Cornwall Manufacturing Group

Communications with staff

The most immediate challenge in relation to staff appears to be a need to try and reassure them that any significant changes in employment rights and the right to work in the UK are unlikely to happen in the short to medium term. Any communications with employees should therefore be along the lines that there will be no imminent changes and that staff will be kept informed about any potential changes as the implications of Brexit on the business become clearer.

Staff wellbeing

Inevitably, the current situation, as with any significant period of change, can create a level of uncertainty, stress and anxiety and it will be important to be mindful and supportive of employees struggling to cope with any associated stress. Clear messages from the business on developments and reassurance that employees will be kept up to date can assist with this.

One thing that also appears to be coming through is examples of significant tension and or vocal arguments between employees in the 'leave camp' and employees who were/are 'pro-remain'. In addition there appears to have been something of a spike in incidents or racial harassment (often directed against eastern European migrant workers and/or Muslim employees). It would be extremely sensible therefore for all organisations to remind employees of their equality/diversity policies and core values, and make it clear that behaviour of this type simply won't be tolerated.

Recruitment and pay freezes

We are aware that some businesses have implemented recruitment and pay freezes at least for now, although this might turn out to be a short term protective step. It is possible that some skills swaps are needed in order to face changing market. We don't know whether there will be a skills or resource exodus. There is no sign of non-UK citizens leaving the UK in any number at this stage, as far as we are aware, but it is possible that some skills or resource gaps could open up over time so employers may need to start thinking about strategies to address that. It's worth noting however that some employers have already been making it clear in any communications that they welcome talent from around the world. In fact, the NHS started a twitter hashtag #LoveOurEUstaff.

Business immigration

Inevitably a Brexit has been causing significant uncertainty for EEA workers. However, until the negotiations commence to leave the UK, there is no immediate change in the status of EEA staff (or their non EEA family dependants for that matter) who are currently living and working in the UK and some reassurance can be given to staff on this basis.

However, once such reassurance for the short-term is given, steps that businesses should consider taking now are to:

  • Identify workers who rely on EEA free movement rights so they are immediately aware of whose immigration status will be affected as and when announcements and changes take effect over the next few years
  • Encourage those exercising free movement rights to obtain whatever official documentation they can from the UK authorities regarding their residence rights in the UK as soon as possible
  • Encourage eligible EEA employees who have been in the UK for five years to apply for permanent residence. This is because such rights may be given priority when mechanisms are devised to differentiate between those who can automatically stay and those who need permission to remain
  • Separately businesses may want to consider applying for a tier 2 sponsor license if they don’t already have one

Looking ahead, the current indication is that the Government may look for a points-based visa system. However, it is likely that the free movement of workers will be a condition of negotiating a trade deal with the EU. Whether this will be the case remains to be seen and this area will be the subject of much focus during future negotiations.

Legal changes

There is a significant body of employment law in the UK that derives from the EU. In theory, Parliament could claw back on these rights. However, the legal framework is complicated and EU and UK employment law is intertwined so it may not be straightforward to unravel this in the short term. It also depends on the political will at the time and the relationship negotiated with the EU as part of any trade deal. Trade agreements such as the European Free Trade Area (EFTA) or joining the European Economic Area could require the UK to still accept the majority of employment regulations from the EU.

Although we don't know what legal changes there will be, we do know that there won't be any changes for some time yet. For more information on the EU employment rights that may be affected in the future we've done an article that can be accessed here.

Pensions

An estimated £90 billion was added to deficits overnight as a result of Brexit but often pension schemes are invested for the long term so the key advice from investment advisers is to not do anything knee jerk.

For further assistance please contact James Collings, partner on (0)1872 243307 or email james.collings@footanstey.com

Tags: Employment and Pensions2016