The referendum in the UK has returned a result that confirms
that the majority of those who voted wish to leave the EU. What is
the impact of Brexit on employment rights, many of which, it is
said, depend on European law?
As the UK Government considers its next steps domestically and
internationally, the Withers employment team takes a first look at
how the decision to leave the EU might affect employment rights and
obligations in the UK. We have focused on the rights that employers
are likely to encounter during the course of employing people. We
have not looked at some specialist issues such as data protection
or the impact of Brexit on employers who operate in more than one
Our table shows that the picture is not entirely clear cut.
Over the forty plus years that the UK has been an EU member, UK and
EU laws have become entwined. Many of what began as purely domestic
rights, are now interpreted in line with EU law principles. So for
example, UK law made provision for what should go into a statement
of terms and conditions before the UK joined the EU. Since 1991, we
have had an EU Directive on employment contracts and our domestic
law is currently interpreted in line with that Directive.
In addition, some employment rights, such as the right to join a
trade union, are protected by the UK's status as a signatory to
the European Convention on Human Rights, rather than by its
membership of the EU. Adherence to the Convention does not stand or
fall with EU membership so Convention rights are unaffected by
In our view however prime candidates for reform would be
Transfer of Undertaking (Protection of Employment)
Regulations, also known as TUPE, dismissals, the ability to
harmonise terms and conditions after a transfer, introducing a cap
on discrimination awards and simplifying holiday pay rights.
The Government has a range of options open to it and it may be
many months before any real clarity emerges about how the
relationship between the EU and the UK will continue into the
future and how that will affect the legal framework. One potential
outcome is that the Government may introduce exemptions for small
businesses from certain employment measures. Here the Government
would have to give careful thought to possible unintended
consequences. If, say, employers of fewer than 20 employees were
exempt from certain employment law would this have the unintended
consequence of creating a disincentive for those employers to
Finally, there is a wide range of non-legislative and commercial
influences which have become embedded in the way in which
businesses deal with employment issues. The demands of investors,
supply chains, consumers and corporate social responsibility
initiatives may limit the scope and appetite for substantial
deregulation even if a future Government is now free to amend the
In SSE Generation Limited v Hochtief Solutions AG and another decided on 21st December 2016, the Court of Session in Scotland considered a contractor's potential design liability under the NEC Form of Contract.
Case law concerning the Agency Worker Regulations remains limited. We recently advised a recruitment business involved in a dispute with a "temp" and a hirer regarding who was liable for an alleged breach of AWR Regulation 5.
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