2025 has been marked by profound geopolitical and economic disruption, reshaping the global employment landscape. As political dynamics shift - most notably with President Trump’s return to office - businesses are navigating an increasingly fragmented and volatile environment. Tariff escalations, ongoing conflicts in Ukraine and the Middle East, and rising political extremes and populism have intensified operational pressures, prompting a wave of restructuring and redundancy exercises across many regions.

One of the most significant developments has been the dramatic shift in the United States’ stance on diversity, equity, and inclusion. Within days of re-entering office, President Trump introduced sweeping changes to federal DEI policy, triggering a chain reaction both domestically and internationally. For international employers, the interplay between local policies and US developments is creating new challenges in aligning corporate values, workforce management, and compliance obligations.

Meanwhile, the rise of remote and hybrid work continues to redefine employment norms. Employees increasingly view flexible working arrangements as non-negotiable, even as many employers push for a return to the office. This tension is driving the adoption of hybrid models that balance operational needs with employee expectations. Certainly, the seismic shift in the way employees want to work in recent years, with more and more businesses engaging a multi-jurisdictional workforce, brings considerable legal challenges ranging from immigration and tax compliance to intellectual property, family leave, and post-termination restrictions.

The rapid advancement of artificial intelligence is also prompting legislative action. The EU AI Act, for example, mandates ethical and transparent AI use, compelling companies to align their practices with evolving data privacy and employment standards. Staying compliant in this space is now a critical priority for global employers.

Finally, attracting the best people, talent mobility and retention remain pressing concerns. As cross-border collaboration becomes the norm, businesses face new risks when employees coordinate international departures. Legal strategies to mitigate competitive threats and protect business interests are becoming increasingly sophisticated.

Overall, in this era of transformation, employers must remain agile, informed, and proactive. Understanding the legal implications of geopolitical shifts, technological change, and evolving workforce expectations is essential to building resilient, future-ready organisations.

Against this background, employment law across the globe continues to evolve. Here are some highlights from the last 12 months.

• Diversity, equity and inclusion
• Pay equity and transparency
• Artificial Intelligence in the workplace
• ESG
• Working hours and arrangements
• Non-competes
• Leave and entitlements
• Trade union and collective rights
• Wages
• Platform workers and employment status
• Restructuring, termination and redundancy
• Retirement and pensions

Diversity, equity and inclusion  

Donald Trump’s return to the presidency in the US resulted in an immediate attack on diversity, equity and inclusion initiatives. His executive orders on ‘Ending illegal discrimination’ and ‘Restoring meritocracy’ have made employers revisit their policies and statements on diversity, particularly affirmative action programmes and quotas. His most recent executive order attacks the concept of disparate impact liability (similar to indirect discrimination in the UK and EU). All of these orders have come under immediate legal challenges, which are working their way through the US federal court system. Notwithstanding these challenges, federal agencies have responded to these orders by actively pursuing a range of strategies to investigate private organisations for alleged violations of civil rights laws based on DEI initiatives.

Meanwhile, elsewhere in the world, countries have been bolstering their laws against discrimination. In January 2025, Singapore passed the first of two landmark bills on workplace fairness. The first bill bans workplace discrimination on grounds of nationality, age, sex, marital status, pregnancy, caregiving responsibilities, race, religion, language, disability and mental health conditions. The second bill will cover how employees can bring claims against their employers, with both bills expected to take effect in 2026 or 2027.

In Hong Kong, new diversity requirements have been introduced for listed companies, including a requirement to have at least one director of a different gender appointed to the nomination committee and a requirement to disclose gender ratios for senior management and the wider workforce.

South Africa has expanded its affirmative action requirements, with all employers employing at least 50 employees now required to take affirmative action regardless of turnover threshold and the introduction of new sector-based targets.

December 2024 was the deadline for EU member states to implement the Women on Boards Directive, but many countries fell behind. The directive creates a target for women on the boards of listed companies, to be achieved by June 2026.

The focus on corporate culture, especially regarding sexual harassment, is expected to continue, with employers being pushed to take proactive organisational responses. This is evident in the EU directive for combatting violence against women, which member states must implement by 2027. This includes requirements that people with supervisory functions receive training on how to recognize, prevent and address sexual harassment at work.

In the UK, from October 2024, employers must take reasonable steps to prevent workplace sexual harassment, which means that employers must take proactive steps to identify the risks of sexual harassment occurring and then take action to control the risks. The legislation follows a similar model to that adopted in Australia in 2023, as discussed at last year’s conference. The UK’s Labour government has committed to going even further in the Employment Rights Bill which raises the bar to require employers to take “all” reasonable steps to prevent sexual harassment and introduces direct liability for employers if staff are harassed by third parties.

Ireland has introduced new restrictions on non-disclosure agreements - including those in severance agreements - where an employee has alleged discrimination, harassment, sexual harassment or victimisation.

Chile and Colombia have introduced legislation focused on record-keeping around sexual harassment complaints, with Colombia also issuing new laws around fines for employers who dismiss workers who raise sexual harassment complaints.

