The results of the EU referendum are counted and it is revealed Britain has voted 52% against 48% in favour of a Brexit. Here we share the reactions of representatives from the construction, architecture and property industries as they come in.
- PROPERTY AND CONSTRUCTION SECTOR FRET OVER UNCERTAINTY
- RIBA to ensure UK architects have “a strong voice” during negotiation process
- BPF: Brexit leaves many unknowns ahead
- FMB fears Brexit could worsen construction skills crisis
- NFB: “Clear heads making decisions for the long term” needed
- Bank of England to take “all necessary steps” to ensure stability
- BSRIA chief fires “serious questions” to the UK government
- HomeOwners alliance CEO reckons mortgage interest rates will be impacted long-term
- NLA urges calm after Brexit vote
RIBA to ensure UK architects “have a strong voice” in the future while assessing the short and long term effect of Brexit
RIBA President Jane Duncan said:
“The RIBA is a global organisation that supports its members, validates schools of architecture and champions the importance of a quality built environment around the world. UK architecture talent is incredibly resilient and we will continue to ensure that our profession has a bright future, whatever the operating environment.
“Clearly there is uncertainty about the timescales and impact on a range of issues important to our industry including free movement in the EU for architects as well as students, trading and material sourcing, inward investment relationships, EU procurement rules and the effect on the construction sector if restrictions are placed on EU migration.
“In common with other UK businesses and organisations, the RIBA is assessing the short and longer term effect of the withdrawal on our members and the Institute and we will provide further guidance in due course.
“Most importantly, we will work with colleagues in industry and government to ensure that architects have a strong voice in the coming weeks, months and years.”
Phil Williams, President of the Royal Town Planning Institute (RTPI) said:
“Despite the referendum result to leave, the planning profession will continue to be international in its outlook. Our membership reflects this with members in over 80 countries and many based in the UK who work on projects outside of the country. RTPI Chartered Membership is a brand recognised and respected internationally. There is a long tradition of sharing best practice between professionals in the UK and Europe and the Institute will continue to disseminate this.
“It is imperative that planners receive the resources needed to continue to work with all in the built environment sector to deliver development to enable growth and deal with the housing crisis. (…) It is not clear, at this stage, what impact the decision will have on planning related European Union law and directives that have been transposed into national legislation.”
The Chancellor of Exchequer speaking this morning (via The Guardian):
“There will have be action to deal with the impact on the public finances, but of course it is perfectly sensible to wait until we have a new prime minister. Of course the economy is going to adjust, and there will be an impact on the public finances, that’s what I said before the referendum, I don’t resile from anything I said before the referendum. And I said there would have to be action, actually as it happens in the autumn, to address that. I think it is perfectly sensible to wait until we have new prime minister before we address that.”
Bank of England to take “all necessary steps” to ensure financial stability
The Bank of England is monitoring developments closely. It has undertaken extensive contingency planning and is working closely with HM Treasury, other domestic authorities and overseas central banks. The Bank of England will take all necessary steps to meet its responsibilities for monetary and financial stability.
Mark Carney, the governor of the Bank of England, commented on Friday morning:
“It will take some time for the UK to establish a new relationship with Europe and the rest of the world. So some market and economic volatility can be expected as this process unfolds, but we are well prepared for this. Her Majesty’s Treasury and the Bank of England have engaged in extensive contingency planning and the chancellor and I have remained in close contact including through the night and this morning. The Bank of England will not hesitate to take additional measure as required, as markets adjust.
“A few months ago the Bank judged that the risks around the referendum were the most significant near-term domestic risk to financial stability. To mitigate them, the Bank has put in place extensive contingency plans and these plans beginning with ensuring that the core of our financial system is well capitalised, is liquid and is strong … All of these resources will support orderly market functioning in the face of any short term volatility.
