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Brexit: What's the Impact?

Date: 15th July 2016

Brexit: What's the Impact?

The people’s voice has been heard on Brexit, Tory MPs at least have had their say on our future Prime Minister and Theresa May will be leading us into the uncertainties of a Brexit future.  After a night of the long silver spoons the new cabinet is emerging as we write, so against that background in this week’s newsletter we at RBHR move on from speculating about what the most far reaching change to society for many years might mean for employment law, to attempting to flesh out some of the more likely consequences of what has been a tumultuous few weeks in the history of the nation.


I didn’t have children… now I do! (Credit: Tanzes Anziger)

One of the few things we do know today is that no-one – not even the new Secretary of State for Brexit David Davis – has a fully (or even partly) formed Brexit plan.  The putative government has been remarkably silent and evasive on the subject and we get the impression that not only does no-one have a plan, but they don’t even know what should go into a plan either.  It looks like it will be a very long time indeed before article 50 is triggered, let alone the process being completed.  The people’s will has been clearly expressed but does the government apparatus have the capacity to fulfil it?

Enough speculation!  What about the players in this process?  What are their default positions on workplace regulation, and does that give us any clues as to where that is likely to take UK employment law?

What we can be certain of is that we won’t be getting is Andrea Leadsome’s future workplace where micro-businesses would be entirely free from employment regulation.  The RBHR team were a bit baffled by how this 2 tier employment policy would work anyway.  As our esteemed boss Becky said, what happens if you’re a microbusiness one day and a “macrobusiness” the next?  Overnight employers would suddenly have to (amongst other things) pay the minimum wage, provide maternity benefits and holidays – a high price to pay for a growing business.

So, let’s start at the top.  What is Theresa May’s attitude to the workplace?  May set herself apart during the leadership contest by actually sketching out a philosophy for her vision of the future workplace - and it’s not one that you might think of as being a typical Tory one.  For example, Mrs May attacked the “narrow social and professional circles” that dominate Britain’s boardrooms arguing that “the scrutiny they provide is just not good enough”.  She advocates employee representation as an adjunct to the usual boardroom presence (although not to replace it).  It certainly sets the scene for the introduction of some radical new policies during her tenure – at least for larger companies.

She gave us further clues as to her intentions in her first speech as Prime Minister when she said: “If you’re from an ordinary working class family, life is much harder than many people in Westminster realise.  You have a job, but you don’t always have job security … we will do everything we can to give you more control over your lives”.  We can only speculate, but job security is easily linked with unfair dismissal in the HR world – could this mean a cut in the qualifying period for taking a claim back to one year?  Or perhaps it means more action on zero hours’ contracts?  Time will tell.

In the same speech she noted that: If you’re a woman you will earn less than a man.”  Indications here that there may be a strengthening of the Equal Pay legislation in the offing.

Next, how about Justine Greening, the new Justice Secretary?  Her appointment is certainly welcome to a post that has been male dominated for hundreds of years.  2 things of note though…  in 2011 she thought that Employment Tribunals were still called Industrial Tribunals (they haven’t since 1998) – she will be in charge of the Court and Tribunal Service from hereon in!  In the same year she is quoted as saying in Parliament “This Government inherited the most expensive justice system per capita in the world … may I suggest that there are many areas where savings can be found without cutting front-line services?”  Draw from that what you will but it is almost a dead cert that there is going to be any significant change to the Tribunal system itself or the fees regime that supports it.

Finally, what about the man who will be leading the Brexit negotiations, David Davis?  Most tellingly, in a recent policy paper Mr Davis said: “All the empirical studies show that it is not employment regulation that stultifies economic growth, but all the other market-related regulations, many of them wholly unnecessary.  Britain has a relatively flexible workforce, and so long as the employment law environment stays reasonably stable it should not be a problem for business.”  That does not sound like the words of a man who has the dismantling of EU employment law as a priority.

What conclusions can we draw from the current state of this rapidly changing situation?  We are happy to report that our opinion hasn’t changed a great deal from the position we set out in our last newsletter.  Nothing is going to happen quickly and actually for once, employment law is not the villain of the red tape peace.  In short we predict an if it ain’t broke, don’t fix it approach, and if anything, a liberalisation of approach to workers’ rights.


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