What are the implications of a no-deal Brexit for UK employment law?

With the Prime Minister still clear that he is prepared to leave the EU at 11pm on 31 October 2019 with or without a deal, businesses should now be preparing for a no-deal scenario in the event that an agreement cannot be reached.

Whilst there are many issues that a business will need to consider, for example your supply chain, from an employment law perspective the key topics are:

  1. EU staff in the UK: if you have staff from the EU then you can support them by providing or signposting guidance on the EU Settlement Scheme. The Scheme allows EU citizens to remain indefinitely if they have lived in the UK for five years or more. Pre-settled status will be granted for those who have not lived in the UK for five years; once they have met the five-year threshold then they will be granted settled status. These requirements do not apply to Irish citizens since they are already considered settled in the UK due to an existing agreement with Ireland regarding a common travel area. For all other EU staff, employers should inform the affected employees that, in the event of a no-deal Brexit, they must apply for the Scheme before 31 December 2020 and not 30 June 2021 (the deadline to apply in a scenario where the UK leaves with a deal). Employers should also be mindful that any new EU staff joining their business may need to apply for Pre-Settled Status and make sure they come to the UK before 31 October in order to be eligible under the Scheme.

  2. British staff in the EU: EU member states will be providing residence permits to British citizens living in the EU on the date of Brexit, therefore in the short term this will not be affected by a no-deal scenario. However, since arrangements will vary between each country and they still have not been finalised, in the long term it would be prudent for an employer to keep on top of any developments.

  3. Changes in UK employment law: even if the UK left the EU without a deal the European Union (Withdrawal) Act 2018 will convert all EU law as it stands before Brexit into UK law. Therefore, for the time being, staff will still have the same rights in the event of a no-deal Brexit in relation to annual leave, holiday pay and rest breaks, family leave entitlements, health and safety of workers, discrimination and harassment in the workplace, TUPE, and agency, posted, part-time, fixed-term and young workers. The Government intends to make only small amendments to the language of UK employment legislation to reflect that the UK is no longer an EU member state after Brexit. These changes will not affect existing employment rights, simply providing for greater legal certainty and allowing for a smooth transition.

    However, this only reflects the Government’s short-term position on employment law matters post-Brexit; the long-term position is not clear and it will depend on which political party is in power in the future. Whilst it is theoretically possible for a post-Brexit government to “scrap” all EU-derived employment law rights, this is highly unlikely in the circumstances due to the potential political backlash. Also, UK legislation on equality provides more rights to workers than the EU’s minimum requirements. This suggests that whilst the Government could get rid of these rights, it is unlikely that they will since many areas of UK equality employment law already go further than required and provide greater protection than the EU.