The first in a new series launched by HR Heads in 2019; The Recruiters Insight. Each month, the HR Heads LinkedIn audience vote for a hot topic of the month - and HR Heads Director Jen Gaster provides her insight as a specialist recruiter with over 20 years experience of the ever changing market.
Following Theresa May’s crushing defeat in the House of Commons in January, we’re in a position of uncertainty as to whether Brexit is a reality or not. Either way, there’s widespread concern over what is going to happen in the future. The Employment Secretary has warned that the Labor Crisis will be significant if we leave without a deal, while the CEO of the Recruitment & Employment Confederation Neil Carberry has suggested that businesses are going to suffer tremendously if we don’t get this sorted. Whatever does happen, we are sure to face change that won’t be swift – it will be transitional probably over a period of two years, and that change is going to result in a significant workload for HR.
Many of the EU critics cite red tape as a factor that would not be missed should we decouple. The reality, however, might not be so clear cut. Many of the laws and legislations that we adopt and use currently are inbred through social policy – it’s intrinsic in the way we work. There are many rules and regulations surrounding race, discrimination and employment protection that are regarded as ‘the norm’ and we’re more aligned perhaps than we realise.
If we were to leave the EU, there’s a possibility we would join the EEA (the European Economic Area), and if we were to do that for our trade agreements, the reality is that we would have to adopt some EU legislation as a counterpart to that. If that were to happen, the reality of legislation completely decoupling is non-existent and we would end up being far more aligned than we think we might be today.
Immigration, and the free movement of workers across the UK and the EU is another key topic when discussing post Brexit HR. Currently, we’ve got about 2 million EU workers operating freely across the UK. Their status is pretty secure until the 2021 deadline of Settled Placement Status. The question that rises beyond that is when the new talent pool will start experiencing restrictions. We will potentially face visas, perhaps with some kind of points scoring system (like Australia) and the question then will be how many of those workers comply with that point system? Many of the EU workers in the UK at the moment do quite low-level jobs. Another consideration will be that if we impose any restriction around EU workers in the UK then we’re likely to have that reciprocated. So what implications will that have for UK workers wanting to work across Europe?
Another consideration that’s linked to the immigration and movement of workers, is the talent pool from which the UK PRC will be able to hire. At the moment, the Settled Placement Status means that that reality of change in the talent pool right now will be very minor. Post 2021, if an EU worker is not already in the UK, their right to work here will be subject to a visa and points system coming in. The implications for HR in that instance is going to be time and cost around managing that process. Many businesses may incur sponsorship costs – this hasn’t been quantified yet, but we can anticipate it as HR professionals.
We are also potentially going to have to face running operations with a reduced workforce – there is going to be a transitional phase, and it will be the smart and true HR professionals who strategically plan, that will survive it. I expect that many businesses will find themselves in a position with gaps in the work force, the talent market is already tight and that’s only going to increase.
In terms of students – we have many, many students in UK universities that come from the European Union, and those universities are instrumental to our economy, currently contributing £73 billion to our economy – £3.7 billion of which comes directly from that student pool. We need to understand what their right to study will be and how easy it will be for us to facilitate that – keeping the UK at the top of the world-wide market.
So, what does all of this mean for the role of an HR professional moving forward? It’s fair to say that the Brexit vote is not so much about the UK leaving the EU, but very much about how people fit into a new political reality.
The role of the HR Manager is going to be about steadying the ship. How do we ingratiate people to the business? How do we engage with them? How do we retain our employees, and how do we promise them a future? That’s fundamentally what we’ve got to be thinking about today. 9/10 EU workers in research have admitted to feeling worried about their future. HR are going to have to work hard to reassure workers that their future is solid.
Whatever happens next, Brexit will undoubtedly create more work for Human Resources. Those that are likely to survive the next few years through to 2021 are the ones that can strategically plan, who can organize and work agilely and flexibly, with total ambiguity.