“The Bank will continue to consult and cooperate with all relevant domestic and international authorities, to ensure that the UK financial system can absorb any stresses and can do its job of concentrating of serving the real economy. That economy will adjust to new trading relationships that will be put in place over time. And it is these public and private decisions which will determine the UK’s longterm economic prospects. The best contributing we can make is to continue to pursue relentlessly our responsibilities for monetary and financial stability. We have taken all the necessary steps to prepare for today’s events and in the future we will not hesitate to take any additional measures required.
Mayor of London Sadiq Khan: No need to panic (synopsis)
“I want to send a clear message to the British people and to businesses and investors around the world this morning – there is no need to panic.
“I still believe that our country is better off within the European Union, but there is no doubt that London will continue to be the successful city it is today. Our city and our country will continue to be the best place in the world to do business. And we will continue to look outwards and trade and engage with the entire world – including the European Union.
“Although we will be outside the EU, it is crucial that we remain part of the single market. Leaving the single market of 500 million people – with its free-trade benefits – would be a mistake. I will be pushing the Government to ensure this is the cornerstone of the negotiations with the EU. It is crucial that London has a voice at the table during those renegotiations, alongside Scotland and Northern Ireland.
Council of Mortgage Lenders (CML) revealed lending was at its highest for May since 2008 but senior economist Mohammad Jamei said he expected ‘reduced activity’ due to the EU referendum outcome:
“As expected, lending continued to be somewhat dampened in May, reflecting the earlier rush in the first quarter to beat the stamp duty change on second properties.
“Looking ahead, there is likely to be considerable uncertainty as a result of the EU referendum decision. We expect this to affect sentiment and reduce activity below levels that would otherwise be expected in the near term, as both buyers and sellers adopt a wait-and-see attitude until the dust begins to settle. Market fundamentals underpinning house prices still look sound, and we do not expect significant house price falls, especially given the current supply demand imbalance.”
Richard Lambert, Chief Executive Officer at the National Landlords Association (NLA), said:
“Let’s just everyone, take a long, deep, calm breath. Leaving the EU is completely unknown territory, and jumping to conclusions isn’t going to help anyone. We welcome the Mark Carney’s steadying words and his reassurance that the Bank of England and the Treasury have extensive contingency plans in place to ensure the country’s financial stability.
“Any knee-jerk reaction will have a real impact on our members’ mortgages, tenants’ rents and overall confidence in the market. So we would urge the policy as regards to interest rates should be, to continue the Prime Minister’s analogy, one of steady as she goes.”
NFB: CONSTRUCTION IS KEY TO A THRIVING UNITED KINGDOM OUTSIDE THE EU
The National Federation of Builders (NFB) hopes that the Government will not repeat past mistakes of cutting capital spending to communities and local Government. Construction remains a key driver of economic performance and will need a committed level of investment over the coming years.
Richard Beresford, chief executive of the NFB, said: “While we have a decision, there still remains economic uncertainty. What we need now more than ever are clear heads making decisions for the long term. Every £1 invested in construction generates £2.84 in wider economic benefits. This is the very time to show that the UK has the industrial capacity and intellectual capital to thrive outside the EU.”
BSRIA Chief Executive, Julia Evans, discusses the impact on construction of the UK’s decision to leave the EU, in particular with regard to skills, energy and housing.
She said: “The decision is ‘out’ and the country has voted. But we now have some very serious questions for government: how do we maintain economic investor confidence? What does this mean for energy efficiency? And how will this impact the skills issue and how we should we address this? Specifically regarding labour – how will the industry access much-needed tradesmen? Industry needs to know answers to the questions.
“BSRIA calls on government to take the lead and show direction now. With the current housing shortage crisis – we ask how are we going to find the workforce with the right skills to build these? But we must not lose sight of the fact that house building volume cannot be at the expense of quality – so such skills shortage are even more acute.
We also ask government where will direct investment now come from without EU financing and backing? If government is not going to make any necessary investment – where will it come from?
And what of carbon reduction energy policies? Will these still be followed? Industry needs to reassured and quickly.”
