Following the agreement of the guidelines by European Union (EU) ministers, the EU’s negotiating stance for the transition period has been revealed. The transition period, or implementation period, first set out by Prime Minister May in her Florence speech will allow a set amount of time for the UK and the EU to continue negotiations whilst avoiding a “cliff-edge” exit from the Union. The EU’s guidelines set out a maximum transition period of 21 months, from the end of March 2019 to 31 December 2020.
The new guidelines state all EU rules and regulations will apply to the UK from exit during the transition period. This confirms the right of freedom of movement will continue to apply, meaning EU citizens will be free to move to, and work in, the UK during this transitional period. In addition, the UK would continue to have access to the single market for the whole of the transition period; an issue which is seen as imperative by the government.
Agreeing to these guidelines for the transitional period will increase security for those larger organisations currently profiting from the single market. Continued free market access will ensure these organisations are able to operate as normal during the transition process, in terms of trade and staff, whilst also giving them a sufficient period to plan ahead for a post-Brexit Britain.
However, critics of the guidelines argue this does nothing but further confuse the situation for those whose workforce currently contains a significant proportion of EU citizens. Should the proposal be agreed, it is argued organisations will be left in a state of uncertainty about future movement of workers.
In the document ‘Safeguarding the position of EU citizens living in the UK and UK nationals living in the EU’, the government originally indicated EU citizens would have freedom of movement until 29 March 2019. It granted EU nationals with 5 years consecutive residency in the UK before the date of the exit the right to apply for a new ‘settled status’ allowing them to receive an official residence document. Those whose residency did not meet the required 5 year threshold would be granted temporary status and allowed to remain in the UK with the intention of building up sufficient residency to eventually apply for the ‘settled status’. It will remain to be seen how future rules will apply to the issue of immigration following extended freedom of movement during the transition period.
Currently, these guidelines set out the EU’s starting stance for the transition period before any negotiation takes place between the parties. Organisations will need to consider how these guidelines will impact their workforce, particularly those in sectors which will be heavily affected. Whilst freedom of movement during the transitional period will allow a continued employment of EU workers in the short-term, without setting in place contingency plans, these organisations may face a workforce shortage in the future.