Brexit and HR | Brexit and UK Employment Law

Brexit and UK Employment Law: What will Brexit mean for UK Employment Law?

 

What is the likely link between Brexit and UK Employment Law reform following the EU Referendum?   Six weeks on from the EU Referendum and the decision to leave, has, in the short term, created political and economic turmoil.  There has been seismic shifts in the political agenda.  The financial markets are in chaos.  Sterling is at a 30-year low against the dollar, and today interest rates have been cut for the first time in 7 years from 0.5 per cent to 0.25 per cent – a record low.  This begs the question, given the current state of things, and the political rhetoric, will the reform of employment law, and further deregulation of the UK labour market be high on the Government’s agenda?  What, if anything, is the link between Brexit and UK Employment Law?

The disruption caused by the Brexit vote is likely to restrain any zeal for employment law reforms. This is unlikely to change for the next couple of years at least. It is assumed that employers would like to see a reduction in employment regulation in the future. However,in the most recent Department for Business, innovation and Skills (BIS) “Small Business Survey 2015: businesses with employees”, just 13% of SMEs identified employment regulation as an obstacle to success.

Once Article 50 is triggered, there will be a two-year negotiation process that will tie up the majority of Westminster’s resources. As a result, nothing much is likely to happen to UK employment law in the near future.

If the UK ends up with a deal similar to Norway’s where it is offering access to the single market. The UK will continue to be bound by European employment law. UK businesses will not be allowed to undercut EU businesses by employing workers on commercially advantageous terms to their EU competitors.

Brexit and UK Employment Law

The current UK government would aspire to remove some elements of EU led employment law.  However, even if they could, I believe the impact in the medium to long term would not be particularly significant.

  • The Working Time Regulations (WTR) will be left alone.
  • The Agency Worker Regulations is generally unpopular with business and the current Government would be of a mind to repeal it. However, it is likely to be lost in the myriad of legislation that will need to be repealed to effect Brexit.
  • It is likely that Equality Legislation will be left alone. But I can envisage compensation payments being capped.
  • TUPE will be left alone. Although there will be a desire to allow “harmonising” of terms and conditions of employment post transfer- this is currently unlawful under EU law. Although I think it will be some time before this happens.
  • Changes to collective redundancy consultations won’t be on the Government’s Agenda for some time.
  • Further deregulation of the labour market will have a low priority. The UK already has more flexibility over employment law, than most of the EU. Also amongst OECD countries, only the USA and Canada are less regulated in terms of employment protection legislation.

‘Brexit and UK Employment Law | Brexit: What will it mean to UK employers?’  has been posted by Sean McCann, the Managing Director of People Based Solutions an HR consultancy specialising in delivering outsourced HR solutions to small and medium sized businesses.   If you would like to know more about how we can help you cost-effectively manage your business’ policies, procedures, and its employer’s obligations, contact us at: enquiries@peoplebasedsolutions.co.uk

 

Brexit and HR
Brexit Human Resources Management
Brexit Employment Law
Brexit and The Working Time Regulations
Brexit and The Agency Worker Regulations
Brexit Transfer of Undertakings (Protection of Employment) Regulations
Brexit and TUPE
Brexit and The Equality Act
Brexit and Redundancy
Brexit SME’s