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Scottish independence – analysing the impact on HR and employment law

There is less than a year to go until the Referendum in Scotland which will establish whether Scotland will remain part of the UK.

One area which has not been given much attention in the press is how this will affect HR issues in the workplace. Whether your business is focussed solely in one of the jurisdictions within the UK, or whether it is national and crosses borders, the result of an independent Scotland could have far reaching consequences for business, workers and the HR functions which must manage any changes in employment laws.

As part of the UK,Scotland is also part of the European Union. EU laws shape and govern the interpretation and enactment of employment laws and regulations in the UK. It would seem that an independent Scotland will not automatically gain entry into the European Union; it will have to apply in its own right. It is possible that there will be a period of uncertainty as to whether or not Scotland will gain entry into Europe. This will inevitably have an impact on personnel planning.

Whether or not Scotland is admitted to the EU, it will have to develop its own laws on employment as this is something which is not currently devolved to the Scottish Government.  It seems unlikely that an independent Scottish Government would attempt to reinvent the wheel, but rather, majoritively adopt the existing UK laws with some appropriate tweaks to deal with more local issues and Scottish business aspirations.

Gaining entry to the EU will be an important aim for an independent Scotland given that this will protect economic and trade links with other countries. As such, notwithstanding the potential for significant changes within Scotland in respect of the protections and rules which govern workers, it is unlikely that Scotland will seek to make any significant departures from the current employment laws. To do so could create uncertainty for businesses and employees alike, and any significant changes could ultimately result in the decreased prospect of entry to the EU. The pre-referendum uncertainty inevitably has an impact on business planning.  Ironically, uncertainty is currently the only certain impact of the referendum.

While Scottish Courts may put a different interpretation on certain employment issues from the rest of the UK(a situation which already exists) the fact is that as part of the larger EU, the essence of many of the employment laws would be the same.

Scotland is bound to seek to ensure that it is protected as far as possible from an economic perspective and any changes which are made will inevitably be designed to ensure that businesses find Scotland an attractive base. For any business with a UK wide operation, having to seek to apply different laws in Scotland from the rest of the UK would cause difficulty for HR functions. Proper planning is essential.

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Legal news, views, trends and tools for HR Professionals. Stay ahead. Go further