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Brexit – where are we now, and what’s next?

After all of the excitement earlier in the month, with resignations left right and centre and suggestions of a vote of no confidence in Theresa May, it's all gone a little bit quiet…

Theresa May is (currently) due to take the draft Brexit deal to parliament on 11 December. There are reports that one cabinet minister, Penny Mordaunt, has asked Theresa May for a free vote in parliament, suggesting she was planning to vote against the deal. Hardline Brexiters, such as Jacob Rees-Mogg and Boris Johnson say they plan to vote against the deal because it is too soft. Labour, the SNP, the DUP and 51 Tories have said they will not vote for it.

If Parliament does not approve a deal, then we risk a “no-deal” Brexit becoming a reality. A "no-deal" Brexit could mean us leaving the EU without any agreement reached on important issues such as trade, the status of EU citizens in the UK or UK citizens in the EU. The BBC has produced this useful graphic to assist us all with getting our heads around the current position…

But practically, what does all of this mean for businesses?

The CBI (Confederation of British Industry) was one of the first groups to come out in support of Theresa May's draft deal. Having initially stated that any form of Brexit would be bad for business, faced with the prospect of a no-deal Brexit, it has come out in support of "some deal", rather than no-deal. Certainty, in the eyes of the CBI, is key. For more information on the CBI's perspective on a no-deal Brexit, see here for a fact sheet prepared by the CBI earlier this month.

The impact of Brexit, if it happens, on day-to-day employment legislation is likely to be limited. Although a significant proportion of UK employment law is derived from the EU, it is unlikely that there will be wholesale changes following Brexit.

The greatest practical implication for employers is the likely change to the right of freedom of movement of EEA nationals if we exit the EU. Businesses are already reporting difficulties in recruiting and retaining employees. Some decisions have been made as part of the Brexit negotiations about immigration rules for the immediate post-Brexit period, but they are transitionary rules and in any event, will only come into play if Brexit actually happens. This is what has been so frustrating about the political chaos in recent weeks – it doesn’t seem to have brought us any closer to knowing what to expect next. If a deal is reached, free movement of workers will come to an end in January 2021. Going forward, new workers will likely need to obtain a visa to live and work in the UK and workers that are already here will need to apply for "settled status".  Some of the most ardent criticisms of Theresa May's draft deal have been in relation to the fact that the immigration of highly skilled workers will be prioritised under the draft deal. As one Guardian contributor put it – "Dutch bankers and French chefs will remain welcome. Bricklayers from eastern European accession countries – not so much" (Craig Berry, Manchester Metropolitan University).

What is perhaps most important to note from an immigration perspective is that in the event of a no-deal scenario, free movement of workers could end by 29 March 2019. In such a scenario, it seems likely that EU citizens who are already in the UK will be permitted to stay (and work) after the 29 March 2019 deadline, however what the position will be in respect of EU citizens who arrive in the UK after this date is yet to be finalised. A transition period (where free movement is retained after the 29 March 2019) is therefore likely. In respect of UK citizens living and working in the EU, the plans are not clear in the event of a no deal. Businesses who are considering relocating should therefore bear this in mind.

Keep an eye on our Acuity twitter feed for short Brexit updates as and when they happen. For employment law advice and support, or for bespoke training on employment and other matters delivered in house, please get in touch with Claire or Rebecca

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