Seyfarth Synopsis: Employers should assess the potential impact on their workforce throughout the European Union.

The following alert is directed to organizations with a presence in the UK or who anticipate the need to place talent at a UK work site.

Seyfarth Shaw’s Global Mobility Practice hosts attorneys licensed to practice in the UK, Canada, and Germany. The group has the capability to assist clients with obtaining work and residence visas for over 70 jurisdictions around the world. If we can assist you in placing talent, please call your Seyfarth attorney. We will be happy to help you.

Brexit and Potential Impact on European Workforce

On June 23, 2016, British voters went to the polls to determine whether the UK would remain in the European Union. In an historic decision, the "leave" vote won by a margin of 52% to 48%. Although the polls were close in the run up to the referendum, the result has shocked the financial markets and the value of the British pound has sharply declined.

Throughout the Brexit debate, immigration was a key issue, influenced by the refugee crises throughout Europe and the pressure felt on social services due to perceived high numbers of migrants. One of the primary drivers of the "leave" campaign was the desire to curb the free movement of EU nationals into the UK, and reduce overall net migration.

What it Means for Employers

There will be a two-year transition period, during which time the UK government will negotiate the terms of its withdrawal from the EU with the remaining member states. The current UK immigration regime will continue to operate under the Points Based System, although there may be additional restrictions and increased costs introduced in the interim.

Currently, EU citizens have the right of free movement within the 28 EU member states, and may work in the UK on the basis of their EU passport. Following Brexit, although the details of the withdrawal have yet to be determined, it is likely that UK nationals will no longer have the right to work in the remaining EU member states. Likewise, it is anticipated that EU nationals will need to obtain permission to work in the UK, under Tier 2 of the Points Based System. We anticipate that these restrictions will not take place until the transition period has been completed.

Therefore, employers should immediately assess the potential impact to their business. Employers should identify within their workforce: (1) any British workers based in other EU countries; (2) EU nationals currently working in the UK; (3) the longer-term need to transfer staff within the EU. The rights of British and EU nationals will not immediately be affected by Brexit, however it is important to identify any workers whose immigration status may be impacted in the longer-term.

Although the transition period for the UK to leave the EU will take at least two years, employers should take action now, to ensure that they are prepared for an increasingly restrictive immigration regime in the UK. We will update clients as further details of the changes are announced.