As the country is in the process of negotiating a deal on leaving the EU, one of the key questions within the workplace is what will become of the significant body of law in the UK which is derived from Brussels?
The current position
In reality, there is little if any change to Employment Law as existing legislation and case law continues to apply. One of the most notable elements of EU derived law affecting employment is the Working Time Directive.
Before the Working Time Directive was implemented by UK legislation, UK workers were not afforded a statutory right to paid annual holiday. The effect of the Directive was to ensure that all workers are entitled to at least 20 days’ paid annual holiday. Notably, the UK Government allows for 28 days entitlement inclusive of bank holidays which demonstrates the UK Government attitude to fine tuning and expanding on aspects of EU law. Further, another example of the manner in which the UK Government has “tweaked” EU law is through the UK Government opting out of the provision that a working week is limited to 48 hours.
What changes will there be to Employment Law following Brexit
Agency workers
The area of employment law where there is likely to be a complete overhaul or revocation is the Agency Workers Regulations 2010 as they remain widely unpopular with businesses and workers themselves.
Transfer of undertakings
Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) is an area of Employment Law which appears divisive. However, the option for employers to transfer the workforce (employees) in circumstances when a business changes hands or is contracted out remains useful and is incorporated and priced into many commercial outsourcing agreements. For this reason. Although there may be some businesses out there who advocated to abolish TUPE outright, the more likely and conventional outcome will be that the Government will make small changes with the aim of making TUPE more business friendly.
Discrimination and family leave
The thought of a wholesale repeal of equality protection or family leave is both improbable and controversial and it is highly unlikely that the Government will take such an approach.
It would appear nonsensical for an employer to argue that they are free to discriminate and any change to discrimination law is unlikely to be repealed. However, following Brexit there is scope for little modifications such as a cap being imposed on the compensation for unlawful discrimination as currently there is no cap on the amount that an individual can claim in compensation for an unlawful discrimination claim.
Rights to parental and family leave in the UK are a mixture of rights deriving from the EU and rights which originate in the UK. UK maternity leave and pay preceded the EU rights and are more generous in some respects. The new right to shared parental leave and the right to request flexible working are both purely domestic in origin. Accordingly, there seems little political appetite for their repeal or even for watering them down.
Holidays and working time
As discussed earlier, the right to statutory paid holiday under the Working Time Regulations 1998 (“WTR”) is also now broadly accepted. However, there are aspects of this right, and other rights under the WTR that the Government might want to amend if not prevented from doing so by EU membership. The Government might choose to tweak these laws to make them more commercially acceptable, such as by retaining a right to paid holiday based on basic pay whilst limiting rights to accrue and carry over holiday pay. The UK may also wish to remove the cap on weekly working hours under the WTR. It is less clear that there is a demand to limit the WTR rights to other rest breaks or the protections for night workers.
Collective redundancy consultation
Collective redundancy consultation obligations are not particularly onerous and it is unclear what is to follow in a post Brexit work environment. Given that this is a right which employees are altogether unfamiliar with, there is scope for its removal, a step which is likely to be challenged by trade unions.
Table of key employment rights – what might change?
If a future deal gives the UK scope to diverge from EU employment law (which may not be the case, as explained above), this table sets out what might happen to some key employment rights, although changes would of course be highly dependent on the future political make-up of Parliament.
| Key right | Potential impact of Brexit |
| Unfair dismissal | UK-based right – does not stem from the EU: Brexit will have no direct impact. |
| Minimum wage | UK-based right – does not stem from the EU: Brexit will have no direct impact. |
| Unauthorised deductions from wages | UK-based right – does not stem from the EU: Brexit will have no direct impact. |
| Statutory redundancy pay | UK-based right – does not stem from the EU: Brexit will have no direct impact. |
| Industrial action | The detailed provisions on strike action are purely UK-based and Brexit will have no direct impact. |
| Paternity leave | UK-based right – does not stem from the EU: Brexit will have no direct impact. |
| Shared parental leave | UK-based right – does not stem from the EU: Brexit will have no direct impact. |
| Flexible working | UK-based right – does not stem from the EU: Brexit will have no direct impact. |
| Pregnancy and maternity | Mixture of EU and UK-based rights.
UK rights go further than the EU minimum, for example providing 52 weeks’ maternity leave as opposed to the EU minimum of 14 weeks. Wholesale changes seem unlikely, however there may be a reversal of the current entitlement of workers on maternity leave to carry-over unused holiday entitlement to another leave year.
|
| Parental leave | EU-based right providing up to 18 weeks’ unpaid parental leave for each child – in the UK the age limit for this was increased in 2015 so it can now be taken up to a child’s 18th birthday. Given that the right is unpaid (which limits its actual uptake), and the age limit was recently increased in the UK, it is unlikely to feature high on a list of potential targets for change. |
| Working time | EU-based right.
