Employing EU nationals in the UK

When it comes to employing European Union (EU) citizens, consider the following:

• Do you employ any EU citizens in the United Kingdom (UK)?
• Do you plan to employ EU citizens in the UK in the future?
• Will your EU national employees remain in the UK after Brexit? Have you discussed their plans with them?
• Does your business rely on critical, skilled team members who are from the EU, and if so, how would the business cope without them?
• Have you informed your EU employees of their right to remain in the UK after Brexit?
• Are you giving your EU national employees the support and reassurance they may need at this uncertain time?
• Are your EU employees aware of the registration process for gaining settled status in the UK (see Chapter 7)?
• Is your workforce prepared for a no-deal Brexit? If there’s no transition period, the timeline for registering for settled status may be impacted.
• If your EU national employees choose to return to Europe, do you have the potential to recruit replacements easily?
• Have you checked out the government’s EU settlement scheme toolkit for employers? Find it at www.gov.uk/government/publications/eu-settlement-scheme-employer-toolkit.

Confusion and misunderstandings can be costly in terms of employee satisfaction and retention. Always keep your employees in the loop on Brexit developments and resulting changes in the business.

Maintaining access to labor

Depending on your business and industry, you may have some concerns about maintaining ongoing access to workers from the EU after Brexit. Read on for key questions to ask yourself at this time, and remember to circle back to Chapter 7 for more information.

• Is there sufficient labor available in the local domestic market to replace EU national employees returning to their home countries?
• How will you stay up to date on the latest UK government immigration plans and rules post-Brexit?
• Under the government’s immigration plans, unskilled workers from the EU will have the right to work in the UK for 12 months without getting a visa. Can you take advantage of this scheme to fill short-term and seasonal vacancies?
• After Brexit, skilled workers from the EU will no longer have easier access to the UK jobs market than skilled workers from elsewhere in the world, and they may have to earn a minimum salary (which has been suggested at £30,000). Are you aware of immigration rules for recruiting skilled workers after Brexit?
• Will it be harder and more costly to recruit in your industry after Brexit?
• Have you planned for the potential impact on employment costs post-Brexit?
• Will you have to offer higher salaries to recruit EU workers, if vacancies can’t be filled by UK nationals?
• If the company is planning to expand, have you considered your future workforce requirements and where you might be able to find suitable candidates?

Sending UK citizen employees to the EU

Your UK-national employees may need to travel to Europe on business. If so, consider the following:

• Do any of your UK-based staff need to travel in the EU on business?
• Have you considered changes in travel plans after Brexit?
• Are you aware of the plans for short-term, visa-free travel in the EU after Brexit?
• UK citizens looking to drive in Europe may need an international driving permit and insurance Green Card (especially in the event of a no-deal Brexit). Are your employees aware of this?
• Do you have sufficient health insurance for UK employees traveling in Europe?
• Do you have sufficient travel insurance (including air travel) for travel between the UK and EU?
• Does each of your UK citizen employees traveling to Europe have a passport that’s valid for at least six months after his or her stay?
• If you have UK citizen employees based in Europe for the longer-term, will they need to re-register for residency in the country in which they’re working?
• How might any employee rights for UK citizens based in the EU be affected by a no-deal Brexit?
• Have you considered taking on EU employees for EU-based roles, rather than sending UK employees to Europe, to ensure ease of movement across the EU?
• If you have an EU-based subsidiary company or branch, will you continue to maintain that presence after Brexit? Is it cheaper and easier to outsource operations to a third-party provider in Europe instead of maintaining your own European presence?

Other employment-related issues

Here are some other employment-related questions you may want to consider:

• How will you stay up to date on any changes in employment law after Brexit?
• Do your employment contracts need updating in line with legal changes post-Brexit? (Read more about contracts in general in Chapter 8.)
• Even UK-born employees may be concerned about their jobs in light of Brexit. Are you communicating with all your employees about changes in the company and how employees may be affected?
• How will you manage any disruption, low morale, and problematic behavior that may arise amidst Brexit uncertainty?
• Employees crave greater recognition in times of business change or uncertainty. Are you giving your employees the recognition and reassurance they deserve?
• Do your employees have a forum in which to ask their Brexit-related questions?
• Does the company have a clear anti-discrimination policy, and are you prepared to nip any workforce friction in the bud?
• Are you closely monitoring employee engagement?

