The Role of HRM: Brexit's Implications on UK and EU Workforce

This literature review examines the multifaceted impact of Brexit on human resource management (HRM) and the workforce within the UK and the EU. The review begins by introducing the context of Brexit, highlighting the significance of the EU workforce and the role of HRM in navigating post-Brexit challenges. It explores the debates surrounding immigration, its economic contributions, and the implications of restricted migration. The review then delves into the core concepts of HRM, including its evolution from personnel management, its dimensions (integration, quality, flexibility, and commitment), and the alignment of HRM strategies with business objectives. It emphasizes the importance of human capital and the objectives of HRM across organizational, functional, societal, and personal fronts. Various HRM theories are analyzed, including the strategic HRM approach and models by Karen Legge, Storey, and Ulrich, which describe the roles of HRM practitioners. The review discusses the implications of these models, highlighting the importance of teamwork, technology, and the evolving roles of HRM in addressing organizational issues. It concludes with a comprehensive overview of Brexit's expected negative consequences on the workforce within the UK and the EU.

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1LITERATURE REVIEW
1.0 Literature Review
1.1 Introduction
This section of the report provides a detailed analysis on the impact of BREXIT on
human resource management and workforce in both UK and EU workforce. The EU workforce
comprises of more than 20% labour force which implies that post BREXIT various companies
would face issues in managing their workforce effectively (Read and Fenge 2019). In this
scenario, human resource management play a significant role in supporting the smooth
operations of organisational processes in all the sectors. Even though, the majority of the
migrants are coming from non- EU states the membership of EU has always been perceived as a
migration issue. Immigration is a key problem in UK which can be considered as the reason
behind BREXIT. The debate arises from the immigrants comprising from the less developed
countries in the Eastern and Central Europe. Thomson (2019) states that many consider these
migrants as the reason behind high pressure in public services. On the contrary, Burdett and
Fenge (2018) stated that immigrants significantly contribute to the growth of the economy. These
immigrants are paying taxes as they are working in the country and they are compensating for
the ageing local population which is a major concern for the United Kingdom. However,
BREXIT has made the migration of people from other European countries to be limited. It
implies that the economic growth of the country would be significantly affected due to controlled
migration.
In light of this context, Bloom et al. (2019) stated that the principle of free movement
stated that movement of capital, goods, services and people are acceptable and immigrants have
the right to work in UK. Mohamed, Pärn and Edwards (2017) explained by stating that it is
possible for UK to control its borders so that the common of migration does not apply along with
asylum regulations. It is a fact that number of migrants from CEE countries have increased after
their inclusion into the European Union but still these migrants prefer working in Spain,
Germany, France and Italy (Esmail, Panagioti and Kontopantelis 2017). As stated by Sweet and
Smith (2017), majority of the immigrants prefer living in urban regions due to the job
opportunities and Mohamed, Pärn and Edwards (2017) supported the above statement by explain
the microeconomic determinants where shortage of human resources in developed countries has

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been considered as a prime reason for migration. Blunk, Benson Marshall and Cox (2020) stated
that there are multiple negative impacts of migrants from other countries within the EU which
has affected the job opportunities for the local people. On the contrary, Read and Fenge (2019)
stated that migrants had significant positive impact on the economy considering that they have
been integrated into the economy. However, UK’s exit from the EU is expected to have negative
consequences for the workforce working in EU and UK.
1.2 Human Resource Management
At the earlier stages of management studies, Brewster (2017) defined human resource
management as the concept of personnel management. However, Agolla (2018) argued that
human resource management is quite different from the concept of personnel management.
Agolla (2018) defined human resource management as the process concerned with the
administrative activities such as promotion, rewards, recruitment and motivation. Liu and Liao
(2017) formulated a detailed description of human resource management where it has been
considered as the clear approach of managing employees for achieving competitive advantage
through deployment of capable and committed workforce by using an array of personnel, cultural
and structural techniques. In contrast to this, Stachová, Stacho and Blštáková (2019) interpreted
human resource management as the design for coordinating organisational activities and
processes effectively. Therefore, it includes everything which is necessary to establish a good
relationship between the workforce and the firms. . Agolla (2018) postulated four dimensions of
human resource management which includes integration, quality, flexibility and commitment.
Therefore, employees are expected to identify the goals and interest of the organisation and align
themselves to stay committed and help the organisation in achieving those goals (Agolla 2018).
The employees are expected to the change based on the change in the organisational structure
without any strife and high quality of performance from the organisation depends on the
performance of the employees. On the other hand, the human resource strategies have to be
aligned with the business strategy.
Workforce has been considered as an asset in modern organisations and human capital
management is one of the type of practices in businesses. Human resources operate at the pivot
level within all operations as they are responsible for controlling, managing and guiding the
other assets in achieving the goals of the companies (Agolla 2018). Therefore, human resources

