13 February 2017 | Martin Read
Three Brexit issues emerge as being particularly germane from an FM perspective; contract law, access to European facilities contracts, and staffing. Martin Read reports.
When Britain voted to leave the European Union there was no immediate indication of what it would mean for the country’s facilities management providers. Seven months later, the uncertainty remains – but there is gathering clarity to the agenda.
Last month, the prime minister set out her 12 objectives for the negotiations ahead. Then, following a Supreme Court ruling, the government introduced its ‘strikingly brief’ bill designed to trigger Article 50 by March.
Three issues emerge as being particularly germane from an FM perspective; contract law, access to European facilities contracts, and staffing. In the longer term, beyond the parameters of the next two years of negotiation, the European laws set to be bulk-absorbed back into British law (“the great repeal bill”) will be pored over by newly empowered British lawmakers seeking to distinguish this country from the rest of Europe through its lighter regulation of business.
“Although the government’s vision and intent was outlined in January, it’s fair to say that for many at the coalface questions remain unanswered,” said Peter Brogan, the BIFM’s research and information manager.
“What is clear is the need to look at the strengths of the FM market in a changing business environment, considering the challenges and opportunities that potential new legislation will bring.
“To that end there’s a workstream being developed by our International Special Interest Group and R&I team.”
But the most immediate impact remains the make-up of the labour force during and post-Brexit.
“Limiting migrants from the EU could have a significant impact on the FM industry as there is a shortage of particular skills in the UK,” said Julian Fris, director of FM consultancy Neller Davies.
Peter Cheese, CEO of the Chartered Institute for Professional Development, welcomed the clarity to business resulting from the prime minister’s January speech – particularly her confirmation that protections afforded to workers through current employment legislation would continue.
“Many EU-derived regulations provide vital workplace protections and workers up and down the country will be reassured by the news that their rights will not be sacrificed as part of any deal.”
And while it was clear that the government wanted to control its borders “it should still be possible to design a flexible, managed immigration system that allows businesses to access the skilled and unskilled labour they need from both EU and non-EU countries”.
But Cheese said there was disappointment that the prime minister was unable to confirm that EU nationals already residing in the UK will be allowed to stay. “This needs to be an immediate priority in the negotiations to come.”
Nikki Dallas, the founder and MD of recruitment consultancy Talent FM, thought the PM’s vision of looking to the wider world and being a truly global Britain beyond the confines of the EU “will create a fascinating opportunity for FMs to manage portfolios wider than the normal EMEA experience, which tends to be the usual focus”.
“I predict that we will see higher demand for Asia-Pacific experience, with senior FM professionals educating themselves on FM and H&S legislation beyond the EU to take advantage of new opportunities.”
Dallas also believes Brexit will see the current skills shortage, particularly in engineering and facilities services roles, exacerbated further as the war for talent gets fiercer and UK becomes a less attractive place to work.
Accordingly, Dallas said the quality of the workplace will become increasingly important as a recruitment tool. The value of real estate and FM as a tool to entice workers will increase – putting more pressure on FMs to deliver.
Ian Thomas of caterers Bartlett Mitchell pointed out that EU workers currently fill a large proportion of roles in catering.
“While there are only around 5 per cent of EU workers taking up roles in building services, there are approximately 50 per cent working in soft services. This could present a significant future challenge.
“There is much talk about developing permit schemes for EU migrants which could prioritise certain sectors. We believe it is crucial that catering and the wider FM sector is one of those sectors that government must prioritise.”
“The PM sounds like she’s resetting the dial back to the organisation’s original intention to act as a Common Market for trade,” said Julian Fris. “If successful, the EU can become a sensible trading area for the UK while leaving options open to work with those who sit outside of it.
“Most EU legislation is already passed into UK law, so the industry will not see an immediate impact,” said Fris. “It will be difficult to disentangle completely and may take a generation; our industry will need to carefully manoeuvre its way though over the coming years.”
For Bartlett Mitchell’s Ian Thomas, the impact of Brexit on the supply chain is top of mind.
“Leaving the single market could mean higher increased costs on large FM capex projects where plant or equipment needs to be purchased from EU countries.”
But “this does create opportunity for UK producers and potentially see a regeneration of UK-based equipment manufacturers”, he said.
Of more immediate concern to Thomas from a catering perspective is the impact on food prices as a result of the weakening currency.
Overall, the prime minister’s announcement was the first step in what is likely to be a very long journey. But there is confidence beyond the current lack of detail.
“There will undoubtedly be some significant challenges in the coming years,” said Ian Thomas. “It’ll be up to us in the FM sector to find innovative ways to mitigate the challenges and ways to exploit the opportunities. We’ve been here before and we will adapt.”
Julian Fris agreed. “The UK FM industry is a world leader, and, while there will be some bumps in the road, I don’t expect that this will change.”