After three years of wrangling it now looks certain that the UK will leave the EU at the end of this month.
And for businesses of all shapes and sizes, that’s going to bring some sizeable changes to the way they employ people, the rights those workers enjoy and the way in which they are enforced.
It won’t all happen overnight of course – in fact, far from it.
As we leave the European Union we will remain aligned to its rules for the rest of this year while negotiators try to hammer out a trade deal with our former partners in Europe.
That will guarantee at least 11 months of stability – but wise businesses should start preparing for the changes which will come in 2021 now to make sure they are ahead of the game.
Those changes are certain to involve new employment laws, indeed the Government made as much clear in the pre-Christmas Queen’s Speech which laid out its policy plans for this session of Parliament.
Briefly, they include:
• The end of freedom of movement once we have left the EU. From January 21 EU citizens arriving in the UK – with the exception of those from Ireland - will be subject to the same UK immigration controls as the rest of the world. This is likely to have a major impact on the ability of companies to attract and employ the sort of European labour which has proved so popular in recent years.
• Workers are more likely to get the opportunity to work flexibly under reforms announced as part of the Government’s Good Work Plan. Employees will get the right to request a more stable contract once they have clocked up six months’ continuous service including a guaranteed number of hours every week or regular set working days. Stricter enforcement is also likely to crack down on rogue employers who treat workers poorly and there is set to be more focus on helping working families achieve a good work-life balance.
• The National Living Wage will be increased to two-thirds of average earnings – likely to be £10.50 an hour – and extended to cover all those over the age of 21. The Tory manifesto ahead of the election suggested this would give up to four million people a £4,000-a-year pay rise by 2024.
• The Pensions Regulator is likely to be given sweeping new powers to ensure that employers meet their responsibilities and protect defined benefit schemes sufficiently into the future. New powers could include criminal and civil sanctions for those found to have put schemes at risk without an adequate explanation, including maximum jail sentences of seven years and fines of up to £1 million.
•For those in the hospitality industry, a new Bill will be introduced to ensure that tips are ‘distributed fairly’ to ‘those who work hard to earn them’. Companies working in relevant sectors will have to follow a statutory code to ensure tips are shared fairly.
Alongside these plans, there are a number of other changes we know will follow on from Brexit. Companies will need to ensure their contracts for trading with the EU are updated to take note of the new political reality, a new regime of customs checks will come into force and labelling and safety legislation will start to diverge from that covering the rest of Europe.
Of course, you’re not alone in facing these changes and we are on hand to help in any way we can. To get the best possible HR advice as we move forward, just click on the button for a free consultation.