24 June 2016 Insurance

Brexit will lead to redundancies as financial services firms relocate

A number of business leaders have already warned that the UK’s exit from the European Union (EU) will likely lead to large scale redundancies in the financial services sector.

Nick Elwell-Sutton, partner at Clyde & Co, said that he believes that while little will happen in the short term, the long term consequences could be severe with many large financial services businesses likely to relocate to within the EU.

“In the immediate short term nothing changes – it is business as usual. However employers will need to consider how they will be affected once the exit actually occurs,” he said.

“Watering down of employment rights is unlikely to be an immediate government priority, however revoking freedom of movement means the ability to recruit skilled EU nationals which is currently taken for granted would be curtailed and they would be subject to whatever immigration and work permit rules then apply.”

He added: “At a more fundamental level, unless the financial services passporting rules are resolved in the UK's favour, then many large financial services businesses are likely to relocate to within the EU meaning large scale redundancies would be highly probable."

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