When the UK transitions fully out of the EU and new regulations come into force in January 2021, some things will change for UK businesses when it comes to hiring people. Though it’s still too early to know how every firm will be affected, you should familiarise yourself with the changes in legislation to understand how they may impact you.
Note: Information around the Brexit transition is still continuously changing, and so this blog shouldn’t substitute for official government or legal advice. Keep up to date with government guidelines here.
The end of the transition period
The transition period ends at 11pm on 31 December 2020, unless it is extended. Before the end of this period, there is no immediate change to employment law based on EU legislation, immigration, GDPR or right to work checks.
Hiring EU Nationals in the UK
Though EU nationals will be allowed to stay post-Brexit, they will need to apply to the EU Settlement Scheme in order to remain living and working in the UK. If you’re hiring EU staff who are currently living in the UK when the new immigration system comes into force in 2021, you’ll want to ensure this is incorporated into your right to work checks. The specifics around this new immigration system and required checks aren’t yet clear, and may be influenced by whether the UK secures a deal with the EU or not, so your legal and HR teams should keep abreast of developments as they arise.
The government plans to install a points-based immigration policy, alongside minimum salary thresholds, so you may want to research and understand if these new rules will impact your hiring. This system will not apply to those already living in the UK.
Many businesses put their Brexit preparations on hold in order to tackle the pandemic, and the impacts of this time are still being felt both economically, in the recession, and in the job market – resulting in a very high rate of unemployment. In July 2020, hiring and investment confidence returned to positive territory for the first time since lockdown. It’s still too soon to tell how Brexit will impact this trend, but Neil Carberry, chief executive of the REC, said “It’s good to see employer confidence rising as the lockdown measures ease – at this stage we would expect things to be getting better month-by-month.”
Brexit and sector impact
Different sectors will be impacted in different ways by Brexit, but those most significantly impacted may see changes, positive or negative, in employment levels. Financial services, automotive, manufacturing and tourism are among the industries that trade heavily with the EU. The NHS also has a high proportion of EU workers, so may be impacted. Though no one can firmly predict the outlook for each industry, the government does offer specific sector-by-sector insights which may be useful to familiarise yourself with if you suspect your industry may be impacted.
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