What impact will Brexit have on employment law?

Although much UK employment law is derived from EU law, the UK's withdrawal from the EU is unlikely in itself to have an immediate impact on employment law. Following the UK's exit from the EU on 31 January 2020, EU law continues to apply to the UK during the transition period that is now in place. When the transition period ends on 31 December 2020, existing EU law will be converted into domestic law. Most EU Directives are already implemented in the UK by regulations or Acts of Parliament; for example, the EU equality Directives are implemented by the Equality Act 2010. It will be for Parliament to decide whether to retain, amend or repeal domestic legislation.

Commentators have identified the harmonisation of contracts after a TUPE transfer; the calculation of holiday pay; agency workers' rights; and the introduction of a cap on compensation in discrimination claims as examples of areas, currently governed by EU law, where changes could be made in the future by a Government looking to roll back employment regulation.

It is possible that the UK will be required to continue to implement elements of EU legislation as a condition of a negotiated trade deal between the UK and EU.

Many areas of domestic law that are derived from EU law have been heavily influenced by decisions of the European Court of Justice (ECJ), for example working time, TUPE and discrimination law. Under the European Union (Withdrawal Agreement) Act 2020, UK courts will not be bound by decisions of the ECJ made after the transition period ends on 31 December 2020. The status of ECJ decisions made before that date is now uncertain, as the Act gives the Government the power to make regulations allowing lower courts and tribunals to deviate from existing EU case law (this is a significant change from the approach of the previous Government).