With events in Parliament approaching a climax this week it is almost impossible to say with confidence at this stage where the UK will be come 31^st October. Nevertheless many in the UK workforce and business community will be understandably extremely concerned about the very significant possibility of crashing out of the EU with no deal in just a few weeks' time. With that in mind the IPA have put together a special Brexit preparedness bulletin below with information and guidance news relating to Brexit, the workforce and EU employment rights.

Employee engagement is a key pillar of organisational resilience and it is resilience that is essential if businesses and other employers are going to weather the storm that may now be only a few weeks away. With this in mind we strongly urge all employers, large and small, to not neglect the voice of their workforce during their contingency planning for a no deal Brexit. Below we present a set of practical advice about specific contingency planning information as well as some general guidance about engaging with the workforce over Brexit and speculation about the future of employment rights after Brexit.

If you are an employer, trade unionist or HR practitioner and have questions or concerns about any of these issues, please get in touch and IPA would be happy to provide what support and assistance we can.

 

Government launches new No Deal Brexit preparedness support tool for businesses

The government has this week launched a new online tool to help businesses and individuals preparing for a potential no-deal Brexit. The tool can be found at www.gov.uk/get-ready-brexit-check and includes a short questionnaire followed by links to a range of articles about possible steps your organisation may need to take in anticipation of a potential no-deal Brexit outcome.

These include guidance on registering for an EORI number so that your business can still move goods into or out of the EU, advice on how to check new import tariff schedules as and when they are updated, and a range of other issues around accounting and reporting, appointing a representative to sell manufactured goods in the EU, and changes to intellectual property rights after Brexit.

You may need licenses or visas for your workforce to provide services in other EU countries after a no deal Brexit and if your workers travel to the EU they may also require International Driving Permits and travel insurance to replace their EHIC cards that may no longer be valid.

If you receive any personal data from the EU you may also need to review your processes.

 

Engaging with your workforce ahead of a no-deal Brexit

Uncertainty is the dominant characteristic of the present situation and even many of the webpages linked to through the government's Get Ready for Brexit tool are unable to say whether steps will definitely need to be taken, or merely 'may' need taking at some point soon. It is understandable that many employers are waiting until they think they may have more clarity before committing themselves to irreversible decisions.

Yet to avoid talking to your workforce about your contingency planning and how no deal might affect your business simply because you don't have all the answers would be a grave mistake, likely to breed distrust, rumourmongering and a collapse in employee engagement at this critical time when engagement is needed more than ever. If employees don't properly understand what plans are being considered and how decisions are being made, they are likely to assume leaders are hiding things or engaged in knee-jerk decision making. Instead leaders should display confidence and strength through transparency and being willing to admit if they don't yet have all the answers. Employees want to know that their organisations have a Plan A, Plan B and event Plan C in place, even if those plans might depend on assumptions that could change over the coming weeks.

Leaders also shouldn't shy away from saying difficult things – employees don't want or expect false reassurances where none can honestly be given and would much rather their leaders "tell it like it is". Where employees know the truth they can both prepare themselves mentally for the worst and also contribute constructively through employee voice to help provide solutions.

Leaders should ensure that any communications gap around Brexit is quickly plugged before we draw close to the 31^st October deadline. Senior leaders should be meeting regularly at this stage with staff forums and/or trade union representatives to discuss the latest updates and ensure factual information is being filtered through to all employees. Frequently asked questions about Brexit and their answers should be displayed prominently to all employees and regularly updated.

 

Providing advice and support to EU nationals in your workforce

Some of your employees will be affected more than others by a possible no-deal Brexit and this is true of nobody more than any citizens of other EU countries currently in your workforce. It's possible you might not even know for certain how many EU citizens you have in your workforce as they currently have the same right to work status as UK citizens. Some larger employers have taken steps over the last two years to compile a registry of EU citizens in their workforce, so that they are better placed to provide them support and advice relating to Brexit. You might also wish to do this in your organisation, but if so then take care to make it clear that this information is being gathered purely to support the workers, not to monitor or threaten them with potential loss of rights or status after Brexit, as in the present climate it is understandable that many EU citizens in the UK are fearful for their future.

Note that all employers have a legal duty not to discriminate against EU citizens in light of the UK's decision to leave the EU, both as a prospective and current employer. Placing additional burdens on current or prospective employees who are EU citizens, even after a no-deal Brexit, would constitute discrimination. Make sure that your HR policies and practices including recruitment and onboarding are compliant with Right to Work duties and don't discriminate on the basis of nationality, as well as making sure relevant staff are properly trained in these areas.

If you do know you have EU nationals in your workforce, you should check if they need to apply to the EU Settlement Scheme in order to continue living and working in the EU after Brexit. Officially registration will not need to be completed until 30 June 2021, though in practice it is strongly encouraged to begin the process before 31 October as lacking settled or pre-settled status by that date may complicate their travel plans if they travel to and from the UK over the next couple of years in the case of a no-deal outcome.

While securing pre-settled status still entitles your employees to continue living and working in the UK after Brexit while they wait for full settled status, it is a less desirable status than full settled status as it places limits on leaving the UK during that period and doesn't automatically grant British citizenship to any new children they have. There have been numerous recent reports of applicants who ought to be entitled to full settled status being denied this in favour of pre-settled status – this is an anxiety some of your staff may have that you should be aware of. Note that some EU citizens in your workforce may similarly want help to apply for permanent residence in the UK or naturalisation as British citizens if they have been here long enough.