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are not considered as individuals rather they are defined based on their contribution towards the
goals and objectives of the organisation. Stachová, Stacho and Blštáková (2019) states that
human capital is the collective value of skills, knowledge, motivation and life experiences of the
workforce within an organisation. It is the representation of the intellectual capital within an
organisation which reflects upon the creativity, decision making and knowledge of the
organisation. Liu and Liao (2017) stated that the primary objective of human resource
management is to ensure that the organisation consists of willing and skilled workforce. Human
resource management has objectives at four fronts which includes organisational, functional,
societal and personal factors. The personal objective focuses on helping the employees in
achieving their personal goals as it enhances the individual contribution of the employees (Al-
Jahwari and Budhwar 2016). In terms of functional objectives, the human resource management
should provide resources based on the appropriate needs of various departments where optimal
resource strategy is a key. In terms of the organisational aspect, the human resource
management should focus on improving the effectiveness of the company (Brewster 2017). In
terms of the social objective, the human resource management ensures ethical and sustainable
practices for effectively contributing to the society.
1.3 HRM Theories
Brewster (2017) has defined strategic human resource management as planned human
resource activities and deployments for achieving the goals of the organisation. Modern studies
have emphasised on the concept of strategic human resource management where various bundles
of human resource practices are responsible for helping the organisations in achieving the
organisational goals. Haak-Saheem and Festing (2018) stated that a combination of human
resource practices are known as human resource systems. These practices are consistent
internally and are responsible for achieving organisational results. These systems are responsible
for determining the performance related outcomes within an organisation. Therefore, human
resource policies determine the intention of the organisation towards the workforce where the
human resource practices reflect upon the organisational values and beliefs. Brewster and
Hegewisch (2017) stated that human resource management are necessary for engaging the
employees and motivating them to perform to their fullest capabilities. In this respect,
organisation develop effective human resource practices to ensure higher retention rate as

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retention of skilled employees are necessary for developing a sustainable competitive advantage
in the market. Haak-Saheem and Festing (2018) suggested that organisations have used effective
human resource management practices are a mode of reducing their operational cost and increase
their organisational effectiveness. Over the decade various models have been proposed to
evaluate the human resource practices within organisations which are responsible for replacing
the concept of personnel management.
Karen Legge (1978) Model
As per the given model, human resource practitioners have been divided into three ways.
Conformist innovator is the first classification where the human resource practitioner uses the
objectives of the company to develop strategies for conflict resolution, cost reduction and
productivity increase (Brandl et al. 2015). It focuses on achieving the goals of the organisation.
The second classification is the Deviant Innovator are the human resource practitioners which
focuses to shift away from the objectives of the organisation and adopt professional stance
independently (Brandl et al. 2015). These recommendations provided by the practitioner are
unusual to status quo of the organisation and acceptance of these functions are dependent on the
status and position. Work life balance and employee development are key factors focused on by
the deviant practitioners (Venegas and Thill 2015). These ideas results in gathering competitive
advantage in the market. The final classification is Problem solver is a HR practitioner that
focuses on providing daily assistance to the management and can be considered as a problem
solver for the organisation.
Storey (1992) Model
The above model consists of grids where one axis determines the work undertaken and
the other axis determines the intervention of the human resource manager to the management
process.

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Figure 1: Human resource Intervention
Source: (Sikora and Ferris 2014)
Therefore, as per the model, the author considers the HR practitioners who are advisors
as the ones focusing on the strategic issues of the organisation but they do not implement the
recommended activities. On the other hand, Handmaidens are those HR practitioners that have
low amount of contribution to policy implementation but operate at the tactical front where they
deal with training and development, administration, provision of welfare, and recruitment
(Sikora and Ferris 2014). Similarly, the HR practitioners classified as the regulators are also
involved in tactical issues but they have high level of intervention in practice which ensures that
human resource policies are implemented by aligning them with the line managers. Last
classification in the grid consist of the change makers that are both focused on inventions and
strategies. These managers are less concerned with the administrative policies and these
managers focus on effective management of the workforce (Sikora and Ferris 2014). They assess
the needs of the organisations and develop strategies form achieving feasible conclusion. It
drives the changes within the organisation and make changes is a key to developing effective and
efficient human resource practices within the organisation.
Ulrich (1998) Model
The Ulrich model is similar to the model developed by Storey which described the role of
human resource practitioners within the organisation. However, there are slight differences

