The Employment Lawyers Association (ELA): Brexit - Court of Justice of the European Union (‘CJEU’): View of employment lawyers

Date:
Thursday, February 21, 2019
Topics:

The purpose of this paper is to provide some background information and explain the impact of EU law and the CJEU upon key areas of employment law.

Summary

  • The CJEU currently performs two clear roles – it is the arbiter of disputes brought by or against the UK Government and, more importantly in this context, it provides guidance on the application of EU law to domestic courts and tribunals who seek such guidance.
  • After the UK leaves the EU, UK courts may have regard to CJEU case law but will not be bound by it.
  • ELA has concerns particularly about cases in train at Brexit date, as well as concerns about how courts and tribunals will interpret/rely upon CJEU case law after the UK exits the EU. 
  • In addition, ELA has a number of concerns about the practicalities of implementing the Government’s current proposal to ensure that UK ‘workers rights’ keep pace with those of EU workers. 
  • Without the government accepting and introducing legislation that makes it clear that, at least in relation to ‘workers rights’ (which will need to be defined), the UK will be bound by CJEU case law, the Government will not be able to ensure UK ‘workers rights’ keep pace with those of EU workers.
  • There is a real prospect of divergence between UK law and EU law, and of a weakening of the application of CJEU jurisprudence, leading to a diminution of workers’ rights. 

Analysis

The subject of the ongoing role of the CJEU is a significant, if politically vexed one.  This paper examines the practical concerns of employment lawyers raised by the current uncertainty and the potential impact of loss of CJEU oversight.

The CJEU performs two clear roles:
1) as an arbiter of disputes brought by or against the UK;
2) in practice, more importantly, an interpretative function, providing guidance on the application of EU law to domestic courts and tribunals which have sought guidance by making a ‘reference’ to the CJEU.

The stated UK position is that leaving the EU will mean the end of the jurisdiction of the CJEU in the UK.  On the face of it this is a clear cut position.  The implications are, however, more complex than might first appear.

UK Courts ‘may have regard to’ the case law of the CJEU after the date upon which the UK leaves the EU (‘Brexit Day’) but will not be bound by post-Brexit Day decisions.  It is anticipated that UK domestic courts will approach the disapplication of existing CJEU case law (for instance should divergence start to occur) in the same way as they are obliged to when departing from the decisions of domestic courts.

There have been a number of seminal employment law cases where the guidance of the CJEU has been particularly significant, for instance, Lock v British Gas Trading Limited which dealt with the application of the Working Time Directive 2003/88/EC to holiday pay calculations, or Dekker v Stichting  simplifying the tests that a woman complaining of pregnancy discrimination needs to satisfy, or Enderby v Frenchay Health Authority requiring the employer in an equal pay claim to prove that there was a genuine material factor other than sex to explain significant statistical differences in pay between two groups comprised mostly of different genders.  The loss of such guidance will have a significant impact upon UK employment law and inevitably raises the prospect of divergence between domestic UK law and EU law and the weakening of the applicability of CJEU jurisprudence as a result in the UK.  Divergence will raise the real prospect of diminution of worker rights, which runs counter to the Government’s stated aim of ‘no rollback’ of workers’ rights. The above cases demonstrate that CJEU jurisprudence has often, though not always, interpreted Directives in favour of workers bringing claims.

Implications and challenges ahead

Practical issues will arise from the loss of the role of the CJEU as an arbiter of disputes by or against the UK.  We set out below five main concerns. 

1)  Cases in train seeking a reference from the CJEU;
2)  Cases in train concerning disputes brought by or against the UK;
3)  
Cases not yet in train that would have ultimately come before the CJEU;
4)  
Concerns about the interpretation/reliance upon CJEU decisions after Brexit Day;
5)  Concerns about the current proposal to guarantee UK workers that their rights will keep pace with those of European workers. 

1) Cases in train seeking a reference from the CJEU

Perhaps of greatest significance will be the loss of the preliminary reference mechanism. These will be referrals made by domestic courts and tribunals seeking guidance on the application of EU law.  By making the reference, the court or tribunal is indicating that they need guidance in order to be able to comply with their obligation to administer justice.  If such guidance is not available, then, whilst the court or tribunal will still be likely to reach a decision, it is arguable that such a decision will be deficient, or will be seen to be deficient, because of the fact that guidance was clearly required but not supplied. 

