3 Brexit Basics for Employers

We’ve heard less about Brexit this year but, in spite of Covid and other challenges that have dominated the headlines, it’s going ahead.

As the transition period ends on 31 December 2020, is your business ready? We look at 3 key areas for employers ahead of B-Day:

1. Employment Laws
2. Freedom to Work
3. Data Protection

From 1 January 2021, the UK is no longer an EU member state. At the time of writing it appears that we are heading towards securing a deal.

1. Employment Law

Q. What might Brexit mean for employers? Will there be a new holiday regime? A new TUPE regime?

A. No. For now, thankfully, given the upheaval employers have faced this year, the laws governing the employment relationship broadly speaking should not change in January 2021.

Although a lot of the laws in the UK were derived from the EU originally, they are now enshrined in UK law. Employers are used to them, employees are used to them. We know where we stand (…well mostly!).

The UK will retain all the major employment laws for the short term at least. So the regulations dealing with transfers of businesses and their employees as well as changes in service providers (TUPE), the Working Time Regulations, family-friendly rights, and discrimination laws will remain the same for now.

2. The Right to Work in the UK (pre and post-Brexit)

Q. Can EU citizens continue working in the UK as before?

A. Although freedom of movement officially ends at 11pm on 31 December 2020, potentially yes.

If the worker isn’t sponsored by your business, the first question is, “Is the worker physically in the UK on 31 December 2020 and how long have they been in the UK?”

• 5 years’ residency

  EU citizens who have resided in the UK lawfully for 5 years before 31 December 2020 can apply for settled status to stay in the UK indefinitely under the EU Settlement Scheme (even if they have permanent residence documents). Continuous residency means at least 6 months in any 12 month period, for 5 years in a row. These individuals do not require permission to work in the UK. They can:
  – Live in the UK
  – Access public funds and services and
  – Apply for British Citizenship
  
  

• Less than 5 years’ residency

  Those who have less than 5 years’ residency in the UK by the 31 December 2020 can apply for pre-settled status until they get 5 years’ residency. They can then look to obtain settled status.

Note: they can continue to work while they wait for their application to be considered.

To ensure EU citizens have the right to work in the UK, up until 30 June 2021, the starting point is seeing their passport or national ID card.

Watch this space for a blog on what right to work checks you need to carry out on prospective employees (including EU citizens) before employment starts to avoid potential civil and criminal sanctions.

Q. When is the deadline for applications?

A. Applications for pre-settled and settled status need to be submitted by 30 June 2021.

Similar reciprocal rights are to be conferred on British Nationals residing in the EU before the end of the transition period.

Irish citizens do not need to apply for settled status in the UK.

Q. If an EU citizen does not have residency by 31 December 2020, can they work in the UK?

A. Potentially, yes. Without residency and either settled or pre-settled status, other routes are available for EU citizens in the same way that they are for non-EU citizens to work in the UK.

Up to 1 December 2020, migrants from outside the EEA and Switzerland could qualify to work, study or live in the UK under the tiered points-based system. Generally, individuals were sponsored by an employer before they applied to enter or remain in the UK. However there was and is an unsponsored immigration route available too for certain individuals. One such route is for innovators with a minimum of £50,000 to invest in a new business in the UK.

From 1 December 2020, the tiered immigration system has been replaced – initially just for migrants outside the EEA and Switzerland. Then from the 1 January 2021, once free movement ends, it will be available for citizens from inside the EEA and Switzerland too. Although the tier terminology has mostly being replaced, it is still a points-based system and many routes will stay in their existing format.

Sponsored immigration route

UK employers must obtain a sponsor licence before employing migrants. 

A sponsor licence will be much more important now for employing any migrants. It is valid for 4 years, costs up to just under £1500 and you can apply online on the Home Office website. (The standard process takes up to 8 weeks, and there are monitoring and reporting obligations for sponsors.)

A key route in to working in the UK for all migrants (EU and non-EU) under the points based immigration system will be the Skilled Worker route, replacing Tier 2. This is one of the sponsored routes. The Skilled Worker route is much more relaxed than its predecessor. Candidates must still meet a number of requirements including:

– the skills level requirement (with a minimum equivalent to A level) and

– the salary level for the role (a minimum of £25,600 or the going rate if more). 

Unsponsored business-related immigration

Alongside the innovator route, there are other unsponsored routes: Individuals might for example come into the UK as a standard visitor to undertake business activities for up to 6 months in any 12-month period (but not to live and work).

In short, once freedom of movement has gone, from 1 January 2021 EU and Non-EU citizens will be treated equally under the new points-based immigration system.

3. Data Protection

Q. How will Brexit impact data protection?

A. After 31 December 2020, the UK will be a “third country” under the GDPR. Transfer of data to and from the EU (including data related to employees) will then depend upon the terms of an adequacy decision by the EU to enable the continued free flow of personal data. This is to ensure the UK is doing enough to protect the data we might receive from the EU to be seen as a safe place to send data regarding EU citizens.

Q. What is the adequacy decision?

The adequacy decision hasn’t happened yet. The assessment is ongoing. At this point the same data protection regime is in place in both the EU and the UK, so the answer about the UK’s adequacy should be straightforward! (“Yes, the UK’s level of protection is adequate”)! However much of the Brexit negotiations have been far from straightforward.

Without an adequacy finding, “appropriate safeguards” are needed for the EU to permit data transfers between its countries and the UK. These safeguards might be:
• standard EU approved contractual clauses or
• other mechanisms.

Therefore the advice right now (which is subject to change) is to ensure you have the standard contractual clauses in place between you and your EU customer/supplier from 1st January 2021, these are standard, without any amendments needed, and can be found here (Standard Contractual Clauses (SCC) European Commission).

High standards of protection for data will remain key for the UK to ensure businesses can continue their operations without a hiccup regardless of any divergence in the specific approaches of the UK and EU to data protection after Brexit.

Further reading

• “Make sure you’re ready” Brexit transition guide from GOV.UK (www.gov.uk)
• A guide to the 2006 TUPE Regulations (as amended by the Collective Redundancies and Transfer of Undertakings (Protection of Employment) (Amendment) Regulations 2014) for employees, employers and representatives (publishing.service.gov.uk)
• Employer Information for UK Points-Based Immigration System – Helping employers understand the new points-based immigration system (campaign.gov.uk)