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between both the models. In the current model, the left side of the grid evaluates the degree of
management of organisational processes and people management on the other side of the grid
(Brandl et al. 2015). The change agents within the organisation focus on working from strategic
perspective where they monitor whether the employees are conforming with the change policies
or not along with effective implementation of goals, visions, policies and values (Venegas and
Thill 2015). The business partner segment of the human resource practitioners’ work closely
with the management to make sure that strategies are implemented by identifying areas where
strategies need to be implemented. These are basically remedial measures for the organisation
and the business partners solve problems and add real value to the organisation (Sikora and
Ferris 2014). The administrative experts within the organisation are focused on managing the
daily activities and processes to ensure that organisational policies on discipline, compensation
arrangements, equal opportunities and grievances are effectively implemented. They are
responsible for running the organisation so that the organisations can operate without any
barriers to organisational growth.
Figure 2: Role of Human resource
Source: (Brandl et al. 2015)
However, these model regarding the responsibilities and roles of a human resource practitioners
does not provide the overall picture. There are various contradictions with the model which
needs to be clarified. Team work has been emphasised in most of the models. Technology and
commitment has made team work as a key component for higher performance within the
organisation. It can be seen that group work is focused but in terms of pay and rewards they are

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rewarded individually which implies that employees may tend to ineffective and inefficient
within a group (Venegas and Thill 2015). In this models, human resource practitioners are
considered as advisors who guide the organisation through daily activities and processes. It is
difficult for human resource practitioners to develop their skills to provide accurate judgement
and advice to the organisation (Brandl et al. 2015). Various studies suggest that human resource
practitioners have struggled to keep the ethical practices and organisational values when greater
emphasis has been given on streamlining the standardisation. It means that organisation is forced
to move away from compliance practices such as employment equal opportunity, compensation,
grievance procedures and promotion.
1.4 Impact of BREXIT on UK and EU workforce
The economic integration consist of four freedoms which are internal to the market and
has been affected. These include free movement of goods, persons, services and capital. Read
and Fenge (2019) suggested that migrants had positive impact due to free capital movement
along with services and goods. Labour mobility was also a major factor making UK as attractive
destination from all migrants all over Europe. Burdett and Fenge (2018) stated that movement of
capital is one of the most negative impact of brexit which affect businesses which increases the
level of uncertainty. It would definitely affect the investments especially in case of the
multinational organisations which affects the long term growth of the EU economy. In this
respect, the human resource management faces significant challenges in managing their
workforce and fulfilling their need of skilled employees which are imperative to gaining
competitive advantage in the global market (Burdett and Fenge 2018). As per the economic
theory, production factor mobility ensure effective allocation of resources which is necessary for
improving welfare. Therefore migration problem affects the capital and labour mobility as these
policies are sensitive to the workforce. The endogenous growth theory suggests that a liberal
environment is necessary for gaining competitive advantage. In this respect, the human resource
practices face a significant challenges in developing effective policies to protect the rights of
their existing migrants from other EU nations (Fahy et al. 2017). In the recent years, UK has
experienced significant increase in migrants from other countries due to the lack of quality
workforce and aged population. Moreover, a significant proportion of the employees working in
UK are migrants which implies that hard brexit is expected to have more impact on companies

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operating in UK as they will have to develop strategies to ensure protection of their existing
workforce.
Thomson (2019) provided a strong point suggesting Brexit is essential for controlling the
migration from other countries as the net inward migration had increased exponential where the
country experienced inflow of more than 300,000 in the year of 2015. Mohamed, Pärn and
Edwards (2017) states that the perception of the common people in Britain is that uncontrolled
migration affects their jobs, wages and the overall quality of their life. The demand of
immigration reduction has come from this perception and majority suggested that immigration
has burdened the salaries, public services, cultural issues and unemployment. However, with
changes in policies the companies and public sector is expected to recruit and hire new talents
from within UK which is a problem as there is a significant lack of quality workforce
(Mohamed, Pärn and Edwards 2017). The EU immigrant provided opportunities to migrants
who are younger, more qualified and ready to work with fewer benefits. Fahy et al. (2017) states
that the Britain’s concern with higher competition, employment opportunities are also
significantly affected. However, migrants used goods and services which are ways of providing
job opportunities to the local communities. Blunk, Benson Marshall and Cox (2020) conducted a
study to examine the impact of immigration on jobs and wages of locals which showed that there
was no significant negative impact. Esmail, Panagioti and Kontopantelis (2017) conducted a
study to examine the impact of brexit and immigration policies on the GP workforce in UK
which showed that a large number of general practice workforce consists of migrants who have
been working longer hours and have been serving older and larger number of patients. Brexit
would result in loss of such workers and it would be difficult for UK administration to such
workers working more deprived areas with longer hours and larger patient numbers (Esmail,
Panagioti and Kontopantelis 2017).
Marangozov, Williams and Bevan (2016) suggest that post brexit there will be a reduced
supply of EU nurses which might have a significant impact on the nurses working in England as
the number of aging population is increasing as they are totally dependent on the workforce from
the EU countries. Therefore, in terms of health services, projected growth in population over the
age of 85 suggest an increase in demand for nurses with shortage of availability (Marangozov,
Williams and Bevan 2016). The human resources in such organisation will face difficulty in

