Workforce planning ‘can't afford to wait in wake of Brexit uncertainty’

Latest political turbulence highlights urgent need for employers to brace for ‘very tough environment,’ CIPD warns

The deepening uncertainty surrounding the Brexit process and the broader political landscape should serve as a crucial reminder of the need to introduce robust workforce planning measures, experts have warned.

Wednesday’s draft Brexit agreement between the UK and the EU confirmed that the rights and status of EU nationals in the UK would remain unchanged until Brexit was completed, as the government had indicated at the beginning of the month.   

But the potential difficulties faced in ratifying the agreement through parliament, and the possibility of a no-confidence vote in prime minister Theresa May, are likely to further rattle employers and labour markets, and place the prospect of a final settlement regarding a post-Brexit visa regime further away than ever.

Ben Wilmott, head of public policy at the CIPD, said: “Regardless of the uncertainty and not knowing what shape Brexit will take, the certainty is that we will see restrictions on EU nationals coming into the UK in the future.”

The rights of EU migrants to work in the UK after Brexit remain a significant unknown, though the government has said it is committed to a skills-based regime. The concept of settled status will replace permanent residence for EU migrants, with a scheme to apply for the new status fully open from 30 March 2019. EU nationals who have been resident in the UK for five years will be eligible to apply, and the scheme is expected to open regardless of whether a Brexit deal has been agreed at that point.  

The latest quarterly Labour Market Outlook from the CIPD revealed earlier this month that employers were facing a supply shock. More than two in five UK employers (44 per cent) reported they had found it “more difficult” to fill vacancies in their organisation over the past 12 months as the UK becomes a less attractive destination for prospective workers. 

Wilmott said: “This latest turbulence is a reminder that we are facing a significant disruption to the UK economy. It’s really crucial employers start to workforce plan, really understand the make-up of their workforce, look at what they require as a business and start thinking about how they are going to adapt their recruitment and people management practices to make sure they are able to recruit as wide a talent pool as possible.

“Part of the planning to become more resilient is really understanding workforce strategies and making sure they can continue to find the skills and people they need in what could be a very tough environment,” he added.

Jessica Pattinson, head of immigration at Dentons, said the continued lack of information provided to businesses during the political impasse was frustrating. 

She said: “There’s still a lack of information on the UK’s relationship with the EU and what that means for the mobility of people. We are eagerly awaiting information on that. The potential that we’re still going to end up in a no-deal scenario and not have a transition period is a huge concern in terms of people.”

She said the priority now had to be securing a deal with the EU as we “stare down the barrel of a no-deal Brexit.” Should that materialise, she said, the government would have to act quickly to put temporary measures in place to ensure business continuity in areas covering trade in goods and services as well as movement of people.

The draft agreement contained no mention of the rights of UK nationals working in the EU, beyond a future commitment to resolve mobility of workers between the UK and EU once Brexit is completed. And Labour also highlighted the lack of a commitment to retain current legislation regarding employment rights during the transition period which begins in March 2019.

But Chris Brazier, senior employment associate at BP Collins, was more optimistic, saying it was “pretty unlikely settled status wouldn’t come in, even if this agreement doesn’t get through parliament.”

He advised employers to talk to their EU nationals to ensure they are aware of their rights to stay in the UK.

“Employers are part of the taskforce making sure this information is broadcast to EU nationals,” he said. “It’s not just going to be a government campaign – they want employers and everyone to be making sure EU nationals take this [settled status] step.”