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Brexit White Paper: implications for employers

The Government has published its White Paper on the basis on which it proposes to approach negotiations with the EU on Brexit.

There are three parts of the White Paper which will be of particular interest to employers:

  • Controlling immigration;
  • Securing rights for EU nationals in the UK and UK nationals in the EU; and
  • Protecting workers’ rights.

Controlling immigration

As already widely reported, the Government will seek to end the free movement of people in order to control the numbers of people who come to the UK from the EU. Migration of EU nationals will be subject to UK law. However, there is no indication at this stage whether EU nationals will simply become subject to the same points-based system which currently applies to non-EEA nationals, or whether the rules will be modified for EU nationals. The White Paper says “We will create an immigration system that allows us to control numbers and encourage the brightest and the best to come to this country, as part of a stable and prosperous future with the EU and our European partners…We are considering very carefully the options that are open to us to gain control of the numbers of people coming to the UK from the EU. As part of that, it is important that we understand the impacts on the different sectors of the economy and the labour market. We will, therefore, ensure that businesses and communities have the opportunity to contribute their views.”

One possibility is that Tier 3 of the points-based system, which was intended for low-skilled positions but was not brought into operation, could be used to facilitate the continued employment of migrant workers from the EU in sectors which currently rely heavily on them.

New immigration requirements may be subject to phased implementation.

Securing rights for EU nationals in the UK and UK nationals in the EU

There are an estimated 2.8 million EU nationals resident in the UK, and an estimated 1 million UK nationals long-term resident in other EU countries. The White Paper notes that the Government would have liked to reach a reciprocal deal on securing their status before beginning negotiations on Brexit but this has not proved possible.

Protecting workers’ rights

The White Paper states that the Government has committed not only to safeguard the rights of workers set out in European legislation but to enhance them. The White Paper also notes that UK law already goes beyond what is required by Europe in some respects, including the right to 5.6 weeks’ paid annual leave, 52 weeks’ maternity leave and shared parental leave and pay. The Great Repeal Bill, which will convert all existing European law into domestic law when the UK leaves the EU, will maintain the protections and standards that benefit workers.

The Government also makes specific reference to the Taylor review of employment practices in the modern economy, which will consider how employment rules need to change in order to keep pace with modern business models, such as: the rapid recent growth in self-employment; the shift in business practice from hiring to contracting; the rising use of non-standard contract forms and the emergence of new business models such as on-demand platforms.

There is also reference to ensuring that the voices of workers are heard by the boards of publicly-listed companies for the first time, albeit watered down from the original proposal to have workers on boards.

In the short to medium term, it appears that the intention is that very little will change in UK employment law. Leaving the EU does, however, give more flexibility for future change especially as the Chancellor Philip Hammond told German newspaper Welt am Sonntag recently that the UK could be “forced to change [its] economic model” if it does not get the right deal in negotiations with the EU, widely assumed to be a reference to cutting business taxes and reducing employment rights.

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