How does Brexit affect the UK recruitment sector?

The UK left the single market and customs union on 31 December 2020.  

What is the impact of Brexit on the recruitment sector?

Our lead international partner, Simon Hart, explains the key post-Brexit issues facing recruitment businesses:

Passporting – freedom of establishment 
Under the new Brexit deal, the Trade and Co-operation Agreement (TCA), the UK has lost its passporting rights, ie once a company is established within one EU country, it can sell its products or services to all other EU states without the need to have a branch or subsidiary there. It is worth mapping out where your client base is across the wider European Economic Area (EEA) to identify the potential impact on your business and what might need to change in 2021.

End to free movement
Freedom of movement for UK nationals within the EU27 ended on 31 December 2020. The TCA includes temporary mobility rights, but these are limited by comparison. We recommend recruiters check local restrictions for any EU country they are placing candidates. 

No mutual recognition of professional qualifications and equivalence status 
Under the TCA, the UK has lost its mutual recognition of professional qualifications apart from the medical profession. The TCA has left it up to individual regulatory bodies to sort this out themselves. There is ongoing uncertainty and there has been a lot of lobbying on this issue from professional bodies in the UK.  

Data and privacy 
Movement of data/GDPR is a key issue in the recruitment sector. Pre-Brexit, the UK had alignment with the EU through their GDPR legislation. The TCA says there will be a roll over of existing data provisions until 30 June 2021. After this, we may see changes. This is something to keep an eye on so we don’t fall foul of any GDPR divergence. 

The indirect impact 
Business uncertainty continues as the negotiations with both the EU and US carry on and many business leaders are understandably concerned about the impact of this. We will keep you up-to-date with the latest developments, and you can find insights on taxation, strategic business planning, talent and people matters, as well as regulatory impacts and trade deal announcements on our Brexit insights page.

Contact us

To discuss the impact of Brexit on your recruitment business, contact Neil Thomas or Simon Hart.

Brexit - into 2021

There is no doubt that Brexit will have far-reaching impacts, with reverberations felt across every sector. Many in the business world will understandably be concerned.

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