Politicians and mobility industry confront labour movement uncertainty

Prime Minister David Cameron has told the heads of the other 27 European Union nations that fears in the UK over the free movement of labour and immigration were the main reasons there was a vote for a Brexit in the referendum.

overseas workers
As mobility professionals expressed concerns over the future of foreign assignments in Europe, Mr Cameron told reporters after attending what will probably be his last European summit in Brussels, "I think people recognised the strength of the economic case for staying, but there was a very great concern about the movement of people and immigration, and I think that is coupled with a concern about the issues of sovereignty and the absence of control there has been."I think we need to think about that – Europe needs to think about that and I think that is going to be one of the major tests for the next prime minister. It's a difficult challenge because the European Union sees the single market as one of goods, services, capital and people... (in Europe) these things go together, whereas in Britain we see them as separate options."Mr Cameron, who announced his resignation after the 52–48 per cent vote in favour of leaving the EU, made his comments after Chancellor Angela Merkel of Germany warned that the UK must accept free movement if it wanted to retain access to the single market after withdrawal from the bloc.The uncertainty over what happens over the free movement of labour – and what happens to UK expats currently working in the EU, and vice versa – is already causing headaches for mobility managers.Avrom Goldberg, from Florida-based Lexicon Relocation, says the Brexit vote has "sent shock waves around the world" and "leaves global mobility professionals, especially those with employees or business in the UK and other European countries, wondering what lies ahead".Mr Goldberg pointed out that, until Britain's disengagement from the bloc, EU citizens in the UK prior to the referendum would not lose the right to live and work there, while, similarly, British citizens in EU countries would not lose their right to live or work there.He added, "It is possible (but not certain) that EU citizens who commence work in the UK between now and the completion of disengagement will also acquire similar rights to remain in the UK after disengagement in completed. According to immigration experts BAL, it is also possible that those who have lived and worked in the UK for less than five years by the time disengagement is completed will need to apply for permits to continue living and working in the UK."Looking at the potential relocation of European company headquarters from the UK, Mr Goldberg said: "The UK is home to around 50 per cent of all headquarters of multinational corporations operating in the EU, so there is much potential for upheaval."The impact of potential European headquarters migration or transfer of operations out of the UK is greatest in London and in the global financial services sector. Banks based in London are reported to have already begun looking at shifting some operations outside of the UK. Frankfurt, Paris, Dublin and Amsterdam have all been mentioned as alternatives as banks consider moving staff from London to locations within the EU."This potential impact is not confined to financial services. In the immediate aftermath of the referendum result, companies in the technology sector (such as Samsung) are rumoured to be considering a move of their European headquarters out of the UK. Other tech sector companies such as LG Electronics and Acer are also looking at shifting operations. Acer CEO Jason Chen is on record as saying the UK's departure from the EU will weaken demand in the European market due to lower consumer confidence and exchange rate fluctuations."John Salt, group sales director at totaljobs, added, “In the wake of the EU Referendum, and the political, economic and social chaos that has ensued, it’s important that HR professionals, or anyone who looks after recruitment and HR issues, maintains a steady and pragmatic approach.“Totaljobs pre-referendum research found that 87 per cent of Europeans living in the UK were worried about the impact of a Brexit vote, with 49 per cent fearing for their job security. With the UK’s economic health in doubt, and with many companies warning of potential job losses, businesses should be looking to reassure all of their employees, whether Europeans or UK nationals, of their job security, wherever these assurances can be guaranteed."This will be particularly important in industries such as travel and banking, which have been hit especially hard. Employers should now be doing all they can to keep up to date with legislation changes as negotiations progress, and communicate any changes transparently to their employees.”

Read analysis of what the vote to leave the EU may mean for for the global mobility industry in Brexit is a reality – a new era for global mobility? by Relocate Global's managing editor, Fiona Murchie.

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