21 Jul 2020

It is business as usual for now as nothing will change during the implementation period, which expires at 11pm on 31 December 2020. All EU-derived employment law and directly effective EU employment legislation continues to apply to the UK during the implementation period. The European Court of Justice (ECJ) continues to have jurisdiction in the UK and the UK courts are able to refer cases to the ECJ. At the end of the implementation period, a new body of retained EU law will be created. The effect of all EU law as it stands at that moment will be preserved.

Nothing will change until at least 2021 and UK legislation enacted after 31 December 2020 will take precedence over retained EU law. After 31 December 2020, the ECJ will no longer have jurisdiction over UK courts and its future decisions will not be binding. The Government will be able to pass a statutory instrument specifying which courts or tribunals will be able to overturn ECJ case law. This could lead to uncertainty if it means that retained EU case law is overruled, eg by the Employment Appeal Tribunal. The Ministry of Justice is consulting on lower courts' powers to depart from retained EU case law after the transition period. The consultation closes on 13 August. Where a new EU directive is adopted before the end of the implementation period but the transposition deadline is after 31 December 2020, the UK Government is not obliged to implement it.

After that anything is possible. There has been no official statement regarding the Government’s planned changes to employment law. We can expect some changes, as the Brexit deal struck by Boris Johnson moved references to maintaining a level playing field regarding employment standards from the legally binding Withdrawal Agreement to the non-binding political declaration. This means that the UK could decide not to align itself with EU regulations but of course this is dependent on the terms of any trade deal and the Government will no doubt have in mind the fact it owes its majority to thousands of Labour voters who voted Conservative at the last election. It has been suggested that these changes could be made:

  • A cap could be introduced on discrimination awards
  • Trade union recognition could be made more difficult. It is likely that there will be further restrictions on strikes in the transport sector
  • Changes could be made to the Working Time Regulations, including the right of workers on long-term sick leave to accrue holiday and carry over unused holiday entitlement to the next leave year, limiting holiday pay to basic pay and abolishing the 48 hour limit on working time
  • Rights under TUPE could be reduced, eg it might become easier to harmonise terms and conditions or to dismiss employees on a transfer. Service provision changes could be taken out of the scope of TUPE
  • Protection for agency workers could be reduced.