How will UK Employment Law be affected by Brexit?

It is fair to say that, despite recent headlines to the contrary, in reality there will be no immediate changes to UK employment law as, until a formal Brexit actually takes place, the UK will still remain subject to EU law and EU decisions.

According to the terms of exit from the EU, the UK will have a period of up to two years within which to negotiate the terms of its withdrawal and it is not yet known when that period of two years will even begin.

Moreover, although much UK employment law is derived from EU law, EU legislation generally only serves as a foundation and the UK usually augments any regulations to go beyond what is required, e.g. in maternity leave and paid holiday provisions.

 

In fact, a great deal of UK employment law has no basis in EU Law, e.g. the National Living Wage and Minimum Wage are the result of laws made in the UK in isolation.  Also, the recent changes giving the right to share parental leave was the result of UK government legislation supported by both the coalition and opposition.

It will be for Parliament to decide whether to retain, amend or repeal current domestic legislation post Brexit.

Of course, many employment rights derived from EU law have already been written into the contracts of UK employees. Employers will therefore face difficulties in making changes to existing contracts, even if EU regulations are no longer applicable. In addition, any European Court of Justice decisions will continue to apply in the UK until the Government or the UK courts determine otherwise.

If a future Government were to consider any changes to employment regulation, areas currently governed by EU law such as harmonisation of contracts after a transfer of undertakings (governed by the TUPE regulations), the calculation of holiday pay, agency workers’ rights and the introduction of a cap on compensation in discrimination claims could be open to alteration. These areas have caused major headaches for UK employers and are unlikely to be mourned.

However, it is feasible that the UK would still be required to apply future EU legislation to domestic laws as a condition of a new trade deal between the UK and EU.

In addition, the UK may still have to accept free movement of labour to some extent, similar to the position in Norway and Switzerland.

Employers who have EU national workers can give some reassurance that there will be no immediate change in their right to live and work in the UK. Workers from other EU countries continue to enjoy the same rights as they had before the referendum.

Importantly, it remains unlawful to discriminate against workers from other EU member states (or discriminate in favour of them). All workers must still provide identity checks and employers will face civil and criminal penalties if they employ workers who do not have the right to work in the UK.

Following the referendum result, there has been an increase in race related crimes and workplaces can be vulnerable to this type of behaviour.

Bullying and harassment because of nationality or national origin are unlawful discrimination and employers should ensure all their workers are aware that such behaviour will not be tolerated.

There is a great deal of uncertainty both about the immediate economic consequences of the vote to leave the EU and about how the UK’s future relationship with Europe will work but Brexit does, however, open up the possibility of some simplification of the more complex regulations which have the biggest impact on business.

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