Written by Janthana Kaenprakhamroy – Founder, Tapoly
The ongoing uncertainty about Brexit poses challenges to every sector of the UK economy.
Across the board, employers and workers feel that their fears have not yet been addressed, and many senior figures in British industry have warned of disastrous consequences if the final Brexit deal does not accommodate the needs of workers and businesses.
Freelancers and contractors are at greater risk than most. The gig economy thrives on frictionless convenience and interconnectedness. It works best when individual workers and small businesses can operate in large marketplaces without needing the bureaucratic or operational support that only larger organisations can provide.
At the same time, the gig economy has been a central plank in the UK’s sluggish recovery from recession. Almost all of the growth in employment since 2008 comes from workers seizing opportunities to work for themselves, and over half the growth in self-employment since 2008 has been in the form of people taking on part-time gigs. Self-employment in Britain is currently at the highest level since records began.
Whether you’re a freelancer, you work with contractors, or your business depends on the thriving of the gig economy, it’s important to start thinking about how each of the possible Brexits might affect you.
The most obvious impact of Brexit on workers in the gig economy is likely to be a drastic reduction in the ease with which workers can take on contracts abroad. Although travel between the UK and the EU is likely to remain relatively frictionless after Brexit, Britons will almost certainly need to obtain a visa before they can work in any EU country. Obtaining a work visa is nearly always a time-consuming process, and often an expensive one. It will no longer be possible for contractors to take on work in Europe at very short notice, and administrative costs will impact freelancers’ bottom lines. On the upside, freelancers who work remotely with EU clients will be better shielded from the impact of Brexit than some employed workers.
However, it’s not just the loss of frictionless movement that threatens to impact gig workers. At the moment, industry regulations are set at the European level, so anyone accredited to do business in the UK can do business throughout the EU. Under the Prime Minister’s plan for a “common rulebook” with the EU, this synchronisation of standards would probably be preserved in most sectors. However, in the event of a “harder” or no-deal Brexit, British businesses might need to obtain accreditation or qualifications recognised in the EU countries where they wish to do business. This may prove an unsustainable cost even to some large businesses: for the self-employed it could prove disastrous.