Phil Williams, President of the Royal Town Planning Institute (RTPI) said:
“Despite the referendum result to leave, the planning profession will continue to be international in its outlook. Our membership reflects this with members in over 80 countries and many based in the UK who work on projects outside of the country. RTPI Chartered Membership is a brand recognised and respected internationally. There is a long tradition of sharing best practice between professionals in the UK and Europe and the Institute will continue to disseminate this.”
Gobal design & consultancy firm Arcadis branded Brexit decision a ‘game-changer’. UK CEO Alan Brookes highlighted the construction industry needs to be united and UK must “keep building”.
BRE “committed to building a better world” and being “a magnet for the best and brightest people”
Peter Bonfield, CEO of BRE Group, said:
‘While the people of the UK have voted to leave the EU, we remain completely committed to bringing the best of building science to our clients and partners in Europe and around the world. We will continue to collaborate with our partners on European research projects through our well established network groups so we can share learning together and further our positive impact on the built environment for the benefit of all.
“We currently benefit from a wonderful array of very talented people who have joined us from across the EU and further afield, making us strong. We will continue to work hard to ensure we are a magnet for the best and brightest people from Europe and the rest of the world
“In or out of the EU, these special characteristics remain, and we will continue to deliver these advantages for our customers against our mission to Build a better world together.’
British Property Federation (BPF): Brexit leaves many unknowns ahead
Melanie Leech, chief executive of the British Property Federation, comments on the vote to leave the EU:
“The effect of the result has been immediate, and we are already seeing market turbulence and a fall in the pound. The priority for the government and the Bank of England must now be to stabilise the position and maintain confidence in the UK.
“It is now clear that there will be political changes ahead, but we will continue to work in partnership with government and other stakeholders so that the real estate industry, which is a considerable contributor to UK GDP, can continue to support the economy and create great places.
“The negotiation process is going to be long and complicated, and there will be many unknowns ahead. Our priority is that the government maintains focus on existing national priorities such as housing and that it makes decisions on major infrastructure projects, such as airport capacity and maintaining momentum around HS2, swiftly.”
Reaction from London Central Portfolio reveals projections for PCL prices to increase as “re-entry of investors into the market will be more rapid than originally expected”.
“Prime Central London real estate is expected to benefit from a flight to quality and the security of blue-chip tangible assets, against a background of highly volatile financial markets.”
“It is now likely that property prices in Prime Central London will increase. Whilst LCP had originally predicted that this would not occur until 2017, the signs are that the re-entry of investors into the market will be more rapid than originally expected. LCP have received a stream of enquiries from the early hours of this morning.”
Oliver Conoley, director at National Property Portfolio in Manchester had the following commented:
“I myself was surprised by the outcome of the referendum, as it appears the majority of market makers, investors and bookmakers were too.(…) With rental demands at an all time high across the UK, after what might be a brief stabilisation in house price growth, I predict we can expect to see volume of sales resume to levels seen in the early part of 2016 after the initial impact.”
Peter Ward, CEO of the United Kingdom Warehousing Association (UKWA), said he hoped there would be “no return to red tape” for UKWA members trading across Europe:
“This momentous decision by the UK will have serious global implications, bringing new challenges for British businesses and particularly for those within our industry. Many of our members trade across Europe and have enjoyed the benefits of ‘logistics sans frontiers’ for 40 years, with goods entering and leaving our country freely. My hope now is that as new trade agreements are forged, there is no return to red tape and complex customs regulations that prove burdensome and costly for UKWA members.
“The devil is in the detail and we will work hard on behalf of our members to ensure those negotiating Britain’s exit fully understand the ramifications. On the positive side, we have for some time been talking about the new opportunities for British business emerging with the big super-powers in different parts of the world; already we are focusing on the tremendous potential in China.”
