How a Brexit Could Affect Employers
With the referendum fast approaching, everyone has an opinion on whether Britain should leave or remain – with so much information being put to the public, it is no surprise that many are undecided on how to vote.
When it comes to HR and employment law, many things spring to mind not least because EU law is the source of many of the UK’s employment rights – will your employees working hours and pay be affected? What happens if you need to make redundancies? You might even be worried about how claims for dismissal or discrimination will be handled – whatever your concern, it's worth informing yourself of the possible consequences of a Brexit.
Partner and Head of Corporate Services Zee Hussain explains what a Brexit could mean for UK employers.
Employment Law Could Be Affected
Many of the UK's employment laws have foundations in EU Law – with most, if not all, being beneficial to your workforce. But what are the 4 things that are most likely to impact your business in the event of a Brexit?
- 1. Freedom of Movement
At present, we have around 2 million people working in the UK who are EU citizens, as well as a huge number of ex pats living on the continent – both working and retiring to sunnier climates. A Brexit may mean that this automatic freedom to live anywhere in the EU is no longer a legal right, potentially reducing your available pool of future employees.
- 2. Working Hours and Pay
UK workers are restricted to working a maximum of 48-hours a week under EU law. Equal pay for work of equal value has also been enforced by the European Commission. The Government may remove these restrictions on working hours and pay – meaning your workforce could potentially work unlimited hours every week. This could leave them open to exhaustion, mistakes, poor mental and physical health; any number of issues and pressures that could arise from a less regulated approach.
- 3. Non-Standard WorkThe Part Time, Fixed Term, and Agency Workers Directives have been incorporated to give many of the same protections that full-time, permanent workers are afforded to people who don't work 'standard' jobs. These rights may be removed in the event of a Brexit, meaning that your staff will not be protected by the law.
- 4. TUPE
TUPE regulations protect the rights of employees if a business transfers or outsources its services. A Brexit may see the government reduce its involvement and regulatory influence allowing employers to simplify the process. Whilst this would allow you to impose swifter and less regulated changes to your staff's terms and conditions, it would also open your business up to a minefield of acrimonious departures, resulting in a vacuum of talent.
Changes to Employment Law
Zee explains:"The likelihood of significant change to UK employment law in the event of a majority vote to leave the European Union is small, at least in the short-term. We will have to watch this space, as any change is likely to be driven by the terms of the UK's relationship with the EU upon leaving. The current laws would not simply cease to exist; in fact many would continue to be enforced. EU created measures are important to UK law for many reasons, so much so - they are established as the status quo and are not unusual or undesired."
"Whilst speculation is rife, forecasting with any certainty on the outcome of a Brexit is no easy task. However, the fact of the matter is any form of exit from the EU would take two years, at the very least, with further time spent negotiating terms."
"Without knowing the exact nature of the relationship it is a fair assumption that much may remain the same for UK employers on the basis that the UK would still want to trade in the EU market and this would require the UK to abide by EU laws."