The UK has its well-known opt-out provisions in relation to the 48-hour working week, and a future Government might be keen to remove this limit altogether. There may also be calls to change the rules which mean that some on-call and travelling time counts as working time. |
| Holidays and holiday pay | EU-based right.
Basic holiday provision is unlikely to be a target, given that the UK exceeds the EU minimum (providing 5.6 weeks’ holiday as opposed to the EU minimum four weeks). However, there may be a desire to reverse the current entitlement of workers on long-term sick or maternity leave to carry-over unused holiday entitlement to another leave year. A future Government might also seek to exclude payments such as commission and overtime from holiday pay, contrary to the current direction of EU travel. |
| Collective redundancy consultation | EU-based right.
Consultation periods were reduced in 2013 from 90 to 45 days for redundancies of 100 or more employees. This may have dampened the appetite for further change, although there might be calls to increase the threshold number of affected employees, so that collective consultation is only triggered for redundancies of 100-plus rather than 20-plus. Trade unions would be likely to strongly oppose any change. Other collective consultation rights EU-based rights, implemented in the UK via: • The Transnational Information and Consultation of Employees Regulations 1999 • The Information and Consultation of Employees Regulations 2004 |
| TUPE | EU-based right.
The Government previously stepped back from proposals to repeal the rules on service provision changes (which go beyond the EU minimum) on the basis that the rules provided certainty. We might, however, see changes making it easier to harmonise terms and conditions following a transfer, or the watering-down of information and consultation rights. |
| Rights on insolvency | EU-based right of employees to claim certain sums from the Secretary of State if their employer becomes insolvent. |
| Agency workers | EU-based right.
The right of agency workers to the same basic working conditions (for example, pay and annual leave) as equivalent permanent staff after 12 weeks wasn’t popular at Government level when it was introduced, and is a likely candidate for change if a future Government has a deregulatory agenda. On the other hand, given the low level of employment protection available to agency workers at present, a Government from the opposite end of the political spectrum might consider it a priority to increase protection (which is possible under current EU law). |
| Discrimination | The UK had protection against sex, race and disability discrimination pre-EU, but these rights have been extended by the EU, and additional protections added, including discrimination on the basis of age, religion / belief and sexual orientation.
Discrimination laws have become accepted in workplaces and society as a whole, and wholesale changes seem unlikely. However, there may be a desire to introduce a cap on discrimination compensation (which is not currently allowed under EU law), similar to that for unfair dismissal. Some commentators have indicated that age discrimination might be a target as there is less political consensus on the need for this, but our view is that given the political desire for older workers to continue in employment beyond traditional retirement age, this seems unlikely.
|
| Fixed-term employees | EU-based right protecting fixed-term employees against less favourable treatment in comparison to permanent employees.
Those arguing for a removal of ‘red tape’ and an increasingly ‘flexible’ labour market may target these rules. |
| Part-time workers | EU-based right protecting part-time workers against less favourable treatment in comparison to full-time workers. Those arguing for a removal of ‘red tape’ and an increasingly ‘flexible’ labour market may target these rules, however, some female part-time workers may still be able to claim that any less favourable treatment amounted to indirect sex discrimination (since the majority of part-time workers tend to be female). |
| Data protection | EU-based right – the UK Data Protection Act implements the EU Data Protection Directive.
The EU General Data Protection Regulation (GDPR) is due to come into force in May 2018, introducing tougher rules for organisations that handle personal data, and higher penalties. It seems likely that businesses will need to continue preparing for the introduction of the GDPR. The GDPR is due to have direct effect in member states without the need for any national implementing legislation and, as the exit process may not be complete by May 2018, the GDPR may take effect as planned. If the status of the UK has changed, it may have adopted GDPR (or a UK equivalent) to ensure that (for EU data protection purposes) it is considered as adequately protecting data. Even in a scenario that sees the UK entirely severing ties with the EU, the GDPR may still be relevant in some circumstances, such as where a UK organisation processes the personal data of EU citizens. The Information Commissioner has stressed the importance of international consistency on data protection and made clear that reform of UK law remains necessary.
|
| Trade Secrets | The UK was due to implement a new EU Trade Secrets Directive by June 2018.
The aim of the Directive is to: • harmonise the law of trade secrets throughout the EU – there is no legislation on this subject in many EU states, including the UK which relies on common law and precedent; • facilitate trade, promote innovation, investment and cross-border collaboration; and • assist in the prevention of theft of trade secrets and set out a clear and consistent set of civil remedies and sanctions. What will happen now is unclear and may well depend on political negotiations, but it may be that regardless of the UK’s position post-Brexit, it adopts laws similar to the new Directive, if it considers this to be in its best interests. Even if it does not do so the law in the UK is already fairly consistent with the Directive’s provisions. |
To find out more about how the Employment Team at Parker Thomas can help you, contact us online, or speak to a member of our Employment Department by calling 0207 242 5462 or e-mail your employment enquire(s) to Jawad.Asif@alison-law.co.uk.
