Brexit and its impact on your business – Thoughts from HPC


A week has passed since the outcome of the EU referendum was announced and as there is still no clearer understanding of what an EU exit will look like, understandably employers and employees are worried about the potential impacts that this change will have on their organisation.  I have considered the possibility of what the outcome of the vote means to the future of work and how best organisations can prepare for it.



Employees will be unsettled about the change and could be worried about job security and changes to their rights.  As an employer you should try and reassure your employees that any significant changes in the UK are unlikely to happen in the short to medium term.  If you intend to make any changes, then communication is key and you should ensure that managers are aware of what the organisation plans are, so that they can support their staff and keep people updated.  This is particularly important if your organisation is international and if there are any plans to relocate following the results.  Failure to engage in early and meaningful consultation will not only unsettle your employees but also put you at risk of ET claims as all employment law still remains in place.


Companies should provide managers with the tools to deal with managing change and encourage clear communication to all its employees.


Changes to employment law/workers’ rights

One of the concerns raised by the Remain campaign was a vote to leave the EU would mean the reduction of workers’ rights and whilst a significant body of employment law in the UK derives from the EU, in reality it may not be as simple as that.  In theory, the Government could change employment law but it would need support from Parliament and it will be a complex piece of work to dismantle the UK law from EU-derived employment law.    However, it is worth noting that a significant amount of employment law is embedded into employee’s contracts of employment.   To make significant changes to the contracts of employment would mean full scale consultation would have to take place.


Although it is difficult to predict what changes a government will make to employment laws as the UK manages its relationship with Europe, it is doubtful that it would result in a complete dismantlement of workers’ rights.  We are confident that there will be significant lobbying from relevant interested parties to resist the reduction of employment rights.  The CIPD, the body representing HR professionals, has already stated they will be making the case for maintaining the status quo on employment law.


However in the interim we would advise companies to review current policies, contracts of employments and other documentation to understand how employment law impacts on their current practices.


Changes to immigration

One of the key drivers of the EU referendum surrounded immigration; with the Vote Leave campaign pledging to end the automatic right of all EU citizens to come to live and work in the UK.  Companies may be fearful of the impact of any changes to immigration laws and regulations following the referendum outcome.  Many employers rely on the support of both skilled and unskilled workers from outside the UK to aide their business growth and success. The Vote Leave campaign advocated the benefits of an Australian points-based system and that any changes to the immigration system could mean difficulties in the recruitment of key position as well as cost implications.  However, it is unlikely that any major changes will be made to the immigration system in the short to medium-term in the UK, as some people are predicting it could take up to 2 years for the UK to leave the EU.


Companies that currently employ EEA nationals should reassure your existing EU workers that they don’t face risks to their job security as there is no significant threat to the rights of EEA workers already in the UK to live and work.  It is predicted that there will be some sort of worker registration scheme introduced in the future for EEA nationals that are already in the UK to protect their right to continue to live and work in the UK.  Whilst there is clearly uncertainty around what will happen with people from the EEA who enter the UK, it is an area the Government will tread cautiously as they will not want to have tit-for-tat measures put in place by other countries.


Shockingly, what has become come clear in the last week following the referendum is sadly a rise in hate crimes towards foreign nationals being reported both in the wider community and in the workplace.  Companies need to take a responsible approach to the fallout following the vote and this includes making it clear of the expected standards of behaviour including the use of ‘banter’, taking seriously any kind of allegations of harassment due to race/nationality, and clearly follow the organisation’s equality policy.


What is important in the interim is not to panic and to look forward to how you manage any changes that will in no doubt come.  HPC will continue to consult, research and inform our clients of changes as the picture becomes clearer.  In the meantime do not hesitate to contact HPC for support.


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