At previous conferences we’ve often discussed the impact of a rapidly ageing workforce across many regions, especially in the Asia Pacific region and Europe. French employer and employee unions have signed a national agreement to promote the employment of “experienced” (note the terminology!) employees, which is now in the legislative process. Once in force, companies with over 300 employees must hold mandatory negotiations every three years - unless otherwise agreed - on employment, job roles, and improving conditions for older workers.  All employers must interview their employees in the year before or after they turn 45, and in the two years before they turn 60, to discuss arrangements and support such as workstation or task adaptations, training, or end of career adjustments. There will be a new, experimental type of open-ended contract for certain employees over 57 or 60, which will allow employers to terminate an employee’s contract upon their eligibility for a full retirement pension, without being required to pay the usual 30% severance contribution. The draft bill also makes it more difficult for employers to deny part-time work requests from employees nearing retirement.

Laws around disability also continue to evolve. In June 2024, Italy introduced legislation redefining the definition of disability, clarifying the scope of reasonable accommodations and setting up a body to protect the rights of people with disabilities. Spain also has a new law addressing how to respond if an employee is permanently disabled, following caselaw confirming that permanent disability is not good enough grounds for automatic termination of employment.

Spain has also pressed on with its landmark legislation promoting equality of LGBTI people in the workplace. The law took effect in March 2024 and required companies with more than 50 employees to adopt equality measures within 12 months. In October 2024, the government passed additional legislation with more details of the measures to be adopted by companies, including an action protocol for dealing with harassment or violence against LGBTI individuals, training and awareness activities, non-discriminatory access to family-related leave and benefits, etc. The measures need to be agreed through collective bargaining or in consultation with employee representatives. 

Moving to a different type of diversity, the Philippines is proposing to require companies to employ indigenous employees if the company operates in areas with indigenous cultural communities. In the UAE, companies with more than 50 employees must increase their Emiratisation percentage by 2% annually and businesses in target sectors with 20-49 employees must meet their 2025 Emiratisation target by hiring one additional UAE national. Fines are imposed for failing to meet these targets.  

Finally, returning back to the US, many states of course will continue to uphold and strengthen their anti-discrimination laws notwithstanding what happens at federal level. 2025 will see California become the first state to effectively recognise intersectionality in anti-discrimination laws perhaps taking the idea from Belgium which recognised the concept of multiple discrimination in 2023.

Pay equity and transparency

With less than a year to go before the 7 June 2026 deadline for implementing the Pay Transparency Directive, EU member states are busy getting legislation in place. The directive’s new rules require companies with over 100 workers to report gender pay gaps both company-wide and within specific job categories. If a pay gap of 5% or more exists and isn’t justified or corrected within six months, a joint pay assessment with worker representatives is mandatory. Individuals also gain new rights, including transparency around pay ranges, protection from pay history inquiries, and access to average pay data relating to comparators and broken down by gender. These individual rights are largely headcount agnostic, so will impact employers with less than 100 workers.

Belgium has partially transposed the directive in the French region, with other countries legislating/proposing to legislate on pay transparency in job adverts, such as Ireland and Poland. Finland, the Netherlands and Sweden have proposed drafts for the full implementation of the directive, with Lithuania publishing a draft for partial implementation. Other countries – including most recently in France - are taking initial steps.

In Ireland, employers with 50+ staff must now report gender pay gap data within five months, and employers will soon be required to publish their reports on a new central online portal.

Brazil requires companies with 100 or more workers to submit pay information to a government portal and to publish a gender pay gap report on their company’s website and social media channels. Mexico also plans to require employers to adopt measures to reduce and eliminate the gender wage gap.

In the US, Massachusetts now requires pay data reporting for employers with 100 or more employees in the state and states including Illinois, Maryland, Minnesota, New Jersey, Washington DC and Vermont have adopted or strengthened pay transparency measures around providing pay ranges to job applicants. Also, the state of Washington recently amended its Equal Pay & Opportunities Act (effective in July 2025) and the City of Cleveland became the third municipality in Ohio to require salary range disclosure (effective in October 2025).

The UK is also contemplating introducing similar pay transparency measures for job applicants and is consulting on introducing ethnicity and disability pay gap reporting for larger employers.

Artificial Intelligence in the workplace

The EU AI Act came into force in August 2024, representing a watershed moment in AI regulation.  Implementation is staggered and February 2025 saw the ban on eight prohibited practices (such as social scoring and biometric categorisation) and literacy requirements coming into force. Employers caught by the Act will need to take steps to ensure that staff and those using AI tools on their behalf have the skills and knowledge to use the tool in an informed and responsible way. In terms of practical guidance, the EU Commission recently published FAQs and codes of practice are expected over the coming year.

Hong Kong’s privacy regulator has issued guidelines for the use of generative AI by employees, prompted by the finding that most organisations lack formal policies in this area. The guidance emphasises the need for clear internal protocols, employee training, and robust data protection measures.

In the absence of new legislation, the UK continues to favour a sector-led, principles-based approach with the publication of the AI Opportunities Action Plan in January. The new year also saw the Financial Conduct Authority hold an “AI Sprint” to foster dialogue between industry, regulators, and academia on the responsible use of AI in finance.