Jonathan Stephens, Managing Director of property consultancy Surrenden Invest:
“In periods of uncertainty, residential property has historically outperformed other asset classes – in addition to the attractive income stream it provides. I don’t believe property in Britain’s emerging markets – Manchester, Birmingham, Liverpool – will be heavily affected. It will be London’s property that is most significantly affected by the decision, slowing down the market’s recovery. Those in the industry have been waiting for a shift in London’s investment landscape and though it may appear to worsen for the foreseeable future, the market will respond and we could see a larger correction than was predicted previously.
“With regard to demand for property, Britain is currently experiencing a housing shortage and it’s this simple disconnect between supply and demand that has driven prices and will continue to provide upwards pressure over the medium to long term. I would expect interest rates to remain low as any increase in interest rates would put further pressure on the economy.”
Alan Brookes, UK Chief Executive Officer of Arcadis, said:
“Brexit is a game-changer. The challenge for the construction industry is not simply to respond to Brexit but, more importantly, respond to the opportunities that Brexit will bring.
“Construction markets are likely to become more volatile in the short term, and we need to consider a joined-up approach to sustaining the capacity and capability of the industry. Although demand is likely to fall in some sectors this could actually take some of the pressure off over-stretched markets. Ultimately, the UK needs to keep building. Housing and infrastructure, for example, may now be able to secure capacity at a lower cost.
“One of the big questions we now face is: how can we ensure we have enough people with the right skills to build the houses, roads and rail lines of the future? In the future, European labour may no longer be the safety-valve it has been, so we must plan to use the workforce differently. Using more offsite components and investing in skills and the management of projects will now prove absolutely vital.”
Mark Weedon, Head of Research at Property Partner said:
“In the short run, housing transactions in the mainstream market are likely to remain low, but the ‘stickiness’ of residential property may prevent house prices from actually falling, with the probable exception of London’s most expensive areas. Unlike other asset classes, far fewer people are willing to sell residential property in uncertain times, which in turn further reduces supply and eventually provides upwards pressure on prices.
“The fundamentals of the mainstream UK housing market should reassert themselves. With demand still far outstripping supply, house prices should trend upwards, albeit perhaps at a slower pace. However, prime central London – areas like Mayfair, Knightsbridge and Belgravia – looks more vulnerable. The hike in stamp duty for high value properties already hit these areas hard and Brexit will not improve confidence amongst the foreign investors who dominate this market.”
Nigel Green, founder and CEO of global financial consultancy deVere Group warned Brexit is a victory for uncertainty across international financial markets and the volatility is only just beginning. He commented:
“Britain is filing for divorce from the EU – it’s a shock event. The Brexit victory is a victory for uncertainty across international financial markets. Brexit-triggered volatility is now only just beginning; we can expect it to potentially last up to two years.”
“Due the far-reaching impact of this vote, Brexit will inevitably affect the British and the European economies and the wider global financial markets. The decision may have been taken in the UK but it will impact the rest of the world too.”
“Although the impact of Britain leaving the EU will create huge short-term uncertainty across global markets, this is not the start of an Armageddon-style scenario. The world as we know it will not stop.”
“Indeed, there will be key buying opportunities for investors who will use this volatility created by markets overreacting as a time to go bargain-hunting.”
“They will, understandably, be seeking high quality equities, amongst other assets, that have become cheaper so that they might top up their portfolios and/or take advantage of lower entry points, which means greater potential returns.”
HomeOwners Alliance, an online membership organisation which offers advice and services to British homeowners, offers its perspective on the Brexit vote results.
Paula Higgins, founder and Chief Executive of the HomeOwners Alliance, said:
“This is bad news for financial markets and will probably impact interest rates longer term. House sales fell ahead of the referendum and we can expect people to continue to watch events unfold before making any big financial decisions. We can expect the rate of house price growth to slow nationwide, while in London the limited housing supply could reduce the impact on house prices.”
David Savage, Partner within the construction team at law firm Charles Russell Speechlys, said:
“The impact the leave vote will have on the UK construction industry is at this stage largely unknown. The mechanism for leaving the European Union involves a minimum of two years’ negotiation between the UK and the EU on Britain’s exit terms. Therefore, during this period there will be significant uncertainty in a number of areas within the construction industry.
