Contracting in the EU? Keep calm and carry on

With Britain soon to enter a two-year process to officially leave the EU, contractors face a period of uncertainty because the finer details about British non-EU citizens temporarily working in member states are yet to be drawn up, writes Matt Walters of overseas contracting advisory Capital Consulting.

Since Friday’s historic referendum result, there has been a lot of talk about the possible introduction of the so-called ‘Blue Card’ and whether this will be the key for UK contractors working in Europe, post-Brexit. We have indeed seen the successful application of the Blue Card as an EU-wide work permit that grants highly skilled non-EU workers the freedom to move around Europe without the delay of obtaining permits.

Business as Usual

It should be made clear that it’s understandable UK contractors are fearful of losing their automatic right to work within the EU, and it’s important that they question the potential outcomes of our exit from Europe, with a view to making preparations. But it’s important too that we don’t get ahead of ourselves. Keep in mind; for the next two years, Britain will be negotiating the terms of its exit under Article 50 with the UK remaining part of the EU throughout this period, meaning there will be no immediate change for contractors working in Europe.

This is good news for contractors. It means it is very unlikely that any sudden changes will be made by the UK or the EU, so any current contracts will remain unaffected, and any new contracts as well.

In fact, the only way UK contractors operating in Europe would significantly be impacted by the Brexit result is if the UK placed a block on ‘freedom of movement,’ which would be a wholly uncharacteristic move for the current government. Also, if the UK decides to move to a points-based immigration system like that of Australia, it may be more difficult for workers to secure contracts in Europe.

Home and Away

An even more creditable expectation at this stage is that we will see fluctuations and instability in the labour market, brought on by businesses coming to terms with what the ‘Leave’ result means for them. Contract work-seekers might not be immune to this turbulence. But they are far better positioned than permanent job-seekers, who end-users were already shying away from on the eve of the referendum, as uncertainty crept in and made committing to workers on a full-time basis less appealing.

There is another upside we foresee for temporary, contract professionals. Thanks to the prospect of UK-based clients relocating to European economic powerhouses such as Germany, the Netherlands or Switzerland (due to the potential trading issues leaving the EU may bring), the contractor market that has up until now primarily served the UK will continue to thrive elsewhere. So rather than contracting opportunities simply evaporating, we will likely see a shift towards more international opportunities being available. This will afford contractors who want to work overseas a flexibility that they may not have previously enjoyed.

Mainstream doom-mongers

It's for these reasons that we don’t share the grim outlook that some of the mainstream press have, including -- interestingly -- the publications which were pro-Leave. However, these media titles are not addressing highly skilled contractors -- for whom the overseas market for their skills and services is as resilient and flexible as it is specialist. Some of the speculation that can be seen in national newspapers will no doubt lead to confusion about how business, employment and finances are going to be affected by Britain’s exit from the EU.

But like most of the contractors we’ve come across since the vote, we prefer to listen; remain informed but ‘keep calm and carry on’ serving our clients, and review once new facts emerge. The Blue Card is a case in point. Whether or not it is introduced for UK contractors depends on the deal the UK strikes with the EU and, while we encourage contractors to keep abreast of potential outcomes of the deal, it is far too early to predict what the full effects of the Brexit will be on UK contractors’ prospects in the EU. It really is a case of ‘business as usual’ until the coming months tell us otherwise.

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Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
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