Brexit – Employment and Labour Implications

Three years ago my Keynote – Post-Brexit US-UK Trade Agreement: Employment and Labour Implications – was issued on the Keystone Law website. At that time I, and most other people, did not anticipate that it would take until now, following two general elections, much in-political party wrangling and decisions of the UK Supreme Court for the UK to finally exit the European Union (Brexit).

My previous Keynote remains generally applicable; however, a US-UK Trade Agreement has yet to be negotiated and concluded.

This Keynote looks at the employment and labour implications within the UK following on from Brexit. The earlier European Union (Withdrawal Agreement) Bill (WAB) has been reintroduced following the recent opening of Parliament on 19 December 2019. The Bill had passed its second reading in the House of Commons during the previous Parliamentary session but fell when Parliament was dissolved prior to the December 2019 General Election. The re-introduced WAB passed its second reading on 20 December 2019.

The previous WAB contained provisions to safeguard existing EU-derived workers’ rights (an issue much debated and flaunted by the Labour Party) in the form of a duty on the Government to consult with unions and employers’ organisations and issue, if appropriate, a “non-regression statement” for any future employment bills. Those protective provisions have now been entirely removed from the new version of the WAB. The Government has stated that it intends to legislate separately to protect and enhance workers’ rights in a new Employment Bill and that removing these provisions from the WAB is simply in order to speed up the progress of the WAB.

The re-introduced and revised WAB seeks to amend the position on retained EU case law after the implementation period and will give ECJ decisions the same status as a UK Supreme Court decision. However, the current WAB would grant the Government a power to specify in regulations that certain lower courts and tribunals would not be bound by ECJ cases, or by existing domestic case law relating to EU-derived workers’ rights. This could be used by ministers to give employment tribunals more of a free hand to override ECJ and domestic cases on EU-derived employment rights, particularly in cases relating to the Working Time Regulations 1998 which has for many years presented UK courts with conundrums.

Like much of Brexit and, I anticipate, post-Brexit legal issues, the devil will very much be in the detail.

What appears clear, however, is that subject to any unexpected material changes in the WAB and it becoming law, changes in EU-derived workers’ rights will now happen. Let us therefore first look at what are EU-derived workers’ rights and then which of those workers’ rights are likely to be subjected to change.

The UK joined the EU (then called the European Economic Community (EEC)) on 1 January 1973 and will have exited 47 years later. During that time period a considerable number of EU-derived workers’ rights have become an integral part of UK law, having been implemented into UK law as required by the relevant EU Directives or automatically but rarely by Regulation. Below is an alphabetical list of the common names of the principal EU laws in this area:

Agency Workers Directive
Business Transfers Directive (or Acquired Rights Directive)
Collective Redundancies Directive
Contracts of Employment Directive
Data Protective Directive
Enforcement of Workers’ Rights Directive
Equality Directive
Equal Treatment Directive
European Works Councils Directive
Fixed-term Workers Directive
Framework Health and Safety Directive
General Data Protection Regulation
Information and Consultation of Employees Directive
Parental Leave Directive
Part-time Workers Directive
Posted Workers Directive
Pregnant Workers Directive
Racial Discrimination Directive
Trade Secrets Directive
Working Time Directive
Young Workers Directive

These EU-derived workers’ rights now form part of UK law and will remain part of UK law until such time as the laws are changed by Parliament or by decisions of the higher courts. Directives required EU Member States to implement into their domestic laws the requirements set out in the directive, but this was a minimum (floor) requirement. Accordingly, many EU Member States (including on occasion the UK) when implementing directives went further than the bare minimum set by the directive, thereby granting additional rights.

Many of the laws covered by the applicable directives have become such an accepted and integral part of UK employment law and HR practice that I would anticipate few, if any, changes in the areas of redundancy, contracts of employment, data protection, equality and discrimination, parental and maternity protections, and young workers.

However, I believe that over the next few years we should anticipate changes (and some significant) in UK employment law in the areas emphasised in the above list as the UK commences trading as a non-EU Member State with an eye on perhaps creating a more attractive jurisdiction for foreign investment in addition to resolving some difficult and thorny areas of EU-derived workers’ rights which have, over the years, presented difficulties.

In my view the EU-derived workers’ rights areas for likely changes are:

Business Transfers or Acquired Rights (known in the UK as TUPE)
Agency Workers (possibly)
European Works Councils
Information and Consultation (relating to redundancy, TUPE and domestic works councils)
Health and Safety
Posted Workers
Working Time (holidays, working days/hours and holiday pay)
Fixed-term Workers

If you would like to discuss more about the employment and labour implications within the UK following on from Brexit, please contact Malcolm Mason using the contact details below.