Over the last 4 ½ years, thousands of newspaper columns have speculated on the eventual outcome of the UK’s decision to leave the EU. Now the moment has almost arrived, it is worth reviewing what this will mean for employment law, probably the most heavily EU-influenced area of law in UK legislation.
That said, there are significant elements of our employment legislation that go over and above what is required of us under EU law, the national minimum wage being one example. As such, we believe that it would be politically unacceptable for our current employment laws to diverge radically from the existing framework even if we do not end up with a trade deal on 1 January 2021. If a deal is achieved, it is to be expected that we will retain our current employment legal framework as a condition of any new trade relationship with the EU.
European Court of Justice decisions
Until 31 December 2020 the UK courts must continue to interpret EU-derived legislation in accordance with ECJ rulings but from 1 January 2021 the UK will no longer be bound by ECJ decisions. At present, the Supreme Court is the only court able to depart from ECJ decisions but from 1 January 2021, the EU Withdrawal Act extends this provision to the Court of Appeal but not, it should be noted, to the Employment Appeal Tribunal which will remain bound to retained EU law. Nonetheless, it is worth noting that if our courts consider future ECJ judgments to be persuasive (if not binding) they may well take them into account where relevant.
What might change?
While there are a handful of areas that have been consistently targeted for change, the majority of UK employment law will remain largely unchanged as, under the EU Withdrawal Act, all EU law will be absorbed into UK law with some minor amendments. The government has made a point of rebutting any suggestions that it will erode regulatory standards or workers’ rights in a ‘race to the bottom’ but only time will tell if that remains the case. However, for now, the following areas may be subject to change:
- Working Time Regulations: while the right to statutory holiday pay is well established, the more recent requirement, following the outcome of British Gas v Lock, to take overtime and commission payments into account when calculating holiday pay is likely to come under the spotlight for reform. There is also a possibility that the accrual, and taking over, of holiday while on sick leave will be re-considered.
- Cap on discrimination compensation: the removal of any cap on the amount someone can receive in a successful claim for discrimination is likely to be reviewed.
- TUPE: a major change would too disruptive, particularly for commercial outsourcing arrangements. However, small changes such as provisions to make it easier to harmonise employment terms following a TUPE transfer might be acceptable.
- Agency Workers Regulations: The requirement for agency workers to be treated as employees after 12 weeks is another unpopular law and ripe for reform
Steady as she goes…
Given the turbulent year we have had, and the likelihood of further economic upheaval next year which will inevitably impact large sections of the workforce, it is very unlikely that there will be any major changes to primary or secondary employment legislation in the foreseeable future. In reality only a handful of unpopular laws may be scrapped (the Agency Workers Regulations being perhaps the most likely example) while others may be modified (discrimination compensation). Domestic laws and policies such as parental leave and flexible working are now so enshrined in UK legislation that it is unthinkable that a modern UK government, hoping for re-election, would even consider repealing a fraction of them.