“The UK construction sector has always relied heavily on workers from outside the UK to fill both skilled and non-skilled roles. Under current EU treaties, workers in member states can travel freely to the UK in order to seek work, with no work permits or visas currently required. The Brexit vote could lead to a shortage of skilled workers that would create significant uncertainly in the market, as there is a chance it may lead to an acute skills crisis. Given the importance of access to labour and flexible working, the construction industry may stand to lose more from Brexit than any other industry.”
Urban Exposure CEO, Randeesh Sandhu, comments on the ‘Leave’ result in the UK’s EU referendum and the impact on the UK property market:
“While markets may react negatively to today’s ‘Leave’ vote, the fundamentals underpinning the UK housing market still remain attractive.
“In the short-term, while there may be an impact on decision-making and activity levels, we also expect to see an increase in interest from foreign investors if sterling devalues to the extent many have predicted.
“Indeed, the UK still has unique appeal as a market for international purchasers – from the mixture of characteristics including our quality of life, culture and diversity, ownership security and legal system, time zone advantages for international business, language, schooling and education.
“A return to ‘business as usual’ may take longer than if we had remained as the specifics of a ‘Brexit’ will take time to determine and therefore there will continue to be a period of uncertainty. It is important that the government pays close attention to the key risks that could affect the sector during these talks – for example, the impact on the supply of labour, which could further exacerbate the acute shortages of skilled workers for UK construction firms if Brexit restricts migration from the EU into the UK.
“Change will come out of the UK leaving the EU, but the imbalance between demand and supply in the UK housing market will endure.
“So while buyers may pause as the implications of Brexit are figured out, over the medium to long-term we do not expect housing markets to change drastically as a result of the vote.”
CEO of leading hybrid estate agent, eMoov.co.uk and former Brentwood First Party councillor Russell Quirk comments on today’s momentous decision.
“Many will be running to their nuclear bunkers now that the apparent end of the world is nigh. But before they do, they might want to take a breath and sit tight. We’ve voted to leave the EU and regardless of personal views we must respect the democratic position of the populous. We don’t anticipate any tangible difference where the UK property market is concerned and the supply and demand balance that is currently dangerously out of kilter will see little sign of stabilising itself.
“Going forward the UK market will go from strength to strength, perhaps with wobbly knees at it emerges from the clutches of the EU, but it will soon find its feet again. There may be many buy-to-let landlords and second homeowners rushing to list their property for sale in order to maximise their profit, before the “Armageddon” on the horizon destabilises the pound. Ironically it will be these people flooding the market with additional stock that may see prices cool ever so slightly.
“However, property values increased by 6% over the course of 2015 and we predict the same rate of growth by the end of 2016. Homeownership will remain far out of reach for the average UK citizen and the overwhelming swell of demand for property will remain despite our choice to leave the EU.
“This could, however, be the final nail in the coffin for the Prime Central London market, as the capital’s high-end properties have never been less desirable in the eyes of foreign investors. With demand having slumped to record lows over the last year, it’s not looking good for the capital’s property elite.”
Donald Rowlands, Herbert Smith Freehills LLP commented:
“The jury’s out on whether an exit will fundamentally alter the UK’s status as a global investment centre for real estate. The UK is seen by some as a gateway into the EU, and by others as an integral part of a global real estate market whether or not the UK remains part of the EU.
“We have spoken to a number of our overseas investor and domestic real estate clients over the last few months. Brexit worries have undoubtedly impacted upon investor confidence in the UK investment market – volumes are well down and buyers and sellers are eagerly awaiting tomorrow’s result before re-entering the market.
“It is the uncertainty surrounding the result which has, in my view, caused the nervousness in investor sentiment. UK real estate remains an attractive investment in a volatile world where investor returns from other fixed income investments remains challenging.
The exit vote may be seen by some overseas investors as an opportunity to enter the market at a time of uncertainty and, assuming there is a continued negative impact on sterling, to benefit.”
