Please enable JavaScript to view this website.

A Look into the Possible Employment Law Implications of Brexit

The United Kingdom (“UK”) voted to leave the European Union (“EU”) on June 23, 2016 with a 52% to 48% vote in favor of leave.1 The outcome shocked most of the UK and the world. The vote will not have an immediate effect on UK employment laws, but the long-term effects depend on the relationship between the UK and the EU.2 It will be at least two years until the Brexit is complete. There are multiple options for UK-EU relations post-Brexit. The three most popular options are the Norwegian model, the negotiated bilateral agreements model, and the third country model.3

 

Under the Norwegian model the UK would join the European Economic Area, like Norway, and still have access to the internal market without tariff and trade restrictions.4 This model is the most popular with employers because it would continue to allow the free movement of persons as currently exists.5 If this model was agreed upon, there would most likely not be any changes to the current cross-border employment laws for UK citizens working in the EU and EU citizens working in the UK.

 

The negotiated bilateral agreement model would allow the UK to negotiate issue by issue with the EU.6 This is a time consuming process and some negotiations could be difficult. Pursuing this option “would likely require the UK to accept some of the EU’s rules on free movement of persons and comply with particular EU laws.”7 This model would also be less liberal than the Norwegian model and there would be more employment law obstacles depending on the negotiations made between the parties.8

 

In the third country model the UK would be totally separate from the EU and would be treated like any other non-EU member country.9 This model would have the most impact on employment laws because UK citizens working outside of the UK and non-citizens to work in the UK would face restrictions. UK citizens working outside the country may have to apply for a visa or “blue card” that would only be for a fixed time period, require the employees to state their intentions to return, and their level of income.10 Non-UK citizens may face even more restrictions if they want to work in the UK.11 This model would make cross-border employment very difficult for Europeans on both sides of the English Channel.

 

If a model other than the Norwegian model is chosen the “effect of Brexit would be to throw freedom of movement into doubt, potentially restrict employee mobility, and adversely impact the ability of UK businesses to hire employees from across Europe.”12 EU members rely on free movement among member states for a variety of reasons, but employment is one of the most economically important reasons for such policies. The full effects of employment restrictions on the EU and the UK cannot accurately be predicted at this time.

 

Only time will tell what model the UK decides to go with regarding its exit from the EU. Negotiations are set to start this fall.

 


  1. Brian Wheeler & Alex Hunt, Brexit: All you need to know about the UK leaving the EU, Bbc News (Sept. 1, 2016), http://www.bbc.com/news/uk-politics-32810887

  2. Matthew Howse & Pulina Whitaker, Labour and Employment Implications of ‘Brexit’, Morgan, Lewis & Bockius LLP (Feb. 26, 2016), https://www.morganlewis.com/pubs/labour-and-employment-implications-of-brexit. 

  3. What “Brexit” means for employers and employees, Eacc-New York, https://www.eaccny.com/news/member-news/what-brexit-means-for-employers-and-employees/ (last visited Sept. 19, 2016). 

  4. Legal Implications of Brexit, Davis Polk & Wardwell LLP (June 24, 2016), https://www.davispolk.com/publications/brexit-legal-implications/

  5. Id

  6. Id

  7. Id

  8. What “Brexit” means for employers and employees, Eacc-New York, https://www.eaccny.com/news/member-news/what-brexit-means-for-employers-and-employees/ (last visited Sept. 19, 2016). 

  9. Id

  10. Id

  11. Id

  12. Brian Wheeler & Alex Hunt, Brexit: All you need to know about the UK leaving the EU, Bbc News (Sept. 1, 2016), http://www.bbc.com/news/uk-politics-32810887