CLV Partners


Workforce 2020 – London

16th Annual Managing an Internation Workforce: 2020 Beyond
In February Lewis Silkin held its annual conference „Managing an International Workforce: 2020 Beyond” in London. The 16th annual conference gathered HR professionals, in house lawyers and labour lawyers from several counties. CLVPARTNERS was represented by Henrietta Hanyu and Éva Fülöp labour lawyers. Many actual and interesting topics was discussed like “Using self-employed contractors – hidden employees. From work protection perspective the mental health issues gets more emphases and in many countries relevant laws have been adopted and the employers in the process of forming their internal policies, so Hungary should also be prepared.

Of course there was a hot topic the Brexit impact on the Immigration, what changes will EU and UK face , but at the end of the day the conclusion was that there are and will be lots of uncertainty.

Actual topic was also how the the populism effects the labour law – here was mentioned Poland and Hungary but finally it was clear that the topic was very complex and no unambiguous conclusion might be made.

GPDR after Brexit – Data transfers outside the EU

After years of negotiations the United Kingdom has officially left the European Union, therefore the UK has become a “third country”. We would like to take this opportunity to point out the special rules concerning the UK and data transfers outside the EU in general.
Data transfer to the UK

As we have noted in our latest article on Brexit, some changes need time to enter into force. According to the withdrawal agreement concluded between the UK and the EU, there will be a transition period until 31 December 2020. In this transition period, the GDPR is still applicable in the UK, so the UK would not be considered as a third country until the end of this year.

What happens after the transition period?

It is very important to note that any data processed before the end of the transition period shall continue to be processed in accordance with the GDPR. Thus, personal data transferred to the UK during the transition period shall be guaranteed the same level of safety as currently provided by the GDPR and data subjects have no cause to worry about their right to privacy.

After the transition period, the UK and the EU still need to iron out the specifics of data protection. Certainly, for most data controllers that would be most convenient if the UK continued to apply the GDPR.

However, in the event of a “no-deal” Brexit or if the “deal” excludes data protection, the rules of transferring data outside the EU would have to be applied to the UK.

Data transfers outside the EU

One of the most emphasized general rule of the GDPR is that transferring data outside the EU is not allowed only with a very few exceptions. There are three categories of these exceptions, “adequacy decisions” in Article 45, “appropriate safeguards” in Article 46 and “derogations for specific situations” in Article 49.

Adequacy decisions

With regards to Brexit, the second best scenario would be an EU Commission adequacy decision. Data may be transferred without any special rules or authorizations to third countries deemed to provide an adequate level of data protection. While the decision falls to the discretion of the Commission, we expect this to be a very likely outcome, as the UK has high standards of data protection in their national legislation.

Appropriate safeguards

Should the UK not be found adequate, the next option is for the data controller or processor to provide appropriate safeguards. These safeguards are subject to the approval/ adoption of the Commission and/or the supervisory authority. The most relevant of these safeguards are as follows:

• binding corporate rules (BCR) of a corporate group (approved by the supervisory authority);
• standard data protection clauses (adopted by the Commission);
• standard data protection clauses (adopted by a supervisory authority and approved by the Commission);
• an approved code of conduct together with binding and enforceable commitments of the controller or processor in the third country to apply the appropriate safeguards, including as regards data subjects’ rights;
• an approved certification mechanism together with binding and enforceable commitments of the controller or processor in the third country to apply the appropriate safeguards, including as regards data subjects’ rights.

The abovementioned options require either significant effort from the data controller (i.e. drafting BCRs or codes of conduct) or a proactive supervisory authority (i.e. drafting and adopting standard clauses). Since the GDPR’s entry into force, no standard clauses have been adopted yet. Consequently, most data controllers might find appropriate safeguards a barrier too high to entry.

Derogations for specific situations

The last option is derogations for specific situations, to be applied for exceptional cases and will not serve as legal basis for systematic or regular transferring of personal data. The most relevant of these situations are as follows:

• explicit consent of a data subject informed of the risks of transfer to the third country;
• transfer is necessary for the performance of a contract between the data subject and the data controller or a contract concluded in the interest of the data subject;
• transfer is necessary for the establishment, exercise or defence of legal claims;
• transfer is necessary in order to protect the vital interests of the data subject or of other persons, where the data subject is physically or legally incapable of giving consent.

In any event, if the data controller uses these derogations as basis for data transfer outside the EU, the transfer may only take place if it is not repetitive and concerns only a limited number of data subjects, in addition the controller must demonstrate a compelling legitimate interest and inform the supervisory authority as well as the data subject. This is considered the least favourable option for data controllers because of their obligations to inform.

The right of exit and of entry following Brexit

The United Kingdom is set to leave the European Union on 31 January 2020. As the date draws ever so close, it is time to get acquainted with the rules to follow the departure of the country, most importantly the right of exit and of entry of union citizens.
Presently, union citizens can enter the UK with both their national identity cards or their passports and they do not need a visa to do so. Although 31 January 2020 is the day the UK shall officially leave the EU, it will be followed by a transition period, in which the rules of entry and exit shall remain unchanged.

According to the agreement between the UK and the EU, this transition period ends on 31 December 2020. The Joint Committee (comprising representatives of the EU and UK) may extend this transition period one time with an additional 1 or 2 years. As a result, the current system could hold out as late as 2022, but for now 31 December 2020 shall be deemed the relevant date.

Come 1 January 2021, – assuming no extension takes place – it will be entirely up to the British Parliament to determine the conditions of entry and exit into the country, specifically whether or not a passport and/ or visa is required.

Legislative changes in Hungary anticipating a possible ‘No Deal’ Brexit

The proposal affects the right of residence, employment and entitlement to social security and unemployment benefits for British citizens in Hungary.

The Hungarian government has drafted a bill on 26 February 2019 titled “Amendments to certain laws in the event of the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union in a disorderly manner” under number T/4821. According to the explanatory memorandum to the bill, the likelihood of a disorderly exit has increased significantly, which means that on the midnight of 29 March 2019 the United Kingdom of Great Britain and Northern Ireland would become identical to third-countries. The amendments to the law contained in the bill would enter into force in Hungary at the time and in the event of a no deal Brexit.

As regards residence and employment, the essence of the bill is that British citizens can continue to hold the same status as an EU citizen for 3 years after leaving which means, they can legally reside and work in Hungary after leaving the EU in case their status is in order, i.e. they have a Registration Certificate for EEA Nationals or a Permanent Residence Card prior to the date of the exit. After leaving and staying for at least 3 years in Hungary, they can apply for a National Permanent Residence Permit without examining the terms and conditions applicable to housing, subsistence, health insurance and Hungary’s interest. After 5 years of uninterrupted stay in Hungary, British citizens may apply for EC residence permit as well. In the latter case, however, the examination of the residence conditions, unlike national residence permit, cannot be waived.

As it follows from the rules above, British citizens arriving in Hungary after Brexit will be entitled to reside and work under the rules applicable to third-country nationals.

The main principle for the various social security benefits is that the benefits determined before the UK’s exit remain the same.
In terms of pension rights, the periods of insurance completed both prior and past to Brexit are recognized and offset, as proposed in the bill.