In Boris Johnson’s first speech to parliament four weeks ago, he made an unambiguous vow to the 3.2 million EU citizens living in the UK. Thanking them for their contribution to British society, the new prime minister assured EU citizens that under his government they would have the “absolute certainty” of their rights being protected. But a string of reports in the past week has led to increasing alarm among individuals and employers that this promise is in now in doubt. This risks sparking confusion and disarray in the run-up to 31 October.

The muddle arises from reports that home secretary Priti Patel has been pressing for an immediate end to free movement in the event of no deal. This appears to mark a significant shift in policy. Until now, the government has said that in a no-deal scenario, EU citizens will generally continue to be able to come to the UK to live and work until the introduction of a new system in January 2021. While their legal status will change, in practice the main difference is that they will have to apply for European temporary leave to remain for stays of more than three months. Given this status is freely open to all EU citizens, provided they pass certain criminality checks, a version of freedom of movement will in effect continue for at least another year.

But the latest reports could be a game-changer. It’s true that it’s not entirely clear what Patel is getting at. She may simply be referring to the current proposals, which amount to a few modifications to the existing system. This would be manageable, if not ideal. It’s likely, however, that Patel has something more drastic in mind. This will raise alarm bells among EU citizens and employers for three fundamental reasons.

First, there is widespread confusion surrounding the government’s proposals for replacing freedom of movement. The immigration white paper published by Theresa May’s government last December appears to have been superseded by Johnson’s commitment to introduce an “Australian-style” points-based system last month. There is no clarity on what this might entail and it’s virtually impossible that a new Johnson-approved system could be worked out ahead of 31 October.

Second, even if a policy could be devised, it’s hard to see how it could be implemented. Aside from the legislative barriers to introducing a new policy, it would be deeply challenging to practically administer these measures. This is because the enforcement of migration rules is largely done via the labour market: employers would be expected to check whether EU citizens were eligible under the new rules before hiring them. Yet this requires distinguishing between EU citizens currently living in the UK and those just arriving. Given most EU citizens in the UK have not yet applied for “settled status” and so have no clear way of demonstrating their rights, this risks both placing an unfair burden on employers and putting the rights of EU citizens currently living here in jeopardy.

Third, supposing a policy could somehow be devised and implemented, the UK labour market would still need time to adjust to the new system. According to the estimates in the white paper, the government’s current proposals would lead to a reduction in immigration from the EU of around 80%. Analysis by my thinktank, the IPPR, has found that certain sectors such as hospitality, transport and retail would face particular difficulties given that the vast majority of their EU workforce do not meet the proposed skills and salary thresholds. And this does not factor in the administrative challenges for employers: the Federation of Small Businesses has warned that 95% of small employers have no experience of using the current sponsorship system for non-EU workers. The implications for many businesses would therefore be sudden and dramatic.

Even if the government never goes through with these plans, the media speculation is likely to create further uncertainty for EU citizens and business. Since the referendum, net inflows of EU citizens have fallen significantly. It’s likely that this is partly due to the ongoing confusion among EU citizens over their status. The fall in EU migration has taken place in the context of a tight labour market: according to the latest CIPD labour market outlook report, two-thirds of organisations currently hiring have at least some vacancies that are hard to fill. Additional uncertainty – particularly given the wider confusion surrounding a no-deal Brexit – risks further damaging business morale.

If the government wants to ensure businesses and individuals are prepared for a no-deal Brexit, the best thing it can do is to maintain the status quo, at least for the short term. Continuing down the current path is courting political and economic chaos.

• Marley Morris is associate director for immigration, trade and EU affairs at the IPPR thinktank