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13/06/2016

Brexit for Employers

We’re only days away from the referendum now, and as we get closer I have had a number of interesting conversations with clients on both sides of the campaign. But, what would a leave vote mean for UK employment law? In theory, the UK government could repeal any employment law introduced as a result of the EU’s influence. But what is the reality?

Discrimination: the UK had equal pay legislation and protection against sex, race and disability discrimination before the EU; the extension of protection to religion, sexual orientation and age is influenced by the EU but it is difficult to imagine our government concluding that employers should be free to discriminate on these grounds (although a reintroduction of a statutory retirement age may be appealing to some). It is possible that a cap on compensation for discrimination claims may be introduced, but this is speculation only.

Family Leave: the UK had rights to maternity leave and pay before the EU and our family leave provisions are more generous that those in the EU in many respects; the right to shared parental leave and the right to request flexible working are home grown. There is no reason to think these laws will change post Brexit. In fact – consultation on whether shared parental leave should be extended to working grandparents has been postponed until after the referendum but may see wider family leave provisions being introduced!

TUPE: protection for employees caught up in a business sale has come from the EU and there can be an advantage to employers in knowing that staff will move with the business as it means less disruption, the seller doesn’t have to fork out for redundancy payments and the buyer doesn’t lose skills from within the business. However, the application of TUPE to changes in service providers can be problematical, particularly on smaller contracts, and if we do leave the EU I would like to see some modifications to make this less onerous for employers.

Holidays: the minimum holiday entitlement in the EU is 4.0 weeks (or 20 days for a full timer) whereas here it is 5.6 weeks (or 28 days for a full timer). Prior to the Brexit campaign, there had been discussions about reducing our minimum holiday entitlement back down to 4.0 weeks and so there may be some movement on this regardless of the referendum. However, if we leave the EU we may see the introduction of UK legislation to modify the recent European cases requiring inclusion of commission and overtime in holiday pay, and accrual of holiday entitlement during sick leave. Again, this is speculation only.

Agency Workers: the obligation to treat agency workers equal to employees after a qualification period of 12 weeks is from the EU and is reasonably unpopular. If we leave the EU there is a chance that this law could be repealed.

Freedom of Movement:if we leave the EU, UK nationals living and working in European countries would no longer have an automatic right to live and work there and may be forced to return home. Equally, European nationals living and working in the UK could be asked to leave. What seems more likely is that all involved will have to apply for citizenship status in their country of residence and we might see modified systems for immigration going forwards.