Blog: What impact will putting Britain first have on the UK hospitality industry?

Louise McCosh

Louise McCosh

French Duncan HR Services Director, Louise McCosh, looks to what lays ahead for the hospitality and leisure sector in post-Brexit Britain

 

As Brexit negotiations continue to dominate the headlines, the hospitality and leisure sector wait with baited breath as to how these talks will impact their labour supply.

The overall impact of Brexit on UK immigration remains unclear, but regardless of what is agreed hospitality leaders are only too aware that a shortage of staff is inevitable.

What has the government indicated to date?

The government have heavily indicated that any EU Nationals who have lived in Britain for 5 years will have a “settled status”, and that this will be a new form of indefinite leave to remain, so any employees within this category, for the time being, will not be affected. However those with less than five years will have to apply for continued residency and this may be a cause of concern for hospitality leaders.

So far the government have also failed to outline any regulations around those who are yet to enter the UK as the free movement debate is still a major sticking point for the EU States and formed a major part of the Leave Campaign. This has unfortunately resulted in a great deal of uncertainty for the industry as we rely so much on EU nationals to fill our positions both seasonally and annually.

‘Top Secret’ Home Office plans

In September, a highly sensitive Home Office document was leaked to the Guardian. Whilst the plans set out were only a draft, yet to be reviewed or approved by Ministers, it did serve as a telling insight into the immigration strategy for after we have left Europe. The document set out that in the days following Brexit, free movement as we know it will come to an end, for all but the highest skilled workers with the intention of Britain reducing net migration to “sustainable levels” and “taking back control” of its borders.

The 82-page document made for grim reading – in brief, the restrictions include:

• Potential numeral caps on those working in lower skilled jobs;
• A maximum of two years residence for low skilled workers;
• A requirement on EU nationals to register 3 to 6 months after arrival for a biometric residence permit; and
• Plans to introduce right to work checks for EU nationals to be carried out by the employer with criminal sanctions and fines if illegal workers are discovered.

Knock On Effect on Hospitality Industry

Following the Brexit vote, both hoteliers and restaurateurs have noticed a drop in migration, though this also may be correlated to the drop in the value of a pound following the vote. In a post-Brexit world if the above barriers are implemented for EU nationals, even if they are tamed down, the UK will quickly lose it’s appeal to these individuals.

The hospitality and leisure sector rely on recruiting hundreds of thousands of workers each year to stem natural turnover. In the lead up to March 2019, we are likely to see increasing EU nationals leave the UK and a distinct lack of people migrating into the country – this will result in a rapid and severe labour shortage.

What Measures Can Be Taken? 

It is clear that the putting “Britain first” mentality will have a dramatic impact on both recruitment and retention in the hospitality and leisure industry, which is something we can ill afford when tourism is booming.

Hoteliers and restaurateurs should take steps now to stem the flow by:

• Encouraging EEA national workers and their family members who have been in the UK for five years or more to apply now for permanent residence – this should make applying for ‘settled status’ more streamlined;
• Encouraging EEA nationals who have been in the UK less than 5 years to seek advice;
• Ensure offers and contractual employment terms are conditional on an individual having the right to work in the UK;
• Consider how you can support EU nationals entering the UK. In 2019, it could be that you will need a sponsor’s license from the Home Office to sponsor EU nationals under a tier 2 points based system – apply now to avoid a rush once plans become clearer: and
• Plan ahead as to how you will monitor and manage right to work checks – HR software will be crucial to keep track of expiry dates and document compliance.

We are currently facing a great deal of uncertainty moving forward and this can be an alarming time for the hospitality industry but there are steps we can take to ensure we are as prepared as possible for March 2019, and ensure that regardless of the legislation that is implemented, we will be ready for it.

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