Brexit: What will happen on 1 February 2020?

After much delay, the UK will leave the European Union at 11:00pm on 31 January. But with the arrangements for Brexit still unclear, how should employers be preparing for life outside the EU and will they see any immediate changes from February? Ashleigh Webber reports.

There are now just two weeks until the UK leaves the EU – 34 months after former prime minister Theresa May invoked Article 50, beginning the withdrawal process.

Some organisations may breathe a sigh of relief: will the UK’s withdrawal on 31 January end years of uncertainty exacerbated by delays to the process and political upheaval?

However, firms might also be anxious about what the future holds and what they should expect come 1 February – the first day of the transition, which runs until 31 December 2020. During this period, the UK is not technically in the EU, but is expected to abide by its rules.

So, exactly what will change for employers in February?

Not much, suggests think tank the Institute for Government, but employers still need to prepare for the future impact Brexit might have on their employees.

“The practical realities of Brexit will not be felt on 1 February 2020. The transition is largely a standstill agreement, preserving the status quo,” it says in its Getting Brexit Done report.

“The change at the end of the transition will, on the other hand, be significant. Under the deal envisaged by the government, border controls and checks will come into force, a new immigration system must be in place to replace free movement, changes to fisheries and agricultural policy will begin, and public bodies and regulators will need to take on new roles and responsibilities.

“The realities of Brexit, from a practical and administrative perspective, will be obvious for the first time [at the end of 2020] – government, businesses and individuals will need to be ready.”

From an employment law point of view, there are no anticipated changes as UK employers will be expected to continue to follow EU rules until 2021. There is also strong public support for the protection of existing workers’ rights beyond this date, despite government plans recently being criticised for lacking clarity on this area.

But since the EU referendum in 2016, a major concern has been how Brexit will affect access to the staff employers need, especially in sectors that rely on overseas labour like healthcare, social care and hospitality.

Even though a deal has not yet been struck, it is understood that Brexit will end the free movement of EU citizens between the UK and EU nations and a new immigration regime that covers all non-UK nationals will be brought in.

Just what impact this will have remains to be seen, but immigration from the EU has decreased substantially since the referendum and this downward trend may continue depending on if a deal is struck. According to the latest Office for National Statistics estimates EU net migration stood at 48,000 in the year ending June 2019, compared with over 200,000 in 2015 and early 2016.

As things stand, EU citizens will still be able to enter the UK freely during the transition period, so employers will still be able to access workers during this time. If the UK leaves without a deal, these staff and their families will need to apply for European Temporary Leave to Remain status to continue to live and work in the UK in 2021.

As Jonathan Beech, managing director at immigration law specialists Migrate UK tells Personnel Today: “[the transition period] will be similar to the last couple of rounds of negotiating Brexit and the deal itself: Should the UK leave the EU from 1 February 2020, then the immigration regime will only really change should there be a no-deal with any of the member states.

“In this situation, those EU citizens entering the UK from a date (to be determined – but it could be 1 February 2020) will need to apply for Euro Temporary Leave to Remain which will provide three years of stay and allow work,” he says.

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“Although there will be immigration rules changes expected through the year, as per normal, the new immigration system is expected to go live from January 2021. This coincides with a deal situation.”

Despite this, Beech warns it is still unclear whether all European citizens currently living in the UK are able to remain. Employers need to encourage staff who haven’t yet done so to register under the EU Settlement Scheme by 31 December 2020 if the UK leaves the EU without a deal. This may be extended to 30 June 2021 if a deal is agreed.

Settlement Scheme

Although 58% of applications for Settled Status and 41% of applications for Pre-Settled Status have been approved, an estimated 900,000 Europeans living in the UK have not yet secured their status. This is roughly a third of EU nationals living in the UK.

The AIRE Centre, which specialises in EU law, claims that many EU nationals are putting off their applications, don’t understand what they need to do, or their application is one of around 362,000 still to be processed by the Home Office. Government figures show that more than 2.7 million applications for Settled Status were received up to 31 December 2019.

“The contribution EU workers make to the UK economy and to business is unquestioned, but many are put off by the red tape and complicated process. Businesses need to take action now, and failing to do this is tantamount to ignoring a ticking time-bomb,” says AIRE Centre director Matthew Evans.

Complexities in the application process mean that some people eligible for Settled Status are mistakenly entering the wrong information, putting their future in the UK at risk.

“My concern still remains that some people are being granted Pre-Settled Status when in fact they’re entitled to Settled Status. A simple press of the wrong button could mean that people are inadvertently being granted the incorrect status. If people think they’re entitled to Settled Status, they shouldn’t accept Pre-Settled Status,” says Chetal Patel, a lawyer at Bates Wells.

There will be a clearer picture of what the future immigration system will look like when the government publishes its next immigration white paper. The Queen last month announced the government’s intentions to introduce a skills-based immigration system, and the paper will likely reveal more detail about this. The Migration Advisory Committee is also set to report on its recommendations on 28 January.

However, Jonathan Beech warns employers to expect the cost of sponsoring overseas citizens to increase, both in the short term and for long-term stay beyond 31 December.

“Employers will need to think carefully about their annual Certificate of Sponsorship allocations from 6 April 2020 as this could overlap with EEA citizens requiring sponsorship from January 2021,” he explains.

Right to Work checks

Organisations will not immediately need to change the way they ensure staff have clearance to work in the UK during the transition period, as Claire Nilson, a lawyer at Faegre Baker Daniels, explains: “A Brexit date of 31 January will not affect right to work checks immediately. HR professionals can continue to check an individual’s right to work in the UK in exactly the same way as they are now up until the end of December if the UK experiences a no-deal Brexit.

“As we move towards the end of that transition period, we anticipate that the right to work check form and procedure should be updated by the authorities,” she adds.

Although there will be no major changes overnight on 31 January/1 February, employers must monitor progress in negotiations and advice on the government website to ensure they know what to do once the transition period ends. Unfortunately, its likely that the uncertainty experienced over the past three-and-a-half years will continue in the coming months.

“There won’t be any immediate changes for employers,” Nicholas Le Riche, a partner at law firm BDB Pitmans says. “However, as details of the final Brexit deal are still to be determined, employers should keep themselves and potentially affected staff updated as we reach the end of the transition period in December this year.”

The CBI said employers should look out for announcements about trading arrangements and the new immigration system and consider how these will affect them. They should also consider how they can feed into government plans for Brexit, suggests Josh Hardie, CBI deputy director-general.

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