U.S. Business after Brexit: Prepare, stay alert

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By Alexandra LaCombe

 

The nervous tailspin U.S. business leaders are experiencing as a result of Brexit is not likely to settle anytime soon, especially due to the human psychology of fear of the unknown. The reality, however, is there are some things we know will occur, and we can prepare now to minimize negative impact.

 While the exact reason United Kingdom voted to exit the European Union is likely to be debated throughout history, the term “freedom” was touted as a leading factor.  Freedom from deep integration with the rest of the EU, freedom for Britain to make its ‘own’ decisions regarding economics, and freedom to change its own immigration laws are among the key issues.  However, with the approval of Brexit, these freedoms will soon become restricted and will have tremendous impact on employers, especially the freedom for employees to easily relocate for work between the U.K. and the rest of the European Union.

While the world begins to feel and understand the economic aftershocks stemming from U.K. voters’ decision, U.S. corporations do not have to feel completely helpless waiting for details to unfold. Corporate America needs to prepare as best as possible knowing the separation of the U.K. from the EU will include changes such as: 

  • A registration plan may be established between the UK and EU to prove lawful status of EU Nationals who are in the U.K. This will replace the current free-travel arrangement between the EU’s 27 participating countries and the U.K. 
  • The current points based system in the UK which regulates immigrant workers on different tiers such as entrepreneurs, investors, artists, engineers, midwives, skilled labor and students, for example, will most likely be replaced with an Australian-style system that has more rigid lines. For example, unless an individual is either a documented and U.K. approved refugee, sponsored by an employer to fill a job, or approved from a specified list of skilled professions, chances of relocating to the UK may be nil.  (It will not apply to Irish nationals because of Ireland’s strong relationship with the U.K.)

American companies that have offices in the U.K. are likely to wonder whether they should start looking to relocate into an EU country. If they employ staff from the EU, these companies need to prepare for delays and increased costs that will occur from increased red tape that will result from Brexit.

On another side, Great Britain, during this turmoil, may look even further to its friendship with the U.S. for guidance and will not want to upset its relations with U.S. business leaders who have strong impact on their economy. Keeping calm and being alert regarding possible upcoming changes will only serve to benefit U.S. businesses.

If you need assistance with this, or any other immigration issue, please contact the author, Alexandra LaCombe, at (248) 649-5404 or alacombe@fragomen.com. Alexandra  is a Member of the Legal Affairs Committee of Detroit SHRM and a partner at Fragomen Worldwide (a Resource Partner of Detroit SHRM).

Detroit SHRM encourages members to share these articles with others, inside and outside their organization, as long as its name and logo, and the author’s information, is included in the re-post of the article. July 2016.