Before the 2016 Brexit referendum, there were many dire predictions about how leaving the EU would lead to a bonfire of UK workers' rights. Many key employment rights (including paid holiday, protection against discrimination, TUPE, equal pay and restrictions on working time) come from EU law. Since the UK formally left the EU, none of these predictions had borne fruit. But that may be about to change.
The Retained EU Law Bill announced by Liz Truss' government before her resignation has three key effects. First, it enables the Government to revoke EU-derived laws that are in the form of statutory instruments (essentially, anything called "Regulations" rather than an "Act"). Secondly, it provides that all EU-derived regulations and EU legislation that were retained on the UK's withdrawal from the EU will be repealed at the end of 2023 unless the Government legislates to retain them. Third, it gives courts and tribunals much wider powers to depart from EU law when interpreting UK law.
This could have a huge impact on UK employment law. The Working Time Regulations (paid holiday and rest breaks), Agency Worker Regulations, protections for part-time workers and fixed term employees and aspects of TUPE could all be repealed or significantly changed. While the purpose is to make the UK more competitive, the short-term effect may be uncertainty. Employers will hope that the Government sets out clear plans as to which laws are likely to be retained.
It remains to be seen whether the new Prime Minister, Rishi Sunak, will press ahead with the Bill. Further, we now know that the mooted reversal of the off-payroll working rules and the reduction in the top rate of income tax will not take place.
As businesses face turbulent economic times, they will also face significant changes, albeit changes which are designed to reduce the regulatory burden. It remains to be seen whether these will be enough to help businesses weather the storm.
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