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recruiting workforce keeping in mind the new rules and regulations. Therefore, NHS trusts are at
risk and these institutions face significant challenges in replacing their existing workforce with
equally skilled employees. Marangozov, Williams and Bevan (2016) states that nursing
workforce in NHS is a key issue as due to the cyclical nature of shortage of labour, there has
been significant increase in demand from EU nations. There is already shortage of nurses and
with the current ageing population of nurses the supply of nurses are way less in comparison to
the demand in the market.
Figure 2: percentage of nurses
Source: (Marangozov, Williams and Bevan 2016)
It implies that the current shortage along with Brexit is expected to leave NHS vulnerable
to lack of nurses where they would have significant difficulty in fulfilling the demand. Moreover,
it is not possible to rely on only home-grown nurses to mitigate the demand. Similarly, French,
(2018) suggested that the hospitality industry in the UK will be affected the most as the
hospitality industry consists of the majority of the migrant workforce. The labour survey of 2016
suggested that 24% of the workforce in the hospitality and the tourism industry are migrant
workers. Moreover, 45% of these workers are from EU countries which implies that there would
be significant shortage in workforce post brexit (French, 2018). Moreover, the turnover rate in
the hospitality is high and there is always a shortage of workforce due to the long working hours
and lack of work life balance. It implies that human resource managers within such companies

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are forced to develop new strategies for either hiring skilled workforce from within the country
or would have to provide training to make them skilled enough to work. Mohamed, Pärn and
Edwards (2017) states that the human resource department within various organisations are
expected to incur additional due to the migration policies post brexit. The EU workforce
comprises of more than 20% labour force which implies that post BREXIT various companies
would face issues in managing their workforce effectively (Thomson 2019). Even though, the
majority of the migrants are coming from non- EU states the membership of EU has always been
perceived as a migration issue. Immigration is a key problem in UK which can be considered as
the reason behind BREXIT. The debate arises from the immigrants comprising from the less
developed countries in the Eastern and Central Europe. Blunk, Benson Marshall and Cox (2020)
suggest that post BREXIT, the companies and human resource management would not face
much challenge as they are skilled workforce that are local to the country for fulfilling the
demand. Moreover, the companies have the option to train unskilled workforce to offer reduced
wages to the employees.
1.5 Literature Gap
Thus, the analysis of the past literature suggest that they are various studies suggesting
that due to migration laws post Brexit, the companies in different sectors will be affected due to
shortage of skilled workforce. The ageing population is a concern where working age population
is less in number which implies that supply does not meet the demand. However, other suggest
that the human resource management would not be affected significantly due to the changes in
Brexit policies. However, all these opinions are speculations, assumptions and forecasts made
based on past data. Therefore, a study is necessary to understand the way Brexit has affected the
human resources and migration issues. A single sector evaluation is necessary to see whether the
demand and supply are meeting and if they are shortage, the strategies needed by the human
resource managers to mitigate the labour shortage.
1.6 Conclusion
Workforce has been considered as an asset in modern organisations and human capital
management is one of the type of practices in businesses. Human resources operate at the pivot
level within all operations as they are responsible for controlling, managing and guiding the
other assets in achieving the goals of the companies. Brexit is expected to have a significant

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impact on the current workforce especially the migrants from EU which is the reason that the
companies to look for options in the market. NHS and the hospitality sector are found to be
highly vulnerable to the changes where the local population has never been sufficient to meet the
needs. A large number of general practice workforce consists of migrants who have been
working longer hours and have been serving older and larger number of patients. Brexit would
result in loss of such workers and it would be difficult for UK administration to such workers
working more deprived areas with longer hours and larger patient numbers. Thus, it can be
concluded a thorough study on the conflicting is necessary through current observations and not
speculation to develop authentic results.

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