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Brexit Webinar Series 3


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Employment Data Protection And Transfers

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Brexit Webinar Series 3

  1. 1. © Allen & Overy 2016 Employment, data protection, and data transfers Sarah Henchoz, Charlotte Mullarkey and Sarah Garvey November 1, 2016 Brexit Webinar Series Presented in partnership with the U.S. Chamber of Commerce
  2. 2. © Allen & Overy 2016 22 Brexit webinar series 2016 – Programme Agenda 1 Brexit: Understanding the context and consequences of the UK referendum vote Tuesday, 18 October 2016 2 Trade, tariffs, and taxes Tuesday, 25 October 2016 3 Employment, data protection, and data transfers Tuesday, 1 November 2016 4 Antitrust, intellectual property, and environmental regulations Tuesday, 8 November 2016 5 Commercial contracts Tuesday, 15 November 2016 6 Securing the best legal framework for your businesses Thursday, 17 November 2016
  3. 3. © Allen & Overy 2016 3 Employment
  4. 4. © Allen & Overy 2016 4 Where we are now Nothing has changed yet UK must serve formal notice to withdraw from EU – expected to happen by end March 2017 Notice will trigger 2-year exit negotiation period (which may be extended) Purpose is to agree terms of UK’s withdrawal from, and future relationship with, EU UK will exit when an agreement is reached or (if no agreement) at end of 2-year period (in first quarter 2019) EU laws/free movement rights continue to apply until point of exit BUT Article 50 litigation may affect this process and timeline
  5. 5. © Allen & Overy 2016 5 Brexit raises inevitable employment concerns
  6. 6. © Allen & Overy 2016 6 But it is still business as usual for employers No short-term employment law changes expected No immediate action is required Wait and see how things develop But plan ahead to be prepared
  7. 7. © Allen & Overy 2016 77 Speak to the business and to employees Secure an HR place on your in-house Brexit team Engage with employees to reassure them (if appropriate) – Consider what you can say in light of what is known – Individual v collective communication – Form of communication (face-to-face, e-mail, FAQ documents) There may be separate legal duties to inform/ consult employee reps/employees
  8. 8. © Allen & Overy 2016 88 Check who you have where − When do they end or how can they be terminated? − Has repatriation been promised and, if so, is there a home country job to return to? − Risk exposure in event of early termination? Audit your European expatriate workforce Review UK-inbound and outbound expatriate arrangements Check workers’ current immigration status Reconsider/delay pending arrangements if in doubt Include workers in (and from) EEA Member States and Switzerland
  9. 9. © Allen & Overy 2016 99 Take steps to secure workers’ immigration status The shape of future immigration policy is uncertain Proposed points-based immigration system apparently rejected Work permit system is an option being considered Consider bringing workers to the UK now Encourage those who are eligible to apply for permanent residence Applying for citizenship may also be an option for some Possible exemptions for European bankers and highly-skilled businessmen/women System will be reciprocal (i.e. corresponding UK/EU and EU/UK controls)
  10. 10. © Allen & Overy 2016 1010 Anticipate skills and service gaps − Relocation of business − Downsizing of business − Reorganisation/efficiency changes Possible business model changes Possible employee implications − Relocation of jobs/repatriation of workers − Redundancies − Cost-saving/efficiency measures − Changes to terms and conditions − Recruitment to fill gaps − Incentivising key employees to retain them
  11. 11. © Allen & Overy 2016 1111 EU law is likely to remain influential in the longer term Unravelling EU rules from UK legislation is likely to be a long and politically-fuelled process Rights may be contractual – employee consent may be necessary to change/remove them ECJ rulings are already embedded in UK case law Government may be reluctant to change some EU law-derived rights anyway UK likely to have to keep similar employment law standards to maintain strong EU trading relations
  12. 12. © Allen & Overy 2016 1212 What else does the PM have in mind? “…we’re going to have not just consumers represented on company boards, but employees as well.” “… I want to make shareholder votes on corporate pay not just advisory but binding. I want to see more transparency, including the full disclosure of bonus targets and the publication of “pay multiple” data: that is, the ratio between the CEO’s pay and the average company worker’s pay.” Theresa May, 11 July 2016
