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24th June 2016

It’s been in the headlines for months but, now that Britain has voted to leave the EU, what does it actually mean for businesses? Many current workplace regulations originated in the EU and employers and employees alike have voiced concerns over what position they could now be in.

One thing is clear – everyone will be affected by the change. We also know that there will be no immediate break from the EU. The transition will require enormous negotiation and potentially several years to implement. While it’s impossible to predict exactly what impact the vote to leave is going to have on UK business, it’s likely that the UK will now go down one of two very distinct paths:

  • Repeal unfavourable laws immediately and keep the remainder
  • Keep the current EU laws and regulations in place, and gradually repeal or restructure those which are less favourable over time

It is unlikely that the UK would simply repeal all EU related employment law as this would create a state of chaos for employers, who would be unsure what laws do and don’t apply.

A consultant with ELAS, specialising in employment law took a look at all the issues and suggests that the second path seems most probable.

One of the areas of concern for employers and employees alike is that of EU workers. Many businesses currently employ citizens from across the EU and could be questioning their future eligibility to work – or continue working – here in the UK. In the short term at least, the chance of EU workers being affected by the vote is slim. Potential future EU migrants are the ones who could be affected by the changes. If the UK chooses to stay in the European Economic Area (EEA), it is likely that EU nationals would retain their right to work in the UK; however the UK government would have the freedom to implement whatever it chooses, and could require EU citizens who wish to work in the UK to have a work permit or visa in the same way as non-EU citizens do currently.

It is important that businesses stay up to speed with any changes to legislation, particularly those which originated from EU regulations, in order to stay compliant with any changes.  While we can safely assume that the government will not introduce any radical changes to current employment law, it’s undeniable that the UK employment landscape will alter. Both the government and UK businesses will want to avoid the legal and commercial chaos that could come from repealing current laws.

According to our consultant, the areas which are unlikely to change include:

National Minimum Wage – This is very much a British idea and regulations are not required by European law. Furthermore, the UK National Minimum Wage is significantly higher than that in similar European systems and the UK Government recently introduced the National Living Wage.

Transfer of Undertakings (TUPE) – The UK has gone further than the EU in terms of TUPE and when it applies so there are unlikely to be any changes.

Unfair dismissal and tribunals – Legislation relating to unfair dismissals and tribunals will almost certainly remain the same. Much of it did not originate from the EU, for example the fees system which was introduced to stop spurious claims.

Discrimination – While many of the UK laws regarding discrimination derive from the EU, it’s unlikely that there would be any major overhaul. Many UK discrimination laws have their origins pre-EU. The government could also face serious backlash and uproar, and there would be wider social implications if these laws were to be repealed. When it comes to issues such as the gender pay gap it’s impossible to know how they will be shaped, however they will probably remain unchanged for the foreseeable future.

Data Protection Act – This is a bit of an unknown area as it came about from an EU law. It’s difficult to predict exactly how it will be affected however, echoing the approach to discrimination laws, it’s unlikely that the Data Protection Act would be repealed as it would cause public outrage.

However Mr Garcia says that once Britain leaves the EU, we can expect to see changes in the following areas:

Working Time RegulationsThe Working Time Regulations (1998) has long been a point of contention with politicians campaigning for the UK to opt out. They influence weekly working hours, rest periods, paid annual leave and extra protection for night workers and, while it’s difficult to say how each of these points will be affected, it’s more than likely that they will be restructured beyond current recognition but it is unlikely that they will be completely repealed.

Agency Worker’s Rights (AWR) – This is expected to be high on the list of legislation to be amended or fully repealed. AWR was introduced to comply with the EU’s agency workers directive and is almost universally unpopular. It has been heavily criticised and is expected to be completely repealed.

Right to Work – Leaving the EU calls into question the position of UK nationals living and working in Europe as well as EU citizens working in the UK (as discussed above). The EU will be able to decide the terms on which it will allow British nationals to work in the EU but it’s likely that the UK would negotiate separate trade agreements allowing both UK and EU nationals to work flexibly.

ELAS’s legal experts can help businesses understand the implications of any legal changes stemming from the UK’s vote to leave the EU. Call 0161 785 2000 to speak to one of our experts today and find out how to keep your business one step ahead of any changes.


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