Since the UK left the EU on 31 January 2020, EU laws have been consistently removed and often restored in some new form within domestic law. But the sheer breadth of this legislation means that if every one of these laws went through the full parliamentary process, the body would have little time to do anything else.
The Retained EU Law Bill aims to avoid this problem by automatically ‘sunsetting’ a huge portion of the legislation at the end of this year. Some retained EU laws can be extended beyond this date if ministers wish, and they will also be able to amend or replace legislation more easily.
It is difficult for accountants to help businesses plan when there is such ambiguity
This could prove quite disruptive for businesses, simply because of the quantity of legal changes that are happening.
It is difficult for accountants and payroll teams to help businesses plan effectively when there is such ambiguity around whether the law will pass and its potential impact. We need urgent clarity from the government on which, if any, regulations will be retained or replaced with UK equivalents.
What might change?
Although it is likely that most of the EU-derived laws will remain in some form, there are some that may change that will be of particular interest for payroll and accountancy teams.
These include part-time and fixed-term worker regulations, maternity and parental leave, rights to written terms and conditions, and the Transfer of Undertakings (Protection of Employment) regulations.
Many regulations regarding working hours, paid leave and employee protection may be removed or replaced
We’ve heard very little from the government about specific retention plans in any of these areas – and there are hundreds of laws pertaining to employment as part of the bill. Although the potential changes to such legislation may not take place until December, some advanced indication will be necessary for UK businesses to plan accordingly.
The Working Time Regulations are a key example. This retained EU law sets out the length of the working week, entitlement to breaks, entitlement to at least one day off a week, paid holiday and rules surrounding night workers.
The regulation covers almost all employees. It is likely that the government does not want to tear it up wholesale. But given how crucial these rules are for how businesses operate, some clarity would be welcome. Unfortunately, however, this example is just one small area of the 4,000 laws and regulations derived from EU legislation – so there is a lot for the government to clarify.
Need for focus
It could be argued that the government is simply not focused enough on the bill and its impact on UK businesses. Although we may have hoped for further clarity after the bill’s third parliamentary reading in January and subsequent debate in the House of Lords, the most concrete response given was that the legislation would be reviewed in relation to the UK’s economy.
The most concrete response was that the legislation would be reviewed in relation to the UK’s economy
There is no doubt that the retention or revocation of many EU employment laws will have a massive impact on employment practices in the UK. Many of the regulations regarding working hours, paid leave and employee protection may be removed or replaced, likely causing significant disruption and confusion.
While we await clarity from the government, accountants and payroll bureaux must prepare for many of their current employment law practices to be completely reformed or revoked.
