24 January 2023
At the third reading of the Retained EU Law (Reform and Revocation) Bill (‘the Bill’) last week, the government successfully voted down a requested delay to the revocation of retained EU law until 2026. Whilst a starker challenge awaits when the Bill proceeds to the House of Lords, the government is still on course for possible employment reforms by the beginning of 2024.
The stated purpose of the Bill is to revoke or modify certain retained EU laws, which have largely remained unchanged since the UK’s withdrawal from the EU, and allow UK courts greater freedom to depart from retained EU case law. Also included within the Bill is a sunset provision (essentially a deadline), which will result in all retained EU law being revoked by 31 December 2023 unless the government has taken steps to preserve them by enacting UK legislation. The impact of this sunset provision is that many UK employment laws could be revoked at the end of the 2023 unless the government has specified otherwise. That could mean laws concerning the limits on working time, rights to holiday entitlement and pay, parental leave rights, health and safety rights and the rights of employees when a business is being acquired could, at the stroke of midnight on 31 December this year, no longer have effect.
Whilst that is unlikely, it is still possible given the tight timescale the government has set itself to consider what retained EU law to revoke or modify, and the lack of scrutiny required of parliament to analyse the impact of any proposed modifications. With 2,000 retained EU laws already under review, expectations that this will grow to 4,000, and the government refusing to say whether any modifications will be limited to the retained EU laws it has identified, it is a huge task and entirely plausible to see some things slipping through the cracks.
Whilst many employers may see the benefits of sweeping changes to those UK employment laws derived from EU law, established businesses with processes in place to comply with current retained EU law may find themselves unsettled at the pace of change and caught out by more agile competitors. Undoing current practices could also prove too costly for them to implement in such a short time frame. Those employers that wish to maintain trade links with the EU (including Northern Ireland) will also likely find that they cannot derogate from retained EU law if they wish to continue that trade.
The opportunity to consider how retained EU law could be modified to improve the UK’s lagging productivity will have its benefits; however, careful consideration of what to modify, how and the impact on business and the workforce requires significantly more time than the government currently intends to provide.
If you have any concerns regarding the Retained EU Law (Reform and Revocation) Bill and how it may impact your workforce, please contact Charlie Barnes.