On 31st January 2020, the United Kingdom formally left the European Union. The UK has now entered into a new trading partnership with the EU under the EU-UK Trade and Cooperation Agreement. New rules now apply on exports, tariffs, data and employing people from within the EU.
Although this meant that No Deal was averted, most observers on both sides of the political debate would recognise that it was a hard Brexit, with the UK leaving both the Single Market and the Customs Union.
For those who voted for Brexit, the main appeal appeared to be around the notion of capturing a sovereignty which had existed in the past, but had been lost to a foreign power. It is important to understand though that any loss of sovereignty had in fact been “loaned” freely by successive, sovereign UK Parliaments to the European Union.
The emotional forces which unleashed Brexit will remain in play in 2021 and beyond, and will undoubtedly have an influence on the path Brexit takes, but their direction is unpredictable.
Some international observers maintain that the UK will be embarking on a post-Brexit journey in 2021 and beyond, without even the vaguest of route maps. Others will of course argue that there is no need for such a map and that a sovereign people and sovereign Parliaments will have the freedom to decide upon and alter course as they chose.
It is often heard from pro- and anti- Brexit supporters alike, that the post-Brexit plan is the creation of a ‘Singapore-on-Thames’. Depending upon perspective, this could equate to a recipe for a much more entrepreneurial society with few safety nets or, for a much more unequal society with much lower labour and environmental standards. Nearly 5 years after the referendum debate, there is no detail on the overall direction the UK is heading in.
Brexit and employment in 2021 – what do we know?
Given this uncertainty, what can be said about 2021 and beyond in a post-Brexit UK?
The UK will no longer enjoy frictionless trade with the EU. Another is that the trade agreement which is in place largely covers goods and that if there is to be any agreement on services, this will have to be negotiated going forward. These two knowns are likely to have impacts in terms of business restructuring.
The UK will no longer need to abide by EU labour standards. Although, it must be recognised that at the end of the Brexit transition period on 31st December 2020, existing EU law was converted into domestic law.
It also needs to be recognised that if the UK seeks to diverge too far from the prevailing EU standards, it is likely to gain what the EU would consider an unfair advantage in terms of the Single Market, and the EU has reserved the right to take retaliatory action, which could include applying tariffs. This could then act as a break on UK aspirations in terms of changes to labour standards.