Commercial property and real estate consultants Cushman & Wakefield react to the result of the UK referendum on EU membership
John Forrester, EMEA Chief Executive of Cushman & Wakefield, said:
“The property sector has probably followed the EU referendum more closely than any other industry and has witnessed the impact of the uncertainty and speculation in the run up to the vote.
“While the decision of the UK electorate is now confirmed, a period of further uncertainty is unavoidable as businesses, the financial markets and the political establishment in the UK, Europe and globally come to terms with what this means.
“Clearly the impact of this decision will be felt beyond the UK’s shores as the UK is the EU’s third largest market by population. We are therefore entering a period of unprecedented change as markets and sectors adapt. What is clear is that in any scenario there will always be opportunities and those will become clear in the weeks and months ahead.”
Mark Robinson, Scape Group Chief Executive, comments on the result of the EU referendum:
“The government must clarify as a matter of urgency what will happen to the EU construction workers in the UK, as they are currently filling the gap left by our skills crisis. We need to recruit a million workers into the industry by 2020, and putting EU migrants off coming here will only exacerbate this problem. For the public sector and its supply chains to plan ahead as best they can, we need to know when and how migration and employment patterns will be affected.
“Long-term projects, like HS2, could now be at risk from the economic fallout of the result. The immediate priority for the government has to be to steady the ship, and provide as much clarity as possible on the renegotiation process and the security of government-funded projects in the year ahead.”
Brexit could worsen construction skills crisis, warns FMB
The Government must ensure that our new system of immigration provides the construction sector with enough skilled workers to build the homes and infrastructure projects we need, the Federation of Master Builders (FMB) has warned.
Responding to the British electorate’s decision to leave the European Union, Brian Berry, Chief Executive of the FMB, said:
“The UK construction industry has been heavily reliant on migrant workers from Europe for decades now – at present, 12 per cent of the British construction workers are of non-UK origin. The majority of these workers are from EU countries such as Poland, Romania and Lithuania and they have helped the construction industry bounce back from the economic downturn when 400,000 skilled workers left our industry, most of which did not return. It is now the Government’s responsibility to ensure that the free-flowing tap of migrant workers from Europe is not turned off. If Ministers want to meet their house building and infrastructure objectives, they have to ensure that the new system of immigration is responsive to the needs of industry.”
“At the same time, we need to ensure that we invest in our own home-grown talent through apprenticeship training. We need to train more construction apprentices so we are not overly reliant on migrant workers from Europe or further afield. That’s why it’s so important that the Government gets the funding framework right for apprenticeships – when you consider that this whole policy area is currently in flux, and then you add Brexit into the mix, it’s no exaggeration to say that a few wrong moves by the Government could result in the skills crisis becoming a skills catastrophe. The next few years will bring unprecedented challenges to the construction and house building sector, and it’s only through close collaboration between the Government and industry that we’ll be able to overcome them.”
“Most CEA members will be surprised and disappointed by the result of the referendum. But all will now have to contend with a further period of uncertainty which will be bad for business. International companies will have to make some key strategic decisions on future investment in the UK and our exporter members will have to contend with exchange rate volatility which is already impacting on the CEA’s overseas trade promotion programme. Our partners within CECE I know are deeply disappointed by the turn of events but the CEA remains committed to continue to work with CECE as future access to the EU market remains pivotal.”
CEO of InvestSure: EU vote won’t change the challenged faced by property market
Janine Lewis of InvestSure commented:
“Today’s decision by Britain to leave the EU won’t meaningfully change the fundamentals of supply and demand. Nor will it make a real difference to the nature of the challenges the property market faces, or the solutions that are needed. Irrespective of the vote to leave, British property will continue to be an attractive destination for foreign money.
“But we also still face a severe housing crisis, with England alone needing a minimum of 260,000 new homes a year to cope with rising demand. The UK property market can either succeed or fail both within and without the EU – it won’t make a difference.”
