The potential impact of Brexit on employment rights and fairness at work

The question of employment rights has been a recurring theme in the debate over the UK’s membership of the European Union (EU). The argument that European laws have imposed unreasonable and unnecessary burdens on business, and particularly on small and medium sized business, was a touchstone for those arguing in favour of Brexit. However, in the wake of the referendum vote, there have been growing calls for workers to be offered equivalent legal protection if and when the UK finally leaves the EU.

Concern over the potential unravelling of our existing framework of employment rights largely revolves around the importance of establishing ‘a floor of rights’ and setting minimum standards in ensuring a degree of workplace equity, protecting the most vulnerable and challenging the reliance of the UK economy on low paid and low skilled work. 

The stance taken by government has important implications for the ability of the UK economy to compete with its EU counterparts. More specifically it suggests that providing a robust framework of individual employment rights and also encouraging the development of collective forms of employee representation are central to increasing employee engagement and consequently productivity.

In simple terms, current employment rights for British workers can be categorised into three types. The first are purely national measures with no EU influence or intervention and upon which Brexit will have no direct effect, such as the National Minimum Wage and National Living Wage. The second were brought in as a result of EU directives, including equal treatment for agency workers, limits on working time and rights around information and consultation. The third, and perhaps most complex, are those where British law has been amended, extended and underpinned by EU measures.

What happens to these and other rights remains, of course, to be seen, and once the Brexit process is underway, simply unravelling the fabric of British employment law, deciding which strands to retain and which to repeal, will then take up substantial amounts of Parliamentary time. And much will depend on the stance taken by the Brexit negotiators.

If Britain seeks some form of continuing trade relationship with the EU, then it might be necessary to retain some, if not all, of the rights and protections required by the EU. However, there is a growing consensus that at least some employment rights will be weakened.

There are also strong indications as to the rights which are most at risk, with the Chartered Institute of Personnel and Development suggesting that the coming years will see “a tinkering with specific areas which have been less popular with UK employers”. Therefore it seems we are likely to see the erosion of rights related to: working time and paid holidays; agency workers; protection against some forms of discrimination; health and safety; and collective consultation on issues such as redundancy.

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Richard Saundry, Professor in Human Resources Management and Employment Relations, talks about the influence of the European Union on employment legislation and the potential impact of Brexit.

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But far from being a ‘burden’ to business, it could be argued that workplace fairness and equity underpin economic efficiency and productivity. Therefore, any attempt to use Brexit as a pretext for de-regulation may have negative consequences for the UK when it comes to competition with its former European partners.

However, in highlighting the importance of maintaining the UK’s current provision of employment rights, it is important not to exaggerate the extent of protection currently provided.

On its own the law cannot achieve anything – it has to be enforced – and most employment rights have to be enforced by the individual employee: there is, for instance, no agency proactively overseeing the right not to be dismissed unfairly.

It is not surprising, therefore, that the rights of many employees are breached, subverted or ignored. It is estimated, for example, that over 200,000 workers over the age of 21 are being paid less than the legal minimum wage. Similarly, a major study has found that despite being protected, more than one in 10 pregnant women and new mothers have ‘felt forced’ to leave their jobs, and that, despite it being unlawful to do so, one in four employers believed that it was ‘reasonable’ to ask women applying for a job about their plans to have children.

This problem of enforcement is made more acute by the erosion of structures of employee representation and voice. Declining union density and the shrinking of collective bargaining over the last 35 years has been well documented but, crucially, there is little evidence of alternative sources of employee voice filling this gap.

Two-thirds of workplaces have no representative structures and the majority of employees have no access to an on-site representative. This means not only are most workers in the UK reliant on the law to ensure fair treatment but when faced with a problem at work they are effectively on their own.

Effective workplace representation can not only help workers to enforce their rights but also resolve potential conflict and so minimise the need for legal adjudication.

It would be our recommendation that the Government should immediately commit to ensuring that an equivalent level of employment protection is maintained as part of, or immediately after Brexit, and it should establish a Fair Work Commission (with tripartite representation) charged with reviewing the impact of employment regulation and developing policy in relation to employment rights and labour standards.

It should explore new mechanisms of enforcement and adjudication to develop a more proactive system, which could include the development of a Fair Work Ombudsman, and should provide for company and workplace level structures of representation by building on existing Information and Consultation of Employees (ICE) Regulations. And statutory union recognition procedures, under the Employment Relations Act 1999, should also be simplified to ensure that where workers support collective bargaining unions are recognised.

Even if the government leaves the current framework of employment rights intact, this will do little to remedy the persistent problems of unfair treatment experienced by British workers and the negative consequences of this for employee engagement and productivity. If the UK is to compete with its former European partners post-Brexit, then it not only needs to ensure minimum labour standards but also needs to follow their lead in providing workers with channels of effective voice and representation in the workplace.

The iSPER Brexit Series

Since the British public voted to leave the European Union, there has been widespread conjecture as governments across Europe and beyond try to assess the political and social ramifications of the result. 

As such, policy makers face a number of challenges in light of the increased responsibility placed on them – as areas of legislation previously under EU competence will soon be decided nationally.

In a new project led by the Institute for Social, Policy and Enterprise Research (iSPER) leading academics across a range of fields will attempt to shed light on how the referendum result might affect their areas of expertise.

Find out more about The iSPER Brexit Series