Working Time, Agency Workers and TUPE: Employment law implications of the EU Retained Rights Bill

Under the government proposals, all “Retained EU Law” (ie secondary legislation implementing EU Regulations or Directives and CJEU case law) must be expressly transferred into UK law by 31 December 2023 or it will cease to be law in the UK. There is the option to extend this deadline to 23 June 2026 (the 10 year anniversary of the Brexit vote).

In addition, the Bill gives ministers power to amend any retained EU law with little parliamentary scrutiny before it is incorporated into UK law. UK higher courts will also be able to disregard case law which was decided or influenced by EU law. Primary legislation (such as the Equality Act, for example) will not be affected by this Bill.

Just last week, the Bill was given by the House of Commons, but is expected to run into significant opposition when it heads to the House of Lords for further scrutiny, and will likely be a political point of contention during 2023.

Implications for Employment Law

It should be reemphasised that we do not know what form the final Bill will take, how the government will approach any particular piece of legislation, or indeed how the EU might respond. Nevertheless, the Bill has the potential to give ministers extraordinarily wide powers over many laws currently affecting employment rights. 

While this has the potential to impact many familiar pieces of employment legislation (including laws relating to part-time workers, fixed-term employees and health and safety at work), at this stage it appears the ones most likely to be changed are:

• The Working Time Regulations (“WTR”) 1998
  
  Working time has frequently been the subject of gripes by the Conservative Party (which opposed it from the start), and so the WTR seems most at risk of reform.
  
  While there may be some in government wishing to see wholesale change, it is unlikely the government will have the strength or support to significantly curtail worker protections, such as the right to paid annual leave. It is more likely to focus on "quick wins", one of the main ones being to remove the unpopular 48 hour maximum working week. There may also be a move to undo the impact of EU case law on the WTR, including on holiday pay calculations and accrual of holiday entitlement on sick leave. For more on how the WTR may change, see our earlier blog on the WTR post-Brexit.
• TUPE (Transfer of Undertakings (Protection of Employment) Regulations 2006)
  
  In brief, TUPE ensures continuity of employment and terms and conditions for affected employees on a business transfer or service provision change. The government is unlikely to want to remove TUPE protections altogether, but it might seek to make them more "business friendly", for example, by relaxing the consultation provisions or allowing some harmonisation of terms and conditions post-transfer.
• Agency Worker Regulations
  
  The aim of the Agency Worker Regulations is to give agency workers basic employment conditions equal to those recruited directly by the employer. The regulations have never been popular and are frequently criticised as complex and unnecessary "red tape". It is highly likely that they will be significantly curtailed or repealed in their entirety.

To meet the 31 December 2023 deadline, this year could well be one of rapid legislative change combined with considerable uncertainty. You can keep up to date with particular aspects of Retained EU Law through the Public Dashboard here. 

With many thanks to Alex Evans, a current paralegal in our employment team, for co-authoring this blog.

If you require further information about anything covered in this blog, please contact Amy Wren or your usual contact at the firm on +44 (0)20 3375 7000.

This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.

© Farrer & Co LLP, January 2023