The development of employment law tends to be a reactive process in the United Kingdom. In a number of other jurisdictions in Europe and beyond there is a tradition of civil codes and prospective thinking, each concerned with planning for how things should be, rather than reacting to how they are. The common law tradition in the UK has meant law typically developed to address a particular mischief or event and that has informed and shaped the development of legislation. It is not to say that either of these approaches is better than the other; I can leave that to the politicians and legal philosophers to debate.

What this means is that we can look at things currently bubbling away as issues now and predict what effect, if any, these may have on the development of employment law over the coming months or years. For example, the desire to have a more flexible workforce and to drive down labour costs led to the creation of zero hours contracts, which then became widely used/abused (take your pick), which led to pressure from unions and workers for change, which led to the Government to take some action. (Whether one thinks it went far enough is not the point.)

Economics tends to be what drives change in employment law (new legislation and/or the way in which courts interpret and apply the law), whether it is the need or desire on the part of employers for reduced costs, or for higher income or job security on the part of employees and households. A good starting point is to look at the latest UK Labour Market bulletin from the Office for National Statistics.

This shows that 26.83 million people are in employment; 4.79 million people are self-employed; 1.65 million people are unemployed and 19 million people are economically inactive (neither in work nor seeking/available for work). Of that 19 million, the majority are over 65 and presumably retired. Wage growth over the past year has been 2.3%, with average weekly pay (excluding bonuses) being £474 (surprisingly close to the cap on weekly pay for redundancy and the basic award).

Underneath these figures are trends that show a number of things: the growth in self-employment; the increasing number of over 65s in work; and the decline in the economically inactive. This suggests that the pool of people available for work is increasing. Even if one assumed a ‘hard Brexit’, with a relatively small number of EU citizens retaining the right to work in the UK, that would reduce the number in the pool by around 2 million (about 90% of the EU citizens in work in the UK). Given the UK’s relative lack of productivity and low-wage growth, this suggests a high proportion of lower-skilled, service jobs, more easily filled by those older or previously economically inactive.

In turn that will produce only slight upward pressure on wages in employment. Self-employment earnings are lower now than they were in 1994-95. Therefore pressure will not come from the labour market for change – for example, shortages of labour pushing up wages or high trade union membership improving conditions – but from workers on the Government and the courts to protect their position. With employment tribunal fees remaining relatively high, together with higher employment depressing numbers, any changes will be Government-led.

The agenda on Brexit will be such that employment law change will be low down the list or viewed as too difficult (employment status) or contentious (removing EU-related rights). This suggests no expansion of employee rights, rather the maintenance of the status quo. An economic crisis, however, may be the event or mischief that provokes more fundamental change, but that would most likely be a contraction of rights in an effort to be perceived as more ‘employer-friendly’.

Alex Lock, DAC Beachcroft LLP