As the dust settles on the historic referendum result, many small and medium sized businesses are wondering how leaving the EU will affect their ability to recruit the staff they need and what effect the decision will have on the people they currently employ – and what, if any, action they may need to take.
No-one knows what the long term affects are going to be at this point. Although speculation is widespread, in the short term, it will be business as usual – and with current legislation so embedded in UK employment laws, it will be interesting to see how any future changes to worker’s rights can be influenced.
Whatever the questions, there will be many positive and negative answers regarding leaving the EU, but it really is too early to predict the true implications from a practical viewpoint.
There is a strong possibility that to continue trading within the EU, the UK will have to agree to continue with the free movement of people – so changes would be minimal.
However, without such an agreement, EU nationals will be placed in the same position as non-EU nationals and subject to UK immigration law, so it may be harder for businesses to recruit and employ EU workers. This would have a significant impact on the labour market within key industry sectors such as construction, education, healthcare, hospitality, production/manufacturing areas etc, which all rely heavily on EU workers.
Responding to the vote leave announcement, Recruitment & Employment Confederation (REC) chief executive, Kevin Green said: “Nothing will change overnight. There will be a prolonged period of renegotiation and readjustment. During this time government needs to do everything possible to help businesses to grow and create jobs.
“That involves outlining a timetable of renegotiation to help organisations make informed strategic decisions. We call on policy-makers to set out the plan for implementing changes to employment regulations such as the Agency Workers Directive and the Working Time Directive.
“We need to ensure that British businesses continue to be able to get the people they need to fill the jobs available. Access to talent is absolutely vital to sustainable economic growth and prosperity.”
The question of what happens to EU workers that are currently employed in the UK, will also need to be tackled. Without an agreement in place, many will have to give up their jobs and return to their native countries. However, the same can be said for the thousands of UK citizens working in the EU, so it would be difficult to see how a mutually beneficial arrangement would not be established to cover this.
In fact, UKIP’s Douglas Carswell wrote in the Times newspaper, last year: “Perhaps the greatest failing of the immigration system is that it discriminates against precisely the sort of people who, in a world of increasing labour mobility, we might actually want to attract.”
It’s easy to be blown off course by everything that is being reported but the main point is not to panic – just carry on with your investment and recruitment strategy!
Simon Walker, director general of the Institute of Directors (IoD), revealed the findings of its survey prior to the Leave decision, saying: “Dealing with Brexit would be a challenge for most directors, who think it would have a negative impact on trade, research, and access to skills. However, more members than not think the UK could ultimately make an economic success of leaving the EU, in particular believing that it would have a positive effect on employment red tape.”
The survey also revealed that a quarter of companies planned to put a freeze on recruitment, whilst nearly a third said they would keep hiring at the same pace. Only 5% said they were looking to cut jobs.
We know that there will be no changes for at least two years, maybe more, so a steady ship is required as we inevitably go through the choppy waters on our voyage to a new World!