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Members of the United Kingdom’s Conservative Party have elected Boris Johnson to be the country’s new Prime Minister. Johnson handily defeated Foreign Secretary Jeremy Hunt, winning over 60% of the vote. This election comes after Prime Minister Theresa May announced her resignation in May. Known for his hardline pro-Brexit stance, Johnson becomes Prime Minister with the UK’s October 31st deadline to leave the EU rapidly approaching. While Johnson believes he can reach a better deal with the EU than those that have been put forth, he has already stated that the October deadline is “do or die” and will be adhered to—and that he supports a no-deal Brexit if a new deal cannot be reached.
How This Will Impact Mobility
Johnson’s handling of Brexit in the next few weeks will have a tremendous impact on the mobility industry. Already the prospect of Brexit has led companies to rethink business strategies and begin relocating employees from the UK to a different EU member state to minimize disruption. A no-deal Brexit could end UK citizens’ right to free movement in the EU immediately, and possibly require UK nationals in the EU and EU nationals in the UK to apply for work permits. Leaving the EU without a deal would disrupt supply chains, lead to delays in the movement of goods and services in and out of the UK, and create even more uncertainty for the mobility industry.
EU leaders have remained firm and consistently stated that they will not renegotiate a new Brexit deal regardless of the Prime Minister election outcome. At this point it is hard to imagine a scenario where Johnson could negotiate a better deal than his predecessor. The UK Parliament has shown reluctance to leave without a deal, but as it stands, the UK will leave the EU on October 31st without any changes to the current law. The UK Parliament took votes last week to attempt to prevent Johnson from circumventing Parliament on his way to a no-deal Brexit. Johnson’s relationship with Parliament will be a key factor to monitor going forward.
A no-deal Brexit would mean that there would be no transition period to ease the UK’s exit from the EU. Many companies had been planning on transition time to maintain stability while the UK and EU worked to define their future relationship, and absent such a transition period, the mobility industry would have no time to adjust to massive changes in immigration processes. The election of Mr. Johnson greatly increases the chance of a no-deal Brexit and makes it even more critical for companies to know the exact location and immigration status of their employees.
Even with a new leader, uncertainty regarding Brexit is still pronounced. Several of Prime Minister May’s cabinet officials have already resigned in the wake of Johnson’s election over disagreement on how to best handle Brexit. Opposition Leader Jeremy Corbyn is pushing for a general election, arguing that the country, not the Conservative Party, should oversee selecting the new Prime Minister. A new general election would add another wrinkle to an already tenuous situation.
Though the challenges of a no-deal Brexit are discernable and worrying, much can change between now and October. Worldwide ERC® will be monitoring and reporting updates on Brexit as they arise.