Brexit and UK Employers

We have all awoken today to the news of a vote to leave the European Union. The effect of the departure is likely to be of critical concern to employers in the UK.  Whilst it is very early days I would offer some initial thoughts on contingency planning when it comes to staff.

Traditionally, in contrast to non-EU workers, employers who choose to engage an EU national could be relatively relaxed in terms of their rights to reside and to be employed lawfully without much ado, since the Citizen’s Directive and accompanying domestic regulations create strong rights for EU workers to reside in the UK.

This will no doubt change, although this change may take some time. There are a variety of opinions on the likely approach of government to existing EU nationals residing here. Perhaps the most likely (and positive) is that there will be some form of transitional provision, or incorporation of existing rights under the Citizen’s Directive into UK domestic law. In this way, existing residents would have a degree of protection. However for every transitional provision there are likely to be cut off points and perhaps not every EU citizen resident here will benefit from these, if for example they have only resided relatively recently. 

Other blog postings from our firm today have talked about potentially seeking residence documents now, before changes are enacted, which at least will provide a degree of proof about status at a given point. Much of the existing Home Office case-working, whilst recognising that EU nationals are not formally required to obtain registration card or residence permits, will provide shortcuts in applications by not requiring further evidential proof, if previously issued documentation confirms status. It may be prudent to seek these documents now and have status confirmed. 

We have talked before about new British citizenship requirements, which require EU nationals to obtain permanent residence documentation before applying for citizenship.

It would however also seem certain that at some point in the future there will no longer be free movement provisions for EU nationals to come to the UK. That will require, presumably, applications under whatever amended system for ‘work permits’ will exist. In effect EU citizens wishing to come to the UK will be in the same bracket as non-EU citizens from around the world. 

The current system Tier 2 is very complex but has undergone substantial amendment and tweaking. It would seem a herculean task to start dismantling Tier 2, the list of skilled occupations and the salary codes, particularly since the Migration Advisory Committee completed a recent review on the system.

Therefore it may not be far off to imagine that to engage skilled EU workers sponsorship by an employer under Tier 2 will be required. Many employers will already have sponsor licences and will be familiar with the processes and obligations under the system. Whilst relatively onerous, having a sponsor licence and abiding by the regime imposed is essential to employ migrant workers. 

Sponsor licences are currently issued for a 4 year period. They can also be renewed after that period. Whilst it is very hard to predict, it would seem unlikely that any government would require the approximately 30,000 existing sponsors to re-register under a new scheme. The hope would be that the existing sponsor scheme would continue and simply be expanded to include EU nationals. With that in mind, it may be a prudent step for your business, if not already licensed, to seek a sponsor licence. This may provide some degree of contingency in the face of any future restriction on the ability to bring EU workers to the UK, and may avoid being caught in a scramble to seek a licence, once such an approach is announced. 

The big caveat is that it is almost impossible to predict how our immigration system will change, but it is certainly not a wasted exercise to consider contingency early, and to ensure that the impact of any changes can be minimised. Perhaps once the dust settles over the next few weeks there will be a clearer way forward.