The Uncertainty of Brexit and Its Impact on Recruitment - NPAworldwide
Today’s guest blogger is Simon Whitehead, the founder of HRC Law, based in Manchester, UK. Simon is known for his practical and commercial approach and his firm works with a large number of UK based and international recruitment businesses. Simon works regularly on the following: business purchases and sales – shareholder agreements and corporate structures; employee retention and attraction – share options, employment contracts and service agreements; settlement agreements and exit strategies; TUPE transfers and issues relating to outsourcing; employment tribunal claims including discrimination claims; business protection issues including confidentiality, social media and post termination obligations; data protection and regulatory issues; and debt recovery and business disputes. Should you wish to connect with Simon he can be contacted at firstname.lastname@example.org.
Are there any certainties about Brexit? After the High Court Ruling on 3rd November 2016 stated that the decision to trigger the exit negotiations need to be agreed by Parliament and not just the Prime Minister, I think the answer is “no”!
It’s unlikely that Article 50 will be triggered in March 2017 as planned or that we will have a clear plan about what Brexit means anytime soon. I agree with lots of commentators that currently the only certainty about Brexit is the uncertainty that it creates.
Anecdotally Brexit is already impacting on our recruitment clients even before we know what it means and when it will happen. Those recruiters who work with niche clients who rely on highly skilled foreign candidates are seeing an increase in work as hirers take advantage of the certainty of the current points based system to secure clearance for the right to work in the UK and are keen to recruit from abroad whilst they know how that can be achieved.
Those recruiters who have relied heavily on foreign workers to fill seasonal demand in supply chains are reporting a real struggle to find enough people to fill the available positions, even before the peak period has got properly underway. They are reporting that the weak pound and the perception of the welcome that they would find in the UK, post Brexit, is meaning that similar roles in other European countries are more attractive and workers are looking to locations other than the UK to find work. We are also hearing that end users are choosing to invest in European countries other than the UK post Brexit, with one client choosing to open a European office over a further branch in the UK.
Generally, clients are reporting that end users are delaying their decisions on recruitment which is impacting on their ability to place workers and their bottom line. Overall the uncertainty created by Brexit does not appear to be conducive to a positive business environment for recruiters and as such, the sooner we have a clear picture as to what Brexit means and when it will happen the better.
If Brexit does take place, then there are a number of changes which could take place and impact on the recruitment sector. When and how these changes would impact is of course not clear. It’s likely that we will have a new immigration system for foreign workers wanting to come and work in the UK. Whether the need for authorisation to work will spread to existing European countries which currently enjoy free movement, we’ll have to wait and see.
The most likely piece of specific recruitment legislation which would be withdrawn following Brexit are the Agency Workers Regulations. This piece of legislation is generally perceived as being of limited use due to the complexity and the available exceptions. Its removal is likely to be welcomed by the industry due to the administrative burden it creates.
Beyond the Agency Workers Regulations and the changes to the free movement of workers any changes are likely to have limited impact on the recruitment sector. As already stressed we have a long way to go before we know exactly what Brexit means and when it will impact. I hope that the uncertainty doesn’t create the industry more difficult issues to deal with in the meantime.
By Veronica Scrimshaw