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Thinking Ahead Brexit and UK Employment Rights

Mon, 2016-10-31 12:40

US business leaders are often frustrated by the significant legal protections given to workers working within the EU. A decision of the UK to leave the EU, colloquially called “Brexit”, would (subject to the outcome of any trade negotiations) give the UK the ability to make its own laws in the employment space. Given that much of the UK employment regulation emanates from Europe, there could be very different ground rules for engaging workers in the UK in the future.

In this note we have tried to estimate what an exit from the EU could mean for employment rights in the UK in the long-term. We have assumed a government committed to gaining international competitive advantage by deregulation where politically feasible, along the lines of the US model.

We believe that the following laws, and potentially others, could be put to the sword:

–        uncapped compensation in discrimination and equal pay cases

–        age discrimination in compulsory retirement

–        some maternity rights, such as the right to accrue holidays during maternity leave, and preferential treatment in redundancy

–        protection of part-time workers, save where indirect sex discrimination provisions apply

–        collective consultation at times of business change

–        protection of workers on fixed-term contracts

–        agency worker protections

–        the regulation of working time, including maximum hours, rest breaks and paid annual leave

–        protections of business mergers and acquisitions in the transfer of undertaking

 

Depending on the model adopted regulating the UK’s future relationship with the EU, UK employment rights could well become turbulent and more restricted. However, it is unlikely that it would be a one-way street for businesses. Given the protections that have long existed in the UK, the national workforce might not take a diminishment of rights lying down. The prospect of disgruntlement driving union membership and greater collective bargaining could be visible on the horizon.

Contributed by eversheds.com

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