With the upcoming referendum now less than a month away (taking place on 23 June 2016), what are the potential implications for UK Employment Law of an exit from the EU and how much of the media coverage is fact or fiction?
It is fair to say that there has been a degree of scaremongering in the press about the potential for erosion of employees’ rights if Brexit were to happen. Many employers won’t know that the UK does actually protect a number of fundamental employment rights which are not necessarily derived from Europe. For example, workers in the UK already receive a national minimum (or living) wage, more annual leave entitlement than the EU requires and had implemented maternity and equal pay rights long before the EU required us to do so. Some of the most well-known employment rights, such as the right to claim unfair dismissal, are not linked to Europe in any way, so it is probably reasonable to assume that these fundamental legal principles won’t be going anywhere.
But what about recent ECJ case decisions that have impacted us? Employers will undoubtedly be aware that these legal decisions have a significant effect. In recent years, the most notable cases have granted employees the right to accrue annual leave whilst on sick leave and have determined that employees should be paid additional holiday pay to reflect overtime worked and commission paid. If Brexit were to happen, it is true to say that the government would have the power to put us back in the position we were in before the EU intervened with our domestic laws, as they would effectively be given authority to legislate out any laws that they did not like, but we simply don’t know whether this would happen in practice.
Critics would say that if Brexit did happen, it would probably be safe to assume that if any legislation were to go, it would be the legislation that the government has expressed its displeasure with in recent years, including the Human Rights Act, the Agency Worker Regulations and some of the core principles of the Working Time Regulations. There would also need to be some transitional provisions in place to deal with migrant EU workers who now reside in the UK and we can only speculate at present about how that will be addressed.
Notwithstanding the above, even if the government did have the theoretical power to repeal current UK legislation, I would suggest that the removal of rights such as those conferred by the Equality Act 2010 would not be an attractive option to any government due to the severe negative impact on employee relations and trade union harmony. The risk of an unbearable torrent of Employment Law changes upon Brexit remains, therefore, relatively low.
However, there is a significant issue regarding certainty for business. As long as many employment rights are underpinned by European directives then a change in Government at a UK General Election does not usually mean wholesale changes in employment law. Without these directives any Government elected in the UK would in theory be able to repeal large sections of the Working Time Regulations or the Data Protection Act 1998, only for the next Government, in five years time, to reinstate them again.
As a final point, even if the Vote Leave campaign were to succeed, we wouldn’t be entirely free of European impact as the UK remains a member of the Council of Europe. Therefore, the European Court of Human Rights (not to be confused with the European Court of Justice) will continue to influence the UK. This covers enshrined rights such as the right to a fair trial, which extends to employees facing the possibility of being deprived of their right to practice their chosen careers as a result of a disciplinary situation.
Whilst this will all be academic if we vote to remain, the UK is required to give two years’ notice of its intention to leave the EU so even if Brexit does happen, we won’t be gravely impacted just yet.
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