Daniel Watney LLP, a London-based property consultancy, responds to Britain’s vote to leave the European Union.
Richard Garner, head of the commercial team, says there are reasons for London to stay positive, but the uncertainty may cause major occupiers to relocate and international investors to think twice.
James Davis, head of building consultancy, called for any new immigration system to allow the construction industry to access the workers it needs.
Richard Garner said:
“In the run up to the referendum we saw major occupiers threaten to leave if Brexit happened, and now we will see if they make good of the promises. There are a lot of reasons for them to stay in London, from convenient time zone to strong regulatory environment, but the prospect of losing access to the single market may be too much.
“For more risk-happy investors, the fall in the pound may prove a good buying opportunity, but the turbulence caused by the out vote will likely mean many stay away, with London’s safe haven status now in doubt.”
James Davis added:
“Immigration has been at the heart of the referendum debate, and limiting freedom of movement will undoubtedly be central to any deal with the EU. But the construction industry is reliant on labour from Europe and beyond, and given the skills shortage we already face, any restrictions we face will only cause further damage.”
Estate agent Waterfords CEO expected growth in the property market:
“While there is likely to be a brief period of volatility as markets adjust in immediate response, now we know for certain which way the country has voted I am confident that the strength of our economy, which is faring considerably better than many others in Europe and the World, will be sufficient to sustain a strong property market.
House prices are governed by supply and demand and aspiration for home ownership will not fade following a decision for leave the EU, nor is it likely that a torrent of new houses will suddenly come to the market. While caution may continue in the short term, I believe it is possible this could be followed by a period of growth for the market, as those who have held off decide to make a move.”
BREXIT: The implications for employment law
In what is likely to be the most significant political decision in a generation, the United Kingdom has voted to leave the European Union by a margin of 3.8%. What will it mean for employment law in the UK?
Alex Payton, Employment Law expert with Howes Percival comments:
“Many EU led employment laws are already ensconced in UK legislation and are unlikely to change. The UK will need to decide whether it wants to keep on a similar footing with the EU in relation to basic employment rights or whether it looks for a sea change. If there is an appetite for change then this is likely to remain a long way off.”
In the immediate short term, nothing will change. The withdrawal negotiations are likely to take years, with the status quo largely expected to remain intact during this period. Under the Treaty on European Union, the process for withdrawal can take a maximum of two years, and due to the complexity of the break, it is possible that even this deadline will be exceeded.
What happens following the exit is uncertain at this stage, but will turn on the type of relationship that the UK has with the EU following our withdrawal. In some instances UK employment law exceeds the minimum standards expected of EU employment law (such as maternity rights); in these areas it is unlikely any change will occur.
In areas where EU law forms the backbone of our national employment legislation, it is more likely that the government will tweak legislation, rather than overhauling it completely. Workers’ protection afforded by TUPE and the Working Time Regulations, for example, has become the norm in UK employment law, and it would be controversial if the government sought to remove such rights completely.
Despite the prevailing uncertainty, here are our views on the potential impact of Brexit in five key areas:
Our feeling is that the UK will do little to change the principles of TUPE, which applies to protect employees on business transfers and in outsourcing/insourcing arrangements. Prior to the reforms to TUPE in 2014, some argued that the UK had created more onerous obligations than the rest of Europe, particularly in relation to service provision changes. Notwithstanding this, as a result of public consultation at the time, it was reported that most businesses preferred the certainty that a UK version of TUPE brought, and as a result the UK largely stayed with its gold-plated approach. We do not therefore expect major changes in this area.
2. Working Time Regulations
Most businesses are pragmatically accustomed to the 48-hour working week, and sectors that require more from their workers cope with the use of opt-outs. Other aspects of the Working Time Regulations offer a health and safety cushion for workers (for example in the area of night-working), which balances against the need for employers to work long hours. We do not predict a significant reduction in these rights. One area that would benefit from clarification is the calculation of holiday pay, which has dominated much of the reported ECJ decisions in recent years and left us with considerable uncertainty.
