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Planning for Brexit's impact on EU labour in the retail sector

Written by
Fletcher Day
Date of Publication:
01 May 2019

At this point in time, it is arguably more reasonable than ever to work on the basis of "hope for the best, prepare for the worst", which, in this context, means, hope for a soft Brexit but prepare for the increasing likelihood (although not inevitability) of a hard Brexit.

In retail terms, a hard Brexit has the potential to be disruptive in two ways, one is by interrupting the supply of goods and the other is by interrupting the supply of labour. There have been quite a few articles about the former, but the latter could be equally important especially given that companies rely on EU workers for office-based roles as well as for shop-floor roles.

Office-based roles

The issue of office-based roles may actually be the one which is easiest to address - if retailers are ready, willing and prepared to be flexible. Assuming there is a hard Brexit, but all other relevant laws remain much as they are, then legally it is highly unlikely that there will be anything to stop companies retaining the EU employees they already have but changing the arrangement to one in which they work from a base overseas.

Obviously, there could be several practical challenges to be addressed before such an arrangement could be put in place and it may not be effective (either financially or practically) for every role, however, in the year 2019 there is typically less and less practical need for office-based "knowledge" workers to be based in a specific, physical location, so this option could be well worth considering, at least for your key employees.

Shop-floor roles

The silver lining in the Brexit cloud may be that it motivates retailers to look not just at what they do but at how they do it. In other words, when faced with the potential loss of EU workers, possibly your first question will be to determine whether or not you really need human workers, or at least the same number of human workers.

Small businesses may not think they have the resources to move to automated terminals, in fact, they may know for a fact they don't (and even if they do there may be reasons they do not want to), but there might still be ways to streamline processes to reduce the number of human workers required, for example, by the astute use of digital signage to guide customers round a shop and act as the first point of contact for customer service enquiries.

Once, these measures have been exhausted, the next step would be to see how to increase recruitment from people who already have the legal right to work in the UK. In this context, it will be interesting to see whether Brexit impacts the number of people who come to the UK from countries such as Australia and New Zealand.

On the one hand, the fact that a UK passport no longer confers the right to work across the EU may reduce enthusiasm, on the other hand, the fact that there will be less competition for jobs may encourage more to come and make the most of employment and travel opportunities. If this does not occur then there is still hope for retailers as the government has suggested that it will create a scheme to allow migrants from "low-risk" countries (not just the EEA) to come to the UK without a job offer and work for up to a year.