Brexit and Global Mobility: keeping abreast of the changes

07 July 2016

By Ben Wilkins, UK Global Mobility Partner

With the dust still far from settling after the UK's decision to leave the European Union and a prevailing sense of uncertainty among both employers and employees, what actions should Global Mobility professionals be considering as businesses begin to focus on dealing with the realities the UK’s vote to leave the EU?

Communications and employee engagement

Employers will recognise the fractured state of opinion on this highly emotive issue.  People have entirely differing perceptions of the pros, cons and implications of Brexit - for themselves, their business, the economy and society more generally. Reduced workforce confidence and productivity will be a significant factor during such uncertainty - with people 'sitting tight' until there is clarity.  Could some key UK talent be considering opportunities overseas, during this uncertain period?

Action: Developing a strong communications and engagement strategy will be vital, both to sensitively set the tone for a respectful debate focussed on the future and to maintain employee confidence and engagement.  The Global Mobility function’s proximity to employees working across EU borders gives it a key role in shaping and delivering the appropriate messages and maintaining engagement with those most immediately affected.

Assessing the implications for business strategy

A full assessment won’t be possible until the terms of the UK’s new trading relationship with the EU are known. Some organisations affected by current market turbulence will need to take decisive action now, notwithstanding the uncertainties about the future. Business leaders will be looking to get their hands on facts, data and certainty during this period of ambiguity.

Global Mobility is well placed to obtain the citizenship and demographic data necessary to determine the business’ reliance upon overseas talent and UK nationals working within EU operations. It will be able to lead the debate on talent - who is working where, where is  our key talent, what roles are they in, what competencies do they have?  Data on areas such as these will help inform employers' discussions with industry bodies and government representatives negotiating the UK’s future trading arrangements with the EU.

Action: Global Mobility should obtain relevant data to help business leaders focus their impact assessments on these higher risk areas of the business.

Understanding the cost drivers of the globally mobile population, as well as the return on that investment, will enable Global Mobility to help business leaders make the right long-term strategic decisions.

Action: Global Mobility should consider scenario-planning to provide a rapid assessment of how particular workforces, employment structures, projects or business areas are affected by potential changes in immigration requirements, labour laws, social security costs and exchange rates.  Should there be a need to relocate groups of employees, planning is needed to consider the best and most appropriate approaches and policies for these moves - with the aim of creating a win-win situation for the business and the people it needs to move.

Operational readiness

EU citizens who rely upon the EU’s freedom of movement will be concerned about their future.

Action: Global Mobility should be prepared to answer the inevitable, practical questions about what action employees need to take to secure their ability to continue to work in the UK or within the EU.

Some employers may consider redeployments of talent out of the UK if their review of the business environment indicates a positive outcome from doing so. These undertakings are complex and require significant planning.

Action: GM will need to engage early with multiple parties, both internally and externally, to ensure a realistic and executable plan is developed. 

Experience from the financial crisis of 2008/9 shows us that significant market volatility often causes businesses to react by focussing on cost reduction.  The same era saw enormous growth in short term business travel, as those in front office, sales, marketing and client-facing roles continued to develop market opportunities through any means possible.  In contrast with expat assignments, short term business travel was widely perceived to be less costly and more flexible.  In reality, this is not always the case.  The OECD’s Base Erosion and Profit Shifting (BEPS) will increase the business risks associated with ungoverned business travel.  And if the UK’s post-Brexit EU trading arrangements do not include free movement of labour, the risks will increase further.

Action: Many Global Mobility functions are under significant pressure to take responsibility for short term mobility governance.  Brexit is only likely to further increase the pressure.  Therefore, engaging with leadership now to put forward the business case for a governance and risk mitigation framework in this space will pay dividends in the longer term.

Summary

Proactive and early engagement with business leaders will enable Global Mobility to demonstrate that it is a strategic enabler during times of such unprecedented volatility and change. Bringing data and insights on areas such as the demographics of mobile workers, immigration status and cost scenario planning can bring much-needed clarity to inform and shape the debate.

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