BREXIT – Where Are We Now?

With 4 months to go until Brexit how will the UK leaving Europe affect your business? what should you be planning for?

The legal framework of laws and regulations under which a British company employs people will remain unchanged as upon leaving the EU, the UK will move into a transitional period where the rules will remain the same. This period will end on 31st DECEMBER 2020 currently.

However, what practically should businesses be thinking about?

  1. Have you identified which of your staff are EU nationals? And have they acquired the right to remain in the UK and have they exercised this right?
  2. Are they in key roles or if they decide to leave the UK will this affect your ability to run your business in terms of numbers?
  3. What have you done or what will you need to do to meet a skills or numbers deficit in your business?
  4. What if there is no Brexit agreement and we leave the EU in a “disorderly fashion” which may interrupt manufacturing and services. What contingencies do you have in place?

With regard to point 4, while all parties say this is unlikely there are a few things that employers can be looking at should their businesses be interrupted by a “disorderly” leaving of the EU.

  1. Do you have a reserve of raw materials, parts or other essentials of the manufacturing process?
  2. Has your business planned for the contingency of an interruption to normal service or supply?
  3. Have you the flexibility with regard to your staff to work shorter hours or to lay people off? Lay-off does not mean make people redundant on this context.

With regard to point 3 an employer may seek to use lay-off and short-time working as a way of coping with a sudden downturn in business, or unexpected interruption to production. They can provide significant temporary reductions in costs, whilst keeping the workforce intact and hopefully avoiding redundancies and its cost implications.

Short-time working involves a temporary reduction in the working hours of employees with a corresponding reduction in pay. Upon a return to normal conditions, then hours and pay return to normal.

Lay-off involves the employer not providing any work or pay to the employees for a period of time but the employer retains the employees during this period.

These may sound tempting to an employer who might be looking at a temporary interruption in business but there are some catches or limitations on their use. These provisions cannot be used unilaterally, they must either be agreed with the staff affected or an employer must show that there is a right for them to utilise them by way of the employee’s contract or the employee handbook.

For a general overview click on the following link – https://www.gov.uk/lay-offs-short-timeworking

As you can see, this is a tricky area and advice should always be taken from your HR practitioner before proceeding.  Have you checked the employee handbook and your staffs’ terms and conditions?

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