3. Discrimination Laws
The UK prides itself that it remains at the forefront of equality, diversity and above all fairness. It will want to retain that even if there is a Brexit. It is therefore unlikely that there will be any amendment to the Equality Act 2010.
4. Human Rights
The Human Rights Act 1998 (HRA), when originally brought into force, was intended to allow citizens in the UK to bring their cases in UK courts, rather than at the European Court of Human Rights (ECtHR) in Strasburg, as had previously been the case. Now, the ECtHR retains its role only as the court of final appeal on matters that involve a human rights question.
The ECtHR is however distinct from the European Union and the court that adjudicates on matters of European Union law (that being the European Court of Justice). Leaving the European Union will not therefore strip the ECtHR of its role as the final appellate court on matters that concern human rights.
Despite this, the tide of anti-European sentiment looks determined to continue, and the 2016 Queen’s Speech confirmed that introducing a ‘British’ Bill of Rights is one of the government’s legislative priorities for the 2016-17 parliamentary session. Such a bill would take the place of the HRA, and abolish the role of the ECtHR as the final appellate court for the United Kingdom on human rights matters.
Perhaps the most likely changes that will occur following a Brexit will be in relation to immigration control and the free movement of labour. Expect these to become much tougher, although again much will depend on what our new relationship with Europe looks like.
Richard Arnold, Technical Director at Thomson Ecology, the UK’s largest ecology consultancy said:
“Nothing has changed in the law or policy protecting wildlife following the outcome of the EU referendum. All the protection for wildlife that existed prior to the referendum is still in place and there is every indication that it will be retained for the foreseeable future.
“Firstly, all of the EU Directives which relate to wildlife protection (Birds, Habitats, Water Framework, Environmental Impact Assessment and Environmental Liabilities) have been transposed into UK Regulations. It’s true that these Regulations could simply fall away if the European Communities Act were simply repealed, however, it is much more likely that the Regulations would be kept in place until such time they could be deliberated by Parliament. Tellingly, perhaps, the UK Law Commission’s recent review of protected species legislation recommended strengthening the legislation rather than weakening it.
“Secondly, protection for many of the species which we work with comes from national law and policy. The legislation that protects water vole and reptiles is UK legislation (the Wildlife and Countryside Act 1981) and all the species that we now consider to be European protected species (bats, great crested newts, dormouse, etc.) were protected under UK legislation before that advent of the Habitats Directive. If the Habitats Regulations were to be repealed it is likely that the current suite of European protected species would continue to enjoy protection under an updated Wildlife and Countryside Act.
“Thirdly, some protection for biodiversity transcends the European Union, notably the Ramsar Convention and the Convention on Biodiversity, to which the UK is a signatory. This means that we have an international commitment to work towards halting the loss of biodiversity, regardless of the status of our membership of the EU.”
GGF open-minded about Brexit
Following last week’s EU Referendum and with the UK population voting to leave the European Union, the GGF remains open-minded about the changes that will come and will continue to work with parliamentarians and Government departments on the many issues affecting the glass and glazing industry.
Nigel Rees, GGF Chief Executive commented,
“The GGF Membership can rest assured that we will continue to deliver the same level of benefits and service for our Members. In the short term, we must wait until the Party Conferences this autumn and see how the political parties shape their leadership, policies and direction going forward. There is no doubt that the implications of Brexit and the political uncertainty is already sending economic shockwaves through the construction and property sector, the scale of which may not be clear for some time and as such a tough trading climate that will impact companies both large and small is anticipated. In the meantime, we remain open-minded and will work in the background with our political advisers GK Strategy, our Members and key influencers in the broader construction industry to plan for all scenarios. I am confident that the Federation will be in a stronger lobbying position once the dust has settled on last week’s referendum. We will of course continue to keep our members, well informed as to the unfurling impact on our campaigns and our activities to ensure they are well-positioned to cope with any changes.”