Now that the country has voted to leave the European Union, one of the burning questions in the workplace is, what will happen to the significant body of employment law that derives from Brussels? Over the past decades, EU directives have affected workers’ rights across the economy. For individual rights, employment protection legislation ranges from working time and annual holidays, rights for women and family-friendly policies, to anti-discrimination legislation and ‘atypical’ workers. Collective rights can be grouped under the core areas of collective redundancies and Transfer of Undertakings (Protection of Employment) Regulations [TUPE], European Works Councils, and information and consultation.
HR professionals are wondering how the workplace will be affected when Article 50 is triggered and the UK Government embarks on negotiations to structure a new relationship with the EU. Following the ‘leave’ vote, in theory the field could be open for a government to amend employment law if it could gain parliamentary approval. However, in reality the legal framework under which EU-derived employment law is transposed into UK law is complex and will not be straightforward to dismantle, even if there is the political will to do so. Also, nothing will change in the short-term.
A complex picture
Typically, European law is initiated in Brussels through directives and, once agreed, transposed into national legislation across all of the Member States. EU-derived law has been incorporated into UK law using a range of legal approaches including secondary legislation under the European Communities Act 1972, such as TUPE, as well as through standalone acts of Parliament, such as the Equality Act 2010.
The Working Time Directive is one of the most high-profile elements of EU-derived law affecting employment – before it was transposed into UK law, UK workers did not have a statutory right to paid annual holiday. The Directive ensured that all workers should be entitled to at least 20 days’ paid annual holiday, but the UK Government increased this entitlement to 28 days, including bank holidays. This is a perfect example of how the UK Government has chosen to ‘gold-plate’ some aspects of EU law, providing more generous provision for UK workers.
Further, one of the other main provisions of the Working Time Directive – that a worker’s working week would be limited to 48 hours – is already subject to an opt out in the UK. This Directive alone illustrates the complexity of how the UK transposes different aspects of EU law and how the wider domestic context influences its interpretation. For instance, successive governments have promoted family-friendly provision in workplaces and it’s hard to imagine a policy shift that aims to undermine this direction of travel in relation to EU-derived regulation.
A leap into the unknown
Any analysis of what the future holds for EU-derived employment law is based on speculation, and reliable commentary will have to wait until we see what appears on the negotiating table. Ultimately, any changes to workplace rights will depend on the shape of the political and economic relationship that the UK negotiates with the EU. However, trade agreements that would allow the UK continued access to the single market or joining the European Economic Area, like Norway, could require the UK to still accept the majority of EU regulations. Further, there will be legal and practical challenges associated with any attempt to unravel EU-derived requirements from non-EU-derived requirements, especially where case law has drawn on domestic courts’ interpretation of EU Directives and on European Court of Justice (ECJ) rulings.
Perhaps less will change than imagined
Analysis by legal experts before the ‘Brexit’ vote concludes that very little would change: EU-derived law is so embedded in UK law that it would be very complex to unpick, and would typically require new legislation. As already emphasised, what happens to UK employment law ‘will depend upon how the Government tries to extricate itself from the EU’, says the article: ‘If the Government simply repealed the European Communities Act, those regulations passed under it like TUPE would probably fall away, while freestanding acts of Parliament, such as the Equality Act, would remain in force. ‘A more realistic approach following an exit from the EU would be to maintain the status quo and start addressing particular laws individually over time; this could be by repealing them or merely tinkering.
There is also the important question of case law, and what would happen to precedents already set by the Court of Justice of the European Union (CJEU) and European Court of Justice (ECJ).
‘On leaving the EU, the ECJ would no longer have jurisdiction and its future decisions would not be binding on UK courts. It seems likely, however, that if we retain any laws originating from the EU (which is probable) our courts would still take account of future ECJ judgments as persuasive, albeit not binding, when ruling on those laws. In that case, the ECJ would continue to exert an appreciable influence.’ CIPD
Overall, with the major caveat that what happens to EU law depends on the future negotiating agenda, there is more likely to be a tinkering with specific areas which have been less popular with UK employers, such as the Agency Workers Regulations, the cap on discrimination payments, collective redundancy consultations and aspects of the Working Time Directive. We should remember that, on the whole, employers are not opposed to most aspects of EU legislation – when we surveyed CIPD members 10 years ago, the main areas that proved less popular were those relating to agency workers and working time.
CIPD June 2016