The impact of Brexit – an employment law perspective

Now that the immediate dust from the momentous decision by the UK public to leave the EU has settled, employment law specialists are surveying the horizon; what changes to the legislative landscape might be coming and how might they affect businesses in the UK?

We now know that the Government is unlikely to trigger Article 50 this side of Christmas and then we will remain a part of the EU for two years. We also realise that there may be pressure on the UK to comply with many EU inspired employment laws as part of any future relationship we have with the European trading block. Leaving such speculation aside, which of the multitude of laws derived from EU legislation and interpreted by the CJEU could be on the radar for amendment or outright repeal?

Agency Worker Regulations

A relative new comer in terms of employment legislation, there are many who believe that Agency Worker Regulations (AWR) may be repealed in the first wave of legislative amendments. Whilst many EU derived laws are enjoyed positively by employees/workers, AWR right are not especially beloved by workers, whereas businesses and recruitment agencies alike find them cumbersome and restrictive.

Weekly working hours

The Working Time Regulations 1999 implemented the EU Working Time Directive, which specified that member states should ensure that workers do not work more than 48 hours per week. The UK introduced an opt- out mechanism to get around this with a workers’ consent, but this is a little cumbersome. UK workers, especially those in the private sector, do not appear to be especially wedded to this right. This aspect of legislation may come under scrutiny.

Holidays

Also within the Working Time Regulations is the issue of minimum annual leave. The EU imposed a Europe wide minimum of four weeks (inclusive of bank holidays) paid leave, per annum. The UK implemented this but actually went further by later increasing the minimum to 5.6 weeks (or four weeks plus eight days bank holidays). It is therefore very unlikely that the Government will look to reduce this, not least because this is a right ingrained in the nation’s psyche and therefore any attempts to remove it would be deeply unpopular. However, and whilst the directive states that holiday cannot be carried over into the next year, a series of EU judgements have contradicted this, specifying that holiday continues to accrue during extended leave such as sick leave, even into the next holiday year. Also, as we reported back in November 2014, EU and UK courts (interpreting Article 7 of the Working Time Directive) have made rulings to the effect that holiday pay must be calculated by taking into account commission and overtime payments during the rest of the year. These enhancements via case law may well be reversed within future legislation.

TUPE

The rules by which workers are protected when the identity of their employer changes (for example after a sale of a business) derive from the EU and are complicated and disliked by legal practitioners and business owners.  This legislation could benefit from some simplification and a more business friendly bias, particularly around the areas of the restriction against changing terms of employment and the application of TUPE in a service provision change context.

Discrimination

As we reported pre-Brexit, these laws derive to a great degree from domestic equality legislation (i.e. Sex Discrimination Act 1975) and these laws have been rationalised and expanded upon, culminating in the Equality Act 2010 and its nine protected characteristics, ever since. It appears unlikely that these will come under any significant attack.