While there is no legal obligation for employers to provide support to their EU workers with completing these applications, it would be a very good idea to do so. Ensuring they have access to workplace documentation that proves continuity of employment, residence and NI contributions in the UK might all assist EU citizens in your workforce with their applications. Showing that their employer is caring and supportive towards their situation, as well as more broadly demonstrating through words and deeds that they are valued members of staff and that their employer has their backs is much more likely to provide reassurance and help reduce potential staff attrition.

 

New rulings clarify law on European Works Councils

Recent rulings by the Central Arbitration Committee and Employment Appeals Tribunal in the Oracle case have clarified a significant proportion of the law around European Works Councils. The laws in question are the ECW Directive and TICER – The Transnational Information and Consultation of Employees Regulations 1999, as amended, the regulation which transposes the Directive into UK law. The Directive applies to all companies with more than 1,000 employees of whom at least 150 are in each of two different EU/EEA countries.

In particular the rulings relate to the Subsidiary Requirements, the fallback provisions that apply in cases where parties have failed to reach a negotiated agreement. There has up to now been a degree of ambiguity on what obligations these Subsidiary Requirements placed on management. The Oracle case has clarified several aspects of this case law, particularly relating to meetings of the EWC in 'exceptional circumstances':

• Management should wait for the EWC to request an exceptional meeting rather than "instigating" one themselves.
• Management should provide "sufficient information" to the EWC once a meeting is requested, in order to allow the EWC members to meet privately before the consultation meeting, without management present, in order to prepare themselves and obtain expert assistance if required.
• Meetings with the EWC should generally be held "face-to-face" unless the format has been agreed beforehand to be otherwise.
• Management are not legally obliged to wait for an employee response to the information and consultation meeting before they proceed with implementing their decisions. Legally the consultation ends with the close of the information and consultation meeting, though it would be sensible for management to allow representatives and opportunity to meet privately after the consultation meeting to formulate a response and then put it forwards before considering the consultation 'closed'.
• Management are still legally obliged to provide a reasoned response to any EWC opinion or response provided to it, even if they've already begun to implement their decisions.

Despite the fact that the UK will fall outside the scope of EU law in the case of a no-deal Brexit, judgements of UK courts such as the EAT on this subject will likely still be persuasive in other EU jurisdictions after Brexit, particularly in Ireland where many UK firms are relocating their EWCs.

 

Impact of No-Deal Brexit on UK workers' rights

Companies with European Works Councils will likely need to relocate these outside of the UK in the case of a no-deal Brexit as the UK will fall outside the scope of EU law. The UK government is encouraging companies to continue to allow UK workers to be represented on EWCs on a voluntary basis. UK employees will no longer be able to legally allowed to request for their employer to set up an EWC after Brexit but pending requests at the time of Brexit will still be allowed to complete. Note that Brexit will not affect the separate Information and Consultation of Employees Regulations (2004) which requires employers to set up information and consultation arrangements in the UK if requested by 10% of the workforce, dropping to 2% from 2020.

The other major rights that will be immediately affected by a no-deal Brexit related to employer insolvency. The rights of UK and EU employees working in the UK will not change if their employer becomes insolvent. However, UK citizens working in an EU country for a UK employer may lose their rights to compensation from the national guarantee fund in their country. Employees should check their rights with the embassy or consulate in the country in which they are working.

Beyond this there should be no immediate changes to workplace rights after Brexit, though the longer term future of many employment rights in the UK remain uncertain. At the point of departure, the European Union (Withdrawal) Act 2018 will transpose all previous EU regulations, including on employment rights, directly into UK domestic law. However, their enforcement would fall solely to UK courts and tribunals, with no further right of appeal to the ECJ. While in practice there doesn’t seem any reason to think existing rights would not be enforced any longer, we could certainly imagine a potential drop in compliance following the reduction in enforcement infrastructure and lack of EU-level pressure to enforce compliance. More troublingly, there would be nothing to prevent the UK government from acting to repeal or amend significant parts of the Social Europe regulations.

Theresa May repeatedly pledged over recent years that no employment rights would be repealed or watered down while she remained Prime Minister and that the UK Parliament would get an automatic vote on whether to match any strengthening of employment rights passed in the EU. Boris Johnson's promises on the same subject have been somewhat less watertight, however, merely pledging to "maintain this record of leadership [on workers' rights] after we leave the EU, with or without a deal" and "where necessary, to enhance workers' rights in this country." In particular, the commitment to get an automatic vote on shadowing future enhancements to rights in the EU appears to have been dropped – the Prime Ministers' new chief negotiator David Frost has been particularly critical of it, objecting to "the EU's drift towards heavy labour market regulation."

Beyond this it is hard to say how safe existing regulations really would be if the present government continues long in office or secures a majority at a forthcoming election. Regulations such as TUPE, working time protections, health and safety and collective voice via the ICE Regulations have long been derided by those on the libertarian right, led by the vision of a buccaneering Britain unshackled from the ‘red tape’ of regulation as outlined by the five authors of the 2012 “Britannia Unchained” book. All five of those authors are now senior figures in the government of Boris Johnson, including Home Secretary Priti Patel, Foreign Secretary Dominic Raab, International Trade Secretary Liz Truss and Business Minister attending cabinet Kwasi Kwarteng. Despite the fact that there is little appetite among the UK business community to see swathes of employment regulation ripped up, there should nevertheless be little complacency about the security of these rights over the coming years.