General trade barriers and opportunities

What sort of trade barriers might your company face after Brexit? The following questions will help you assess the potential impact. You can find more information on trade barriers and trade agreements in Chapter 5.

• Will you still be able to trade your goods within Europe after Brexit?
• Have you considered the fact that some of your EU customers may seek EU-based companies to provide goods or services going forward?
• Is your particular industry likely to face much stricter checks on products coming and going between the UK and EU?
• If new tariffs come into force, how will they affect your business?
• Will your products still be competitively priced if new tariffs come into force?
• Will changing tariff structures make it more attractive to import goods from non-EU markets?
• Are you aware of the relevant EU product classifications for tariffs?
• If you provide services to EU customers, will you have to get authorization from the country in which you’re operating to continue providing that service?
• Will barriers to trade between the UK and EU open up new markets within the UK for your business? For example, will more UK consumers in your sector be looking for homegrown solutions?
• How will you stay up to date on trade negotiations between the UK and EU, and the potential impact on your business?

Importing and exporting goods

If you import or export goods to or from the EU, you may want to consider the following sorts of questions. Head back to Chapter 5 to read more about the potential impact of Brexit on importing and exporting.

• Does your business import or export goods to or from the EU?
• If so, are you aware of the potential changes in procedures regarding importing and exporting between the UK and the EU?
• Are you aware of any additional paperwork needed for goods that are being imported and exported?
• Have you considered employing specialist staff, or partnering with a third party, to help with import/export documentation and changing procedures?
• Is there scope to open an office in the EU or partner with an EU provider to assist with importing and exporting?
• Can your current software packages cope with changes in importing/exporting procedures and paperwork?
• Are you up to date on the government’s latest plans for the new Customs Declaration System for UK importers and exporters (see Chapter 6)?
• Do your employees have the information they need to carry out their import- and export-related duties correctly?
• Do you need to get proof of origin on components and products coming from the EU in order to complete your paper trail?
• Have you factored in the inevitable increase in importing and exporting costs going forward?
• Are you prepared for potential changes in value-added tax (VAT) payments and customs duties on imports from the EU?
• Have you considered working with a customs broker and/or customs warehouse provider?
• Is there scope to build any new tariffs into your current pricing structure?
• How will you stay up to date on the latest importing and exporting rules and procedures?
• Are you looking into potential new markets and suppliers beyond the EU, and assessing their individual import and export procedures?

Potential supply chain disruption

Any changes to import and export procedures, as outlined in the previous sections, may result in some disruption to your supply chain. Ask yourself the following impact assessment questions, and return to Chapter 6 for more information on potential supply chain and logistics impacts.

• Is any part of your supply chain dependent upon goods coming from the EU? (Remember: This will involve your suppliers and where they source their goods from.)
• Do you or any of your suppliers store goods in an EU-based warehouse? (Even if your goods originate from outside the EU, they may still temporarily be held in an EU warehouse.)
• Are you aware of the need for commercial trailers to be registered with the Driver and Vehicle Licensing Agency (DVLA) before traveling abroad?
• Are your drivers or transportation providers aware of the documents they need to carry for driving in Europe after Brexit?
• Have you considered potential time and cost implications of supply chain disruption?
• What is your contingency plan if goods are delayed exiting or entering the UK or EU?
• How will you manage customer or client expectations regarding short-term teething problems?
• Will you need to adjust customer expectations with regards to delivery times?
• How will you keep customers informed of post-Brexit changes?
• Do any of your contracts include penalties for late delivery?
• Do you need to update your standard terms and conditions to take account of supply chain changes?
• Have you spoken with your suppliers about any potential supply chain issues they may face, and how this may affect the service they provide for you?
• Are your suppliers making their own Brexit contingency plans? If they’re not, this could affect your business.
• Have you spoken with your transport/haulage providers about changes to procedures or timescales after Brexit?
• Are your haulage providers already facing a driver shortage and, if so, do they expect this to get worse after Brexit?
• Do you have a sufficient stockpile of components and stock to see you through any short-term teething problems, especially if there’s a no-deal Brexit? If not, are you able to stockpile critical components or goods? Can you afford to?
• Is your warehousing provider operating at capacity because of other companies stockpiling goods? Do you need to look for alternative or overflow warehousing space?
• Are your logistics suppliers planning to raise their prices in light of Brexit?
• Can you avoid supply chain delays by switching to other suppliers outside of the EU (either in the UK or further afield)?
• How might technology solutions help to mitigate supply chain disruption and make your supply chain more efficient in the future?

