What if Britain has chosen Brexit and begins the process of withdrawing from the EU. What are the implications for employment law?
“Workers rights” featured time and time again in the referendum debate. For example, Jeremy Corbyn campaigned on the basis that voting Remain would protect “paid holiday, the anti-discrimination legislation, the maternity leave, the paternity leave and particularly environmental protection”. For Leave, Boris Johnson said we needed to take back control of our rights from the European court.
Should Britain chose Brexit, we will set sail on unchartered and untested territory. There will be intense debate over the coming months, or even years, as to what the UK’s future relationship with the EU will be.
It is too early to say what the employment law landscape would look like after Brexit. While there has been talk of the UK being able to rip up the statute book and start again in relation to EU derived or EU compliant employment law; this is a theoretical, rather than realistic, possibility.
Our immediate message to our clients is “don’t panic”. The last thing we would advise is for any “knee-jerk” reaction by employers to address life post Brexit.
The UK has been part of the EU for the last odd 44 years, and many employers and employees – including CEOs, MDs, Directors of HR – and employment lawyers have never known anything else. They have come of age with an understanding, and acceptance of, EU standards and law. Much of this has became firmly entrenched in the national consciousness, and championed by Government – for example, the equal treatment legislation, and the prohibitions on unlawful discrimination, harassment or victimization. Indeed, the UK already had much of the law vaunted as “European”, before the EU required it, such as the right to paid holidays, and the right to paid maternity leave. Again, in several important areas, (again including holiday and maternity leave entitlements), the UK provides more generous workers’ rights than the EU requires.
Even where many of these rights are not the accepted norm, it would be wrong to characterise the government as being able to throw off the shackles of Europe and free to scrap employment legislation as it sees fit. Far reaching changes to the employment law landscape would face the usual political and practical obstacles, and could face resistance from businesses, unions, and politicians on both sides of the house. It is hard to imagine, for example, an argument that employers should be free to discriminate on grounds of pregnancy or sexual orientation being accepted.
Add to this, the fact that employees are now more than ever aware of their individual rights. There is a growing emphasis on the individual and human rights in the workplace and the scope of discrimination law is continually increasing. The UK does not have a Human Bill of Rights and this gap is, in part, filled by the current employment law regime.
It also seems likely that a future relationship with Europe will be, to some degree, conditional upon compliance with EU standards and principles, which may well include employment laws, and also related areas such as data protection, trade secrets and confidential information.
National laws – Candidates for review/scrapping?
That said, it looks unlikely that it will be “business as usual” in all respects. The legislation of the EU and the jurisprudence of the European Court of Justice (ECJ) have had a profound and far-reaching effect on our national employment law. It is perhaps not surprising that some of these developments have been more welcomed and embedded into our national law than others.
There are some pieces of EU-derived employment law, which are likely to now be considered candidates for scrapping, or rewriting.
The Working Time Regulations 1998 must be high on the list. The UK government has never had much sympathy with this legislation. As long ago as 1996 it argued – unsuccessfully – in the ECJ for the directive’s annulment.
From the very first discussions, the UK government was not in favour of the imposition of maximum weekly working hours (48 hours a week); seeing it as an unwelcome interference in business and sovereignty. It successfully secured an ‘opt-out’ to this, but has been forced to defend that position ever since.
The opt-out has been heavily relied upon in the UK. The neutralised policy is now likely to come under review. In our view, it is very unlikely that the Regulations will be wholly abolished. More likely, they will be watered down.
The 48-hour week aside, the Regulations provide rights to statutory paid holiday and these are surely too secure to be considered under threat.
However, not all aspects of statutory holiday delight employers. How it works in practice has become one of the most technically complex and debated issues in employment law, with new developments and cases every year. It’s hard for employers to know where they stand with this measure. Further, the Regulations have been found not to comply with the European directive in various respects, which only increases the uncertainty.
Over the years, the ECJ has looked at various situations and asked how the right to annual leave works, keeping its focus very firmly on the health and safety purpose which sits at the heart of the legislation. This has led to some surprising and, to many employers, frustrating results, such as the provision for workers on sick leave and maternity, or other statutory leave, to continue to accrue holiday. There are also complex decisions concerning on-call time, compensatory rest and holiday pay. Such decisions – which some employers have conformed with begrudgingly – may well now be addressed in a domestic legislative ‘rewrite’ and court cases following Brexit.
Discrimination and Equal Treatment
While the basic tenets and principles of equal treatment may now be pretty firmly enshrined in the UK and it is generally accepted that “thou shall not discriminate”, it is also right to say that the decisions from the ECJ have protected individuals’ rights, and extended these, often fundamentally so. This reflects Europe’s founding commitment to equal treatment as enshrined in its Treaties. Examples here include rights in respect of equal pay, maternity, pregnancy, part-time workers and long term sickness.
During the campaign, Boris Johnson said we “need to weigh in on all that stuff, all that social chapter stuff” and the employment minister, Priti Patel, said: “If we could just halve the burdens of the EU social and employment legislation we could deliver a £4.3bn boost to our economy and 60,000 new jobs….” It will now be a case of “over to them” to see if and how these aims will be achieved.
Other laws likely to be appealed or reviewed include the Agency Workers Regulations, certain aspects of the Transfer of Undertakings Regulations and of collective consultation requirements, and the obligations in respect of information and consultation bodies. These are all examples of EU-derived legislation, which has never gone down well with businesses, and which has not been absorbed seamlessly into our national approach. Other possible candidates include part-time workers’ legislation and fixed-term employees’ legislation.
However, as the referendum and the debate leading up to it have showed, predictions are dangerous, and we will have to wait and see.
Jonathan Maude is a Partner at Vedder Price and leads the group’s employment team in the firm’s London office. Mr. Maude regularly advises across the full spectrum of employment law-related issues in the contentious and non-contentious spheres, and advises corporate clients on complex strategic human resource-related matters. He also provides training for clients’ employees on the full range of employment law matters, advises clients on global mobility issues as well as on data protection and privacy matters. Mr. Maude is a regular commentator in the press on employment law, gives seminars, and has appeared on national television because of his knowledge of the subject area.
Esther Langdon is a Senior Associate in the Labor and Employment group of Vedder Price’s London office. Ms. Langdon advises clients on all aspects of employment law, with a particular emphasis on contentious matters before the Employment Tribunal and the High Court. She also advises on the full range of personnel matters, carries out comprehensive reviews of employment documentation, is experienced in advising on employment issues arising from corporate transactions, and advises and provides training for clients and their employees on equal opportunities and diversity in the workplace. Ms. Langdon also provides full-spectrum advice to clients on privacy, technology and data security matters.
Vedder Price is a leading law firm, with offices in the UK and USA. Jonathan Maude is Partner and employment law lead; Esther Langdon is a Senior Associate in the Labour and Employment group