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What does Brexit mean for your European workers?

07 July 2016

The UK’s referendum vote on 23 June to leave the European Union (EU) has placed in doubt the future status of circa 3 million citizens of other EU countries living in the UK, approximately 7 per cent of the working population. Many businesses, particularly in the agricultural, care and hospitality sectors, rely on these workers, and are now wondering what the decision means for them.

It is possible that the UK government may reach a deal with other European countries which preserves the free movement of workers, in the same way that Switzerland, Liechtenstein, Norway and Iceland have done. However, the ‘Leave’ camp’s emphasis in the referendum campaign on curbing immigration makes it politically unlikely that complete freedom of movement will be retained. The UK government is most likely to seek some form of compromise position, although the extent to which this will allow continued access to the single market remains to be seen.

The immediate burning issue is what will happen with those EEA workers who are already living and working legally in the UK. The government has confirmed that there will be no immediate change to their status. However, Theresa May, who at the time of writing is the front runner to succeed David Cameron as Prime Minister, has said that although she wishes to ‘guarantee the position’ for EEA citizens already living in the UK, and British citizens already living in EEA countries, their status would nonetheless be a factor in Brexit negotiations.

It seems obvious that the UK government would be looking for symmetry of treatment of its citizens and EU citizens in any bilateral agreements which are reached. However, other candidates for leadership of the Conservative party, and therefore also to be Prime Minister, have expressed the view that EEA nationals living and working in the UK should not be used as bargaining chips. This tends to suggest that their rights to remain would be preserved, even if those of UK citizens living and working in Europe were not. Much will, therefore, depend on who is ultimately leading the country in the Brexit negotiations.

Nothing is likely to happen about this immediately. However, those who employ significant numbers of EEA citizens would be wise to engage in early workforce planning, in order to assess the impact on their business and recruitment plans, should it be necessary to replace those workers when the UK eventually leaves the EU.

There has been talk during the referendum campaign of the UK introducing an Australian ‘points-based system’ for immigration. The UK’s immigration system for workers coming from outside the EEA is already based on this model, and allows skilled workers (ie. those carrying out degree-level jobs) to enter the country if they have a job with a registered sponsoring employer, which meets certain requirements concerning job descriptions and salary levels. If freedom of movement for EEA workers ultimately gives way to a system of this nature, then employers may need to consider whether any future recruits from Europe could meet the requirements of the points-based system. If the system is also to apply to those European workers already living and working in the UK, then those workers would also have to apply under this system for permission to remain, or else leave the country.

Either way, in such a scenario, businesses wanting to employ European nationals would have to be registered as sponsoring employers. The immigration authorities are likely to see a rush of applications for sponsorship as ‘Brexit’ approaches.

It is worth noting that many of the European workers currently employed in the UK would not meet the required skill level under the current points-based system; something which makes the question of their future status all the more pressing.

Some EU nationals may therefore want to pursue settlement or naturalisation rights in the UK (assuming they meet the criteria) in order to ensure that they can continue to live and work here.

This whole area is clearly one of the many issues which will hopefully become clearer as time passes. We will endeavour to keep you up-to-date with any significant developments. In the meantime, if you require assistance with applying for a licence as a sponsoring employer, please do not hesitate to contact us.

Matthew heads our employment team. He handles the full range of contentious and non-contentious employment law issues for clients which include multi-national companies, owner-managed businesses and not-for-profit organisations. He is recommended by independent legal directory Chambers and Partners in which he has been described by a client as “responsive, commercial, understand where employers are coming from and get right to the point, with meaningful and practical advice.”

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Disclaimer: All legal information is correct at the time of publication but please be aware that laws may change over time. This article contains general legal information but should not be relied upon as legal advice. Please seek professional legal advice about your specific situation - contact us; we’d be delighted to help.
Matthew Clayton MA LLM (Cantab), CIPP/E
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