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Global HR Lawyers

Brexit priorities for HR with a year to go

21 March 2018

The United Kingdom will leave the European Union in just over a year’s time on 29 March 2019, in the absence of an agreement to defer the separation. It seems probable there will be a 21-month transitional period, during which EU laws will continue to apply and business will have time to adapt to a post-Brexit world.

At this juncture, unless the UK has a change of heart about leaving the EU, the most likely scenario is a “Canada-style” trade agreement – that is, one that is modelled on the EU-Canada Comprehensive Economic Trade Agreement (CETA). Possibly, this might include additional measures concerning financial services and some sort of fudge over reconciling the arrangement with the absence of border controls between Northern Ireland and the Republic.

Theresa May has set “red lines” against remaining in the Single Market and any customs union with the EU, and suggests a complex approach to regulatory divergence which seems both unworkable and unlikely to secure agreement with the EU.

The Labour leader Jeremy Corbyn, meanwhile, says the UK should enter into a customs union with the EU while retaining a say over any new EU trade agreements. It seems implausible that the EU would agree to grant the UK this, and equally implausible the UK would agree to be bound by new trade agreements over which it has no say.

The Liberal Democrats advocate a fresh referendum and continued EU membership. While this may yet turn out to be the ultimate outcome, it feels a very long way off at the present time.

The Scottish National Party advocates the “Norway” solution of remaining outside the EU but within the Single Market. As Norway is outside any customs union with the EU, however, this outcome would not deliver a border-free Ireland.

Although clarity about the way forward remains elusive, HR professionals need to continue to monitor the situation closely and assess the likely ramifications of Brexit on their workforces. The questions immediately arising include:

  • Do you have in place adequate means of tracking the twists and turns of negotiations and the potential impact of developments on your business?
  • Have you considered what support might be given to your EU migrant workforce and their families?
  • How will stricter controls on EU migration affect your business and do you have plans to hire or train local workers to fill any gaps?
  • Do you have British employees working in Europe who might be affected by Brexit?
  • Do you have the skills in your organisation to meet new requirements that are likely to arise after Brexit? For example, will you need HR staff skilled in dealing with an increased number of staff subject to immigration controls? Do you have people who will have capacity to manage new customs rules that will probably apply in trading with the EU?
  • Are there any specific implications of Brexit for your business? For instance, do you have a UK-based European Works Council and, if so, do you have plans to change its location post-Brexit?

While it is difficult to answer many of these questions given the current state of uncertainty, it is important for them to stay high on the HR agenda nonetheless.

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