December 4, 2018

Brexit - right to work issues for employers

The government claims the likelihood of Britain leaving the EU without a deal is more likely if MPs reject Theresa May's Brexit deal in the Commons vote on 11 December.

Our recent update focused on the Migration Advisory Committee's recommendations for the Tier 2 work permit scheme to be extended to EU nationals after Brexit. Most notably, it was revealed that the UK will focus on acquiring the best skills available and that EU nationals should no longer receive preferential treatment by virtue of their citizenship.  This raises the prospect that, in the event of a 'no deal', from 30 March next year employers could find themselves having to 'sponsor' EU nationals to work in the UK, at great expense and increased compliance whilst also experiencing difficulty in recruiting for lower skilled roles.

At the end of last month, the Immigration Minister was before the Home Affairs Committee trying to explain how this could affect employers.  In particular, she was trying to articulate how employers would be required to decipher between EU nationals who were in the UK before 29 March 2019 and so able to register under the EU Settlement Scheme or similar, and those who arrived after that date and are 'new' arrivals.  She mentioned, to some degree of condemnation and confusion, it would be "almost impossible" for employers to do so in a 'no deal' scenario.  Equally, even if a Brexit deal is agreed, and the implementation period to 31 December 2020 stands, there will still come a point where employers are required to determine who is 'in' and who is 'out'.

The Immigration Minister was somewhat ridiculed for her comments and attacked for the lack of clarity.  But it could be said it was a case of "don’t shoot the messenger".  Employers have long been tasked with following strict rules when it comes to deciphering whether employees have the right to work in the UK.  Regardless of nationality – be that British, European or any other, employers must always check the appropriate documentation before the employment commences. The difference here though is that employers will face the extra headache and practical reality of dealing with the issue post-Brexit.  For example, employers will likely be faced with EU nationals asserting that they have visited the UK fairly frequently prior to Brexit. Are they required to have permission under Tier 2 before they can work or could they potentially apply to register under the EU Settlement Scheme along with all other EU nationals who have been working in the UK?  If Tier 2 does apply to EU nationals as soon as 30 March 2019, many employers would be left flat-footed and scrambling to apply for a Tier 2 Sponsor Licence and understand the rules.  There would likely be huge pressure on employers to allow EU nationals to enter the UK as visitors on the basis they are not working, with the reality being in the balance as to whether they should be applying for permission to work in the UK.  For large employers with a pan-European workforce, it is likely to be a significant day to day issue.

As a result of the Immigration Minister's comments before the Home Affairs Committee, the Home Secretary clarified that there would likely be a transition period from the point of Brexit in which employers could be granted some breathing space.  Regardless, the time will come when employers are required to make tricky choices in determining which rules apply to each employee.  Given there are severe civil and criminal sanctions for employers that get this wrong, employers will need to carefully consider the position of each EU national employee working in the UK.

The UK has not formally made a clear commitment to the terms of the EU Settlement Scheme.  In the event of a 'no deal' scenario, this is one of several reasons why eligible EU nationals may wish to try and protect their position by applying for, and ideally obtaining, Permanent Residence or a Registration Certificate before 29 March 2019.