How has UK employment law changed after Brexit?

Despite leaving the European Union officially on January 31, 2020, Britain still has many questions to ask about employment law. With the added impact of a pandemic, UK employment law has changed throughout 2021 – with some considerations for European labour law.

Essentially, European labour law Brexit changes will affect:

  • Immigration and rights to work
  • General workplace treatment
  • The interpretation of UK laws versus EU directives.

How “retained EU law” will affect UK employment law post-Brexit

Britain is now officially a “third country”, which means that, for some policies, it may be subject to its own laws as well as those of the European Union. Some employment law issues are set in stone, for example, changes to immigration law, whereas others still have the potential to change.

Creating a “level playing field”

One of the fundamental caveats of the United Kingdom’s exit from the European Union was to create a “level playing field”. Under the European Union (Withdrawal) Act 2018, both the UK and the EU now have the right to set their own policies around labour and social standards.

These rights may affect many areas of employment, from health and safety to working rights, information rights and restructuring. However, both parties must also adhere to a “level playing field”. Essentially, this means not changing a law to a significant competitive advantage – such as lowering the UK minimum wage.

European laws that will not change

Retained EU law also affects UK employment laws that were derived from the EU. Providing the law was in place before December 31, 2020, then it still applies. This affects up to 150,000 pieces of EU legislation, including:

  • The Whistleblowing Directive
  • The Transparent and Predictable Working Conditions Directive
  • The Work-Life Balance for Parents and Carers Directive.

Other EU-derived laws are fundamentally the same but have been amended slightly in line with the UK’s ‘third country’ status. For example, the General Data Protection Regulation (GDPR) was introduced in 2018, which means it applies. However, the Information Commissioner’s Office now refers to the law as the “UK GDPR”, while the UK will still follow the Data Protection Act 2018 guidance.

Likewise, the UK will now have to put in new safeguards for data transfer between the UK and the European Economic Area. This has the potential to be reversed later on. For other laws such as TUPE or the Human Rights Act, it’s unlikely that anything will change – though the UK has the right to do so.

Changes to UK employment law post-Brexit

As predicted, the biggest change we will see to UK employment law post-Brexit will be around working rights. Pre-Brexit, employers were obliged to check a candidate’s right to work in the UK. This will not change.

Instead, the former points-based system has been replaced with an immigration system that affects both EU and non-EU citizens. Those emigrating to the UK must follow the ‘Skilled Worker’ route, whereby they must have sponsorship from an approved employer.

They must also have a gross minimum salary of £25,600, an intermediate level of English, and skills equivalent to a UK A-level. Those already living in the UK had to apply for ‘settled status’ by June 30, 2021, to continue working here legally.

Again, it is up to the employer to check a candidate fits these criteria. The Home Office is allowing virtual document checks until April 2022. The settled status does not apply to Irish nationals, though it does apply to the EEA and the Swiss.

Potential changes to UK employment law to look out for after Brexit

There are some ‘grey areas’ affecting employment law after Brexit. For example, the UK could potentially revise holiday laws in line with the Working Time Regulations 1998. These dictate working patterns, such as number of breaktimes or hours’ rest between shifts.

The Working Time Directive 2003, which is derived from the EU, follows similar principles. But this has caused confusion post-Brexit, particularly with regard to holiday pay. In theory, the UK Government could now provide further guidance on overtime and annual leave – which could impact long-term sickness allowances.

While the directive and the regulations are similar, employers are striving for clarity now, and should be clear in their company handbooks.

Discrimination legislation

The Equality Act 2010 offers uncapped compensation for discrimination. While this derives from EU law, the Employment Rights Act 1996 caps compensation for unfair dismissal. As a result, the UK could now introduce a cap on compensation – for example, if somebody sought compensation after being dismissed for being pregnant.

Though it’s highly unlikely this will come into effect, as it may disproportionately affect minorities, it’s not impossible.

Labour inspections

While the Brexit agreement may call for a “level playing field”, there is one area where the UK does not quite match with the EU. Many EU countries have strict standards for modern working practices, underpinned by labour inspections.

At present, this is not the case for the UK. But this could change as the Government seeks to introduce a “single enforcement body” for employment rights. This will include consultations and reforms to current systems, looking at issues such as statutory sick pay.

Employers should also be looking ahead to August 2022 when the EU work-life balance directive comes into effect, helping to balance men and women’s rights around maternity.

Should I be thinking about European labour law in my company after Brexit?

Our exit from the European Union should not be an invitation to forget the fundamental rights of our staff. However, it will need constant review as more laws likely change in future. For more help navigating the differences between European and UK employment law, contact Altum HR today.

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