Everyone has a view on BREXIT (Don’t they?). Here at Kingfisher HR we are interested in the debate both in terms of the general business implications and the likely knock on effect for employment law. Here is a quick run -down of some of the arguments for and against. Much of the arguments are highly speculative, as there are limited precedents available. Although Brexiters have painted a rosy picture with potentially high reward we all know that with high reward comes high risk. Are we really prepared for that risk to materialise? How committed are we to stepping out into the unknown?

 

In Favour Leaving the EU

  • UK would regain full control over our labour, tax and trade regulations.
  • UK would save membership fees ( but see below comments on loss of free trade and inward investment)
  • Ukip has stated that Britain could follow the lead of Norway, which has access to the single market but is not bound by EU laws on home affairs etc. (However whether we could in reality work out a conscious uncoupling remains to be seen!).
  • The UK’s ties with American intelligence services may become stronger.
  • UK could chose to shadow EU laws where considered favourable, however this would be more likely to be subject to short term political lobbying as opposed to long term planning.
  • Some SME’s anticipate that under an exit they would be bound by a less burdensome regulatory regime ( but see comments below on Norway model)

Against Leaving the EU

  • We don’t currently know how post-Brexit UK-EU trade relations would pan out – negotiating details of the withdrawal could take several years and as a result the pound could be very volatile, trade may be interrupted or put on hold.
  • The EU has driven the equality agenda historically and will likely continue to do so. Non EU countries have significantly less protection in place e.g. America where there is no statutory holiday pay or maternity leave – and whilst red tape can be burdensome on business ultimately poor levels of protection for workers can have a negative knock on effect on society as a whole.
  • EU may be more likely to fragment over the long term should other members follow our lead.
  • Once we are out then there is no guarantee that we could re-join or even re-join on suitable terms.
  • If we follow the Norwegian model for exit then we could find ourselves agreeing to be bound by EU law in return for favourable trade agreements etc with no say in future developments regarding such legislation.
  • Norway currently pays a comparable amount per head as current EU members and perceived costs savings may therefore be incorrect.
  • Although pro-exit commentators have painted a rosy picture of the UK developing as its own independent super economy this is in no way guaranteed and could in fact go the opposite way. An exit might offer potential high reward but clearly it is also very high risk and large businesses could decide to move out of the UK.