Only a few weeks to go now before the UK is asked to vote on whether to remain in the EU.

I thought it would be interesting to have a look at what is being said about the impact of a Brexit on businesses and employment law. It is not my intention to give any view on the rights and wrongs of leaving or otherwise, but instead to consider what might happen in terms of our employment law.

Because of the uncertainty surrounding the potential outcomes of leaving the EU and how this may affect the UK economy, there is bound to be concern amongst businesses, but the outcome of an exit in terms of employment law would really depend on decisions made between the two parties through a lengthy negotiation process; for example the UK may want to join the European Economic Area and European Free Trade Area and therefore keep economic ties and European single market trading.

If this happens, the UK would still be bound by some of the EU policies that govern our employment law. Certainly if negotiations lead to a favourable trade deal for the UK, the EU would call on the UK not to seek competitive edge over Member States by decreasing employment standards.

There is a great deal of EU employment law incorporated into UK law which seems to indicate that an ‘exit’ vote would bring about extensive changes and consequences. However, much of the EU employment law forms ‘primary legislation’ in the UK as Acts of Parliament and can therefore only be changed if our Government chooses to do so.

Many of these laws are well incorporated within our legal system in the UK and the Government would likely want to avoid any concern and controversy amongst businesses that amending the system would cause. Eradicating or limiting protections under the Equality Act 2010 or reducing parental rights, for example, would be extremely unpopular and it’s therefore quite likely that any changes would happen over time as the need or concerns arise.

Some European Acts form ‘secondary legislation’ within the UK, such as the Working Time Directive, which determines the number of hours employees can work. If the UK exits the EU, these Acts may be revoked and in this case, the regulations would disappear unless the Government made the decision to recollect them; again however, this would be an unpopular move with a large number of employees.

There are some laws such as the National Living Wage that were put in place by our own Government and an exit would not have an effect on these.

One option that the Government may choose is to remove more unpopular aspects of EU based legislation, for example, the current right that employees on sick leave have to earn holidays and roll untaken annual leave over into the next year, the requirement to include some types of overtime in holiday pay calculations, and the Agency Workers Regulations 2010, giving agency workers similar employment rights to permanent employees which is unpopular with both employers and the Government.

Any changes that are made will take time to implement so there’s no urgent need for employers to do anything in preparation for a possible exit. It would in fact take two years for the UK to leave the EU and so any changes to our employment law wouldn’t come into force until after this notice period.

It is anticipated that our Government would put legislation in place to maintain the current situation throughout a period of transition, allowing EU regulations and legislation used to implement directives to remain in place, certainly for a period of time.  There is also a point worth making that a good deal of our employment law is written into employment contracts which cannot be breached and would therefore remain in place despite an exit from the EU.

If there is an exit though, it will be worth looking out for possible changes so that you don’t miss anything.   

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