Opinion: How would 'Brexit' affect UK Employment laws?

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By William Downing, employment lawyer and partner, Blake Morgan.

On 23 June voters across the UK will decide whether the UK should remain in the European Union (EU) or leave it.

What difference will the UK leaving the EU make to employment laws?

The changes that could be made are heavily dependent on any trade agreement reached in the event of a vote to leave the EU. Countries like Norway and Switzerland are not in practice free from the constraints of EU Employment laws. If, exceptionally, the UK managed to negotiate a different deal, some of the EU-derived rights that could be in the firing line are: 

  • Collective consultation rights
  • Certain Working Time rights
  • Some aspects of the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE)
  • The Agency Workers Regulations 2010
  • Some Health and Safety regulations deemed to be an unnecessary burden

The UK is required to give a minimum of two years’ notice of withdrawal from the EU. If there was a vote to leave the EU, this is likely to be a period when the UK would seek to put in place new trade agreements, potentially including access to the Single Market via membership of the European Free Trade Association (EFTA) like Switzerland, and/or the European Economic Area (EEA) like Norway.

However, one of the key points made by commentators is that ongoing participation in the EFTA or EEA may still require the UK to have in force legislation equivalent to the employment and social laws of the EU, as a condition of being entitled to participate.

So, if the government chose to make changes, what are the employment laws that could be affected?

Assuming any trade agreements would not be a hindrance, the question of which laws might be affected is really a political one. Unfair dismissal, the national minimum wage, equal pay, sex, race, and disability discrimination were all introduced in the UK independently of EU law, even though some have subsequently been developed by it.

Some discrimination rights emanated from Europe (such as religion or belief, sexual orientation and age discrimination) and the way society has developed would likely make any attempt to repeal such laws hugely unpopular. What is perhaps more likely is a tinkering around the edges, such as a cap on compensation for successful discrimination claims, which is currently prohibited by EU law. 

The Working Time Regulations, which have been a particular target for Brexiteers, already contain a number of flexibilities and the principles of having rights to rest breaks and paid holiday are largely uncontroversial, but could be clarified further. 

Despite regular complaints by employers about family friendly rights, changes to those rights are unlikely, given that they are generally more generous than EU law (such as maternity leave and pay) or introduced independently of it (such as adoption leave and shared parental leave).

Those trying to persuade voters to remain in the EU have talked of losses to jobs, damage to workers’ wages and rising prices. Legally they are potentially at risk – but even if there were no conditions against repealing the EU-derived laws, politically it would be a brave government to scale back all but the most minor of workers’ rights and burdens on business.

Nevertheless there may be areas where a deregulatory-minded government would not change substantive rights, but would introduce certain exemptions for micro-businesses.

Whilst the future is uncertain and heavily dependent on any trade agreement reached in the event of a vote to leave the EU, any changes to employment law are not likely to be dramatic.

There would perhaps be no more than a gradual tinkering of certain areas where, in the government’s opinion, EU law (or the interpretation of it by the European Court of Justice) has just gone a step too far. 

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