2) Cases in train concerning disputes brought by or against the UK

In the absence of an agreed passage of transition there may be disputes and cases in train which have not yet been determined at the point of Brexit.  If post-Brexit Day decisions are not intended to bind the UK, this may raise concerns about, for example, a denial of justice and remedy to those with cases in train, and concerns about costs where money and time has been spent on action where the parties involved had a reasonable expectation that the CJEU would be the ultimate arbiter of the dispute, but where the matter ultimately ends up being determined domestically.   Particularly in cases where a party reasonably anticipated a particular outcome from the CJEU, which is not the outcome ultimately provided by the domestic court, this seems to cut across the principle of justice being seen to be done.

3) Cases not yet in train that would have ultimately been before the CJEU had they been pursued earlier

Whilst of less significance, for those cases that would have been subject to the scrutiny and jurisdiction of the CJEU, or those where a reference would have been sought, particularly those pursued just shortly after Brexit Day, there may also be a sense that justice has not been seen to be done because a different outcome might perhaps have been reached had the case been pursued just a short time earlier. 

4) Interpretation/reliance upon CJEU decisions post Brexit Day

As we have seen, the House of Lords proposed an amendment to the European Union (Withdrawal) Bill (as it then was) to change the emphasis of the provision dealing with the regard that courts and tribunals are to have to CJEU decisions post Brexit Day.  It had previously been expressed such that a UK Court ‘need not have regard’ to such decisions but could do so if the court considered it appropriate to do so.  It has now been changed, in accordance with the House of Lords’ suggestion, so that UK courts ‘may have regard’ to such decisions so far as it is relevant to any matter before the court.   The reason for seeking the amendment concerned the very negative press attention placed on the High Court judges who ruled on the Miller litigation (R (Miller) v Secretary of State for Exiting the EU) that included their being referred to as ‘Enemies of the People’.  The amendment shifts the emphasis such that it is now expressly permissive of a court having regard to such case law, which is a helpful start, but it is likely that judicial concerns have not been fully alleviated in this regard and that courts feel obliged to give fuller explanations of why regard has been given to a particular piece of CJEU case-law as opposed to a situation where regard has not been so given. 

5) Current proposal to guarantee that UK workers’ rights will keep pace with EU Workers

In February 2019, it was reported that the Prime Minister was proposing to introduce a draft Bill guaranteeing that UK workers’ rights will keep pace with those in Europe.  It is very unclear how this would in fact work in practice. Specifically, how this would apply given the status being afforded to CJEU case law post Brexit Day.  There has been talk of a common rulebook between the EU and the UK, but it is not clear how this might work – it is unlikely that the UK would sign up ‘carte blanche’ such that it would agree to implement legislation equivalent to all and any EU legislation introduced in the future affecting workers.  It is also unclear how CJEU case law that affects workers’ rights would be incorporated given that such case law will not be binding post Brexit Day.

The above raises a fundamental issue for the government. Without the government accepting and introducing legislation that makes it clear that, at least in relation to ‘workers rights’ (which will need to be defined), the UK will be bound by CJEU case law, the Government will not be able to ensure UK ‘workers rights’ keep pace with those of EU workers. There may need to be some form of Ministerial certification that regard would be had to CJEU/EU law in the framing of any new legislation, which could be policed by means of judicial review.

Further Information

Press enquiries: ela@elaweb.org.uk
The Employment Lawyers Association (‘ELA’) is an a-political group of approximately 6,000 UK employment law specialists, including in house employment lawyers, trade union lawyers and private practice lawyers who advise employers and employees, and represent clients in Courts and Employment Tribunals.  ELA does not lobby on behalf of third parties or comment on the political merits of proposed legislation.  However, we are happy to offer legal and practical insight gained from our experience as employment lawyers.  ELA’s Legislative and Policy Committee includes Barristers and Solicitors who meet regularly for a number of purposes, including to consider and respond to proposed new legislation.  A sub-committee has been set up by ELA’s Legislative and Policy Committee to review and comment on issues arising from Brexit.

ELA remains ready and willing to assist those who will formulate policies, debate and draft employment legislation by providing a-political insight and practical commentary where we consider that would be helpful.

The legal content in this article is believed to be correct and true on this date.