With less than 3 weeks to go, the EU referendum campaign has seen a host of allegations about what Brexit would mean for employment law rights.
Although many areas of employment and discrimination law derive from EU law, we think it is unlikely that the Government would seek to make major changes in this area. EU employment rights such as family leave, discrimination protection, paid holiday and TUPE are well-established in UK workplaces and are priced into business outsourcing and acquisition agreements. Unpicking this framework would be highly unpopular with trade unions and employees and would cause considerable uncertainty for businesses. It is also likely that any trade deal would require the UK to comply with at least some EU laws, including EU employment law.
However, it is likely that, in the event of Brexit, the government would consider reforms in areas where EU legislation is perceived as business-unfriendly, such as:
TUPE:
It is likely that the overall TUPE framework would be maintained but that the government would legislate to make it easier to harmonise terms of employment after a TUPE transfer.
Agency Worker Regulations:
These are perceived as convoluted and as having a particular impact in the UK, where agency staff are used more frequently than in other member states. They may be repealed or substantially watered-down.
Working Time Directive:
The government may seek to introduce further carve-outs and may legislate to prevent voluntary overtime and commission payments being included in the calculation of holiday pay and to prevent holiday being accrued during sick leave spanning several holiday years.
Discrimination compensation:
The CBI has long argued for a cap on compensation for discrimination claims, but this is considered to breach EU law requirements.In the event of a Brexit, this might come back on the agenda in order to reduce the incentive for staff to make discrimination claims to avoid the statutory cap on unfair dismissal compensation.
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