  13. 13. © Allen & Overy 2016 13 Data Protection and data transfers
  14. 14. © Allen & Overy 2016 1414 Data Protection - At a glance There is no immediate change to either UK (or European) data protection laws as a result of the UK referendum result Based on the current timetable, the GDPR will apply for a period before the UK’s formal exit from the EU Until we know how Brexit is approached many questions will remain unanswered… It is expected the UK will adopt a data protection law which is the same as (or very close to) the GDPR, to ensure the UK is considered “adequate” for the purposes of data exports from the EU (or less likely join the EEA )
  15. 15. © Allen & Overy 2016 1515 What is the immediate impact of Brexit? C No impact on data exports outside EU/UK UK data protection law continues to apply No impact on data transfers within UK/EU Article 29 Working Party Opinions still apply Court of Justice of the EU decisions still apply (e.g. Google Spain) ICO continues as UK data protection regulator – ICO guidance still applies
  16. 16. © Allen & Overy 2016 1616 Will the EU’s General Data Protection Regulation still apply from 2018? EU General Data Protection Regulation will apply from 25 May 2018 The UK’s exit from the UK is expected to take two years from the start of the process We don’t expect that process to start until end March 2017 although timings may change It seems the GDPR may apply for a period before the UK’s exit
  17. 17. © Allen & Overy 2016 1717 Will the EU’s General Data Protection Regulation still apply from 2018? – The General Data Protection Regulation, the EU’s new data protection law, is a Regulation – this means it will be directly applicable in the UK for so long as the UK remains part of the EU. From the date of the UK’s exit from the EU, the GDPR will no longer apply in the UK, unless the UK – joins the EEA; or – enacts a law similar to the GDPR into UK law. GDPR will not apply within the UK, unless… – The Data Protection Act 1998 is a UK Act of Parliament, not an EU law – It implements an EU Directive (Directive 95/46/EC) – The Data Protection Act 1998 will continue to apply unless and until repealed by the UK Parliament
  18. 18. © Allen & Overy 2016 1818 Are there any circumstances in which UK businesses will be subject to the GDPR? Offering goods and services into the EU GDPR applies (extra-territorial effect) Monitoring behaviour of data subjects in the EU
  19. 19. © Allen & Overy 2016 1919 What does this mean in terms of GDPR implementation across a multinational business? – GDPR applies to any controller or processor: – with an establishment in an EU Member State; and – which is processing personal data in the context of the activities of that establishment, regardless of whether that processing takes place within the EU or not – For multinationals with establishments across both the UK and EU member states, this means the GDPR will still apply to those establishments. – In the UK, good practice and ICO guidance is already aligned with requirements which are formalised in the GDPR – It is likely to make sense to continue to plan to apply the GDPR across both the UK and EU. GDPR will apply to a business established within EU
  20. 20. © Allen & Overy 2016 2020 What will be the status of cross-border data transfers between the EU and the UK? European data protection laws restrict the transfer of personal data to “third countries” outside the EU/EEA Unless it joins the EEA, the UK will become a “third country” and transfers of personal data to the UK will be restricted Free flow of personal data is critical to trade
  21. 21. © Allen & Overy 2016 2121 What options are open to the UK to avoid restrictions on transfers of personal data to the UK? Member State EEA state Seek adequate status Adequate countries: Andorra, Argentina Canada, Faroe Islands Guernsey, Isle of Man Israel, Jersey New Zealand Switzerland, Uruguay US Privacy Shield? EEA countries: Norway Lichtenstein Iceland Model contracts Consent Other derogations
  22. 22. © Allen & Overy 2016 2222 What would the UK need to do to achieve “adequate” status for the purposes of data transfers? Adequacy – at discretion of the European Commission CJEU in Schrems Adequacy = equivalence GDPR (art. 45) Take account of rule of law, data protection rules, effective data subject rights, cross-border transfer rules, effective authorities, etc. Directive (art. 25) Takes account of all circumstances, including rules of law, professional rules and security measures The bar has been raised over time Is the UK likely to be considered adequate given the UK’s surveillance laws?
