What could Brexit mean for the travel sector?

As great uncertainty surrounds the future of Britain, it is likely that most tour operators will turn their attention to the influence that a Yes or No vote, on 23 June 2016, will have on the travel industry. In particular tour operators are likely to consider their position in relation to the Package Travel, Package Holiday, and Package Tours Regulations 1992, which have shaped the industry over the last 24 years, and their forthcoming replacement. As it stands, the new Package Travel Directive is due to come into effect, in the UK, by no later than 1 July 2018. However, a Brexit would mean the UK would not have to pass this legislation and could even repeal the 1992 regulations.

Doing so would significantly change the landscape for tour operators and remove consumer protection. Its conceivable obligations regarding a tour operator’s liabilities, responsibilities, and obligations with regards to financial protection would be removed.

In addition to the above, a Brexit could theoretically influence other areas within the travel industry which may impact upon tour operators and agents, for example:

  • Removal of rights of redress and compensation for delay and cancellation of flights;
  • Removal of the Consumer Rights Act;
  • Restrictions on consumer travel into the EU and access to healthcare;
  • From the prospective of being an employer:
    • Changes to working time regulations include the right to paid annual leave;
    • Restrictions on the ability to post workers aboard, such as overseas representatives;
    • Changes to TUPE and the rights of employers being transferred to another business when a business is sold;
    • Changes to discrimination rights and limits on compensation;
    • Changes to rights concerning family leave.

It is hard to imagine we would wake up and find we have no right to paid annual leave or parental leave, and it was now permissible to discriminate on the grounds sex, religion, or sexual orientation but it is something that we have to consider if a Brexit is approved.

In some areas, UK legislation predates EU regulations or extends EU derived rights further than is required; for example, in relation to annual leave, maternity rights, and rights concerning TUPE. It would therefore seem that tinkering with the existing legislation is a more likely to result in the case of a Brexit but great uncertainty will remain for businesses and consumers in such an event, possibly for several years afterwards. One thing is certain however, and that is regardless of the result the industry will face significant regulatory changes in the coming years.

Please contact Claire on Claire.Ingleby@mb-law.co.uk for further advice.

Please note this information is for general guidance only and is not intended to be a substitute for specific legal advice.

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