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Over 2 million EU nationals are at risk of discrimination in UK after shock EU court ruling – here’s what happens next

A surprising ruling from a top EU court means that the UK may be able to discriminate against EU nationals who have been granted the right to live and work in the UK after Brexit.

This decision has huge implications for millions of EU nationals in the UK, some of whom have been resident (and working) in the UK for years, and also raises questions about the meaning of equal treatment throughout the EU.

The Court of Justice of the European Union (CJEU) has upheld a UK rule that bars some EU citizens in the country from accessing benefits. The rule applies to those who have “pre-settled status”, which is one of two new statuses created under the EU Settlement Scheme allowing EU/EEA nationals (and their family members) to remain in the UK post-Brexit. Broadly, those who can show they had lived the UK for five years or more are entitled to settled status, while those with a shorter period of residence get pre-settled status. So far, over 2.3 million people have been granted pre-settled status.

The rights of each status are largely the same, but with one vital difference. In 2019, the UK government introduced regulations requiring those with pre-settled status to show another “right to reside” (typically meaning they are in work) before they can claim welfare benefits.

The case in question concerns CG, an EU national woman with pre-settled status, who came to Northern Ireland in 2018. She subsequently fled a domestic violence situation and has been living in a refuge with her two children. She applied for – and was refused – universal credit on the grounds that her pre-settled status did not entitle her to access benefits in the UK.

Law Centre Northern Ireland persuaded a first-tier benefit tribunal to take the unusual step of referring the case to the CJEU, to ask whether this restriction was discriminatory, and whether EU nationals with pre-settled status should therefore have the same access to benefits as UK nationals.

The ruling

Without much explanation, the court ruled that people in the UK with pre-settled status cannot rely on the right – enshrined in the treaty on the functioning of the EU – to equal treatment on the grounds of nationality. The court also considered whether EU nationals could challenge being denied benefits as discriminatory within the meaning of the Free Movement Directive, which lays down residence rights and conditions for some EU migrants. The view was that these people first had to meet certain conditions, usually being in work.

However, the court suggested that while the UK was entitled to withhold benefits from CG, it must check whether doing so would violate her fundamental rights as contained in the Charter of Fundamental Rights of the EU. These include the right to live in dignity, the right to private and family life, and the best interests of the child.

What is particularly interesting about this case is CG’s position as a woman and a mother. The Free Movement Directive, like other EU free movement laws, is biased in favour of men – taking no account of periods of childcare, care for disabled or elderly relatives, or of periods of instability caused by fleeing from domestic abuse. These social-security risks all disproportionately affect women.

The court of appeal of England and Wales faced exactly the same questions in the case of Fratila in October 2020, but reached a dramatically different conclusion. It ruled that people with pre-settled status were entitled to the protection of EU law from discrimination on the ground of nationality, and should be entitled to claim benefits in the UK.

The UK government appealed to the supreme court, but the case was put on hold pending the CJEU’s judgment in the case of CG. As the CJEU’s ruling has not unequivocally endorsed or prohibited the UK rules, it seems likely that there will now be further hearings. Many claims will be put on hold while we wait for these cases to be resolved.

A person in silhouette looking at the webpage for the EU settlement scheme application.
The EU Settlement Scheme closed on June 30. Louisa Svensson / Alamy Stock Photo

Post-Brexit UK and EU law

Beyond its implications for EU citizens with pre-settled status, the CG case is a good example of how, even after Brexit, EU law remains relevant in the UK. The facts of the case arose before the transition period ended, when EU law still applied, and the court’s judgment is binding throughout the UK.

This case now presents a peculiar possibility. The UK government will probably argue, in a counterintuitive about-face, that EU law should be applicable in the UK, and that the supreme court should disregard UK national courts in favour of listening to the wisdom of the CJEU.

But if the UK government is allowed to maintain its exclusion of pre-settled status as a route to benefits, that exclusion is unlikely to be a blanket one. Individuals may have scope to argue, on a case-by-case basis, that a refusal of benefits would violate their fundamental rights.

All of this complexity only concerns benefits claims made before December 31 2020, but EU law has not stopped being relevant as of January 1 2021 either. The Brexit Withdrawal Agreement provides similar rights to EU and UK nationals who are covered by the agreement for the rest of their lives -– and to their future children. So we may see separate disputes emerging on exactly what rights that confers on people with pre-settled status. The CJEU will continue to have a say on citizens’ rights contained in the Withdrawal Agreement until December 31 2028, by which time pre-settled status will probably be a thing of the past.

It is disappointing that the CJEU has shown itself less inclined than the court of appeal of England and Wales to guard the rights of EU nationals cast adrift in the UK, and that it has done so in a judgment that could seriously disrupt the interpretation of equal treatment rights throughout the rest of the EU, long after the UK has gone.

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