movement & immigration – It won't have escaped anyone's attention in the BREXIT post-mortem, that much is already being said along the lines of if the UK is to negotiate new trade agreements with the EU, then there will have to be some sort of deal on the free movement of people, since this is regarded as fundamental by EU states and particularly those with the most clout- France and Germany.

The UK will need to continue to trade with one of its largest export markets- the EU. The price of a decent trade agreement with the EU is most likely going to be (among others) a continuing commitment to, and acceptance of, EU employment law. This is already the case for the non-EU members of the European Economic Area (EEA). It is difficult to see how the UK would be in any different position. In short- it seems highly unlikely that UK employment law is about to undergo any (let alone any significant) transformation in light of the BREXIT vote and certainly not in the short term.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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