  23. 23. © Allen & Overy 2016 2323 Latest statements from the UK government and ICO “…We will be members of the EU in 2018 and therefore it would be expected and quite normal for us to opt into the GDPR and then look later at how best we might be able to help British business with data protection while maintaining high levels of protection for members of the public..” The Secretary of State Karen Bradley MP “I acknowledge that there may still be questions about how the GDPR would work on the UK leaving the EU but this should not distract from the important task of compliance with GDPR by 2018. We’ll be working with government to stay at the centre of these conversations about the long term future of UK data protection law and to provide our advice and counsel where appropriate.” Elizabeth Denham, UK Information Commissioner, 31 October 2016
  24. 24. © Allen & Overy 2016 2424 Brexit webinar series 2016 – Programme Agenda 1 Brexit: Understanding the context and consequences of the UK referendum vote Tuesday, 18 October 2016 2 Trade, tariffs, and taxes Tuesday, 25 October 2016 3 Employment, data protection, and data transfers Tuesday, 1 November 2016 4 Antitrust, intellectual property, and environmental regulations Tuesday, 8 November 2016 5 Commercial contracts Tuesday, 15 November 2016 6 Securing the best legal framework for your businesses Thursday, 17 November 2016
  25. 25. © Allen & Overy 2016 2525 Contacts Sarah Henchoz Partner Employment – London Tel +44 20 3088 4810 Sarah has considerable experience advising clients on the full range of both contentious and non- contentious employment matters. She regularly advises clients on the complex and sensitive issues arising out of the acquisition of a business and the harmonisation of that business into the wider corporate structure both locally and cross border. This involves advising on implementing new service agreements and benefit packages for senior executives, employee and trade union consultation, and post-completion integration. Sarah also regularly appears in and advises clients on Employment Tribunal matters, particularly in the areas of discrimination and whistleblowing, and in respect of bonus claims. She also has significant experience of managing cross-border projects Sarah is also a regular contributor to employment journals and is frequently quoted in the press most recently being interviewed on BBC London News in relation to the Brexit vote.
  26. 26. © Allen & Overy 2016 2626 Contacts Charlotte Mullarkey PSL Counsel Corporate – London Tel +44 203 088 2404 Charlotte is a PSL Counsel in Allen & Overy's London TMT group. She has significant experience in, amongst other things, arrangements for the exploitation of intellectual property, issues relating to data protection and cyber security, outsourcing and procurement transactions, IT/technology law, and system build and integration agreements. Charlotte assists the commercial/outsourcing group with complex research, training (internal and external) and legal know-how support on transactions. She is a regular speaker on the data protection conference and roundtable circuit with particular expertise in the GDPR. She writes many articles and blogs on data protection issues and is currently one of the four IAPP London KnowledgeNet Chairs.
  27. 27. © Allen & Overy 2016 27 Contacts Sarah Garvey Counsel Litigation – London Tel +44 (0)20 3088 3710 Sarah is an experienced litigator with particular expertise in conflict of laws, state immunity issues and EU laws. She regularly advises clients on topics such as governing law, jurisdiction, immunity and arbitration. Sarah is part of Allen & Overy's core Brexit team and has been heavily involved in advising clients on the legal implications of Brexit. Sarah is Chair of the Law Society's EU Committee and sits on the Lord Chancellor's Advisory Committee on Private International Law. Sarah edits the Forum Chapter of Butterworths' Encyclopaedia of Banking and is secretary to Allen & Overy's Global Legal Opinions Committee. Sarah is a Board Member of the London Women's Forum.
  28. 28. © Allen & Overy 2016 Contacts 28 Marjorie Chorlins Vice President, European Affairs +1 202-463-5305 Garrett Workman Director, European Affairs +1 202-463-5639 The U.S. Chamber of Commerce's European Affairs team champions a pro-business agenda across Europe and in Washington to expand commercial opportunities for members by advancing open and competitive markets, economic growth, and transatlantic cooperation.
  29. 29. © Allen & Overy 2016 2929 Questions? These are presentation slides only. The information within these slides does not constitute definitive advice and should not be used as the basis for giving definitive advice without checking the primary sources. Allen & Overy means Allen & Overy LLP and/or its affiliated undertakings. The term partner is used to refer to a member of Allen & Overy LLP or an employee or consultant with equivalent standing and qualifications or an individual with equivalent status in one of Allen & Overy LLP’s affiliated undertakings.