VAT, accounting, costs, and cash flow

As with any business change, you’ll no doubt want to discuss the impact of Brexit with your accountant and/or financial adviser. The following questions should serve as a good starting point for those discussions.

• Have you spoken with your accountant regarding potential cash flow issues?
• Do you have additional funding available to offset potential cash flow issues?
• Have you made plans to boost your profitability and reduce costs wherever possible?
• Are you able to extend payment terms with suppliers to mitigate cash flow issues?
• Is it possible to reduce the period of time between taking ownership of imported goods and receiving funds from the sale of those goods?
• Does your company hold money in EU institutions or regularly move money between the UK and the EU?
• The transfer of funds between the UK and the EU may need to be reported in a different way going forward. How will you stay abreast of changing obligations?
• Is your business VAT registered and how will you be affected by any changes in VAT rules?
• How will VAT or customs duties on imports impact your cash flow?
• Have you planned for a worst-case scenario regarding VAT and customs duties?
• Is there potential to offset potential VAT issues and customs duty increases with efficiency improvements in the business?
• Are there any other implications for your business in terms of accounting practices (such as double taxation rules)?
• Have you factored in the cost of seeking expert advice where needed? (See Chapter 10 for more on building a dream team of advisers.)
• Are there any business processes that you could automate or outsource to reduce costs? (See Chapter 11 for more business opportunities to take advantage of at this time.)

Talk to your accountant about potential cash flow issues in the wake of Brexit.

Grants and funding

Many businesses that benefit from government funding are concerned that Brexit may limit their access to funding in the future. Read on if this applies to your business.

• Is your business reliant on funding or grants that come from the EU? (This may include UK government grants that were backed by the EU.)
• If so, does the UK government plan to introduce similar grants and funding to replace those previously provided by the EU?
• Are there any new or existing domestic grants or funding programs you can apply for?
• Will your business still be viable if EU funding is removed and not replaced by the UK government?
• Is there a case for moving your operations to the EU to take advantage of EU grants and funding in the future?

Currency issues

Depending on your business model (for example, if you export goods to Europe), the weaker pound may bring positive business benefits. But how else might currency fluctuations impact your business? Read on to find out.

• Have you considered currency exchange issues?
• How will you monitor currency exchange issues going forward?
• Have you made plans for potentially offsetting volatility in the future, perhaps by hedging or negotiating a fixed sterling rate with EU suppliers?
• If your goods are more competitive and attractive to overseas customers as a result of the weaker pound, are you capitalizing on this? How can you increase your sales while the pound remains weak? (For more Brexit-related business opportunities, turn to Chapter 11.)

Professional qualifications and licensing

When it comes to professional qualifications, you may need to ask yourself the following sorts of questions:

• Will current UK professional qualifications or licenses be recognized in the EU going forward?
• Will those in the business need to seek EU qualifications to complement their UK ones?
• If any of your employees are moving between UK and EU subsidiaries, will they require additional qualifications or licensing?

Operating and product standards

UK businesses are used to operating in line with EU standards. But how might that change after Brexit? Check out the questions in this section. and read more about product and safety standards in Chapter 8.

• Does your company produce goods that must adhere to EU standards?
• Are any of your operations governed by EU standards?
• Are you aware of changes to UK standards in light of Brexit?
• Will your ongoing product safety standards be comparable with EU standards (essential for exporting to the EU)?
• Have you considered extra paperwork or certification that may be required to prove comparable safety standards?
• Do all the components you use in your products satisfy EU safety standards?
• Can you provide proof of origin for your products or components if needed?

Environmental standards

The UK government has committed to maintaining environmental protections, so little is expected to change for UK businesses in this regard. However, you may want to consider the following questions and circle back to Chapter 8 for more information on environmental standards:

• Are you aware of the government’s continuing commitment to environmental standards?
• Will you be abiding by EU recycling/waste regulations going forward?