In April 2025, the US regulatory landscape for AI shifted with the issue of two memoranda governing the use and procurement of AI by executive federal agencies.  These memos mark a shift in federal policy towards a more innovation-driven and pro-competition approach, reflecting Trump’s Executive Order 14179 which reversed Biden era AI oversight. 

President Trump’s recent executive order attacking the concept of disparate impact liability, which we mentioned earlier, could also have significant impact on the regulation of AI. It instructs federal agencies to deprioritise the enforcement of disparate impact liability and directs the Attorney General to take action to repeal or amend related regulations. Given the clear risks of disparate impact associated with AI use in the workplace, this sees the US diverging significantly from the approach seen in many other jurisdictions, which is often reflective of the EU AI Act risk-based approach.

Despite deregulation at a federal level, California has introduced a number of AI-related laws, including a bill (set to take effect in 2026) that will require companies to disclose information about the data on which models have been trained. A number of other states are also considering taking a similar approach on transparency.

ESG

Environmental, social, and governance considerations have evolved significantly in recent years, shifting from a niche concern among investors to a foundational element of responsible business strategy and a critical factor in attracting both talent and capital. However, the current economic climate, coupled with President Trump’s re-election, has prompted a rollback of certain environmental protections. To attract international capital and support economic development, jurisdictions like China, Hong Kong, Indonesia and the Philippines are developing their own sustainability reporting rules to align with global standards. While current mandatory disclosures largely focus on climate and environmental issues, they are expected to broaden to include social and governance matters soon.

The EU has revised its Corporate Sustainability Reporting Directive this year in response to criticism that excessive regulatory burdens were undermining competitiveness. The Omnibus proposal in February 2025 releases around 80% of companies from reporting requirements, with reporting standards also being streamlined to make them easier to use. A two-year delay to the implementation of this directive for large companies has been approved and the Corporate Sustainability Due Diligence Directive has also been delayed by a year.

With whistleblowing falling in the ESG arena, the EU Whistleblower Directive has finally been implemented by Poland, the last jurisdiction to do so. In Japan, practitioners have noted a sharp increase in whistleblowing complaints faced by organisations, which is expected to continue through 2025 and beyond. Whistleblowing will also be a focus area in Australia this year, as the Australian Securities & Investments Commission undertakes its five-year statutory review of the federal whistleblowing regime.

European legislation is expanding its scope with the Forced Labour Regulation, which places a comprehensive ban on products made with forced labour being sold, offered or exported from the EU. This applies to a product’s entire supply chain and is due to come into force in December 2027.

Future attention will be on climate issues, particularly employee-related carbon emissions and environmental responsibility. The Netherlands is pushing for stricter environmental compliance, proposing to criminalise serious environmental damage. This builds on its existing requirement to report CO2 emissions from work-related travel and commuting. In Poland there is also legislation to protect those working at high temperatures, and trade unions have campaigned for European regulations on the issue. Conversely, President Trump declared a ‘national energy emergency’ on his inauguration day to facilitate the rolling back of environmental protections, and the US has withdrawn from the Paris climate agreement for the second time.

Working hours and arrangements

Several years post-pandemic, more employers are requiring a high degree of office attendance to restore collaboration and oversight, despite employee preference for remote or hybrid work, fuelling workplace tensions and policy debates.

Ireland introduced a right to request remote and flexible working in March 2024, with early case law emphasising the importance of following a fair process when considering such requests and in the Czech Republic, changes to its Labour Code, to improve job flexibility and work-life balance, came into force in June 2025. The UK is also set to enhance flexible working rights, with new legislation expected to come into force in 2026 requiring employers to have reasonable grounds for refusing flexible working requests.

Singapore’s new flexible work arrangement guidelines came into effect in December 2024, providing a structured process for making and handling requests.  Japan now requires companies to offer at least two flexible work options, like remote work or shorter hours, to employees with preschool children, and will encourage parents of children under three to work from home.

Across the globe, many jurisdictions are reducing statutory maximum working hours to promote employee wellbeing and work-life balance. Brazil is considering lowering the maximum weekly working hours from 44 to 40, Colombia is gradually reducing its weekly limit from 48 to 42 hours by 2026 and Mexico is planning to reduce working hours from 48 to 40 hours and to shift from a six-day to a five-day work schedule.  

Belgium is moving to relax working time rules with "accordion work schedules" to be introduced, while also intending to reduce administrative burdens for employers. Spain plans to cut the standard work week from 40 to 37.5 hours without reducing salaries. In Germany, a proposed reform aims to replace the current daily maximum working time with a weekly cap. While the daily minimum rest period of 11 hours is to remain unchanged, other specific details remain to be finalised. These significant reforms reflect a broader trend toward legislating for shorter working weeks to address burnout and improve quality of life.

The right to disconnect has become a legislative priority in many countries. Australia’s new right to disconnect, effective since August 2024 for larger employers, allows employees to refuse to monitor, read, or respond to employer contact outside working hours unless such refusal is unreasonable. Italy is introducing a law guaranteeing a minimum of 12 consecutive hours of rest after work, prohibiting employer contact during off-hours except in emergencies, with significant fines for breaches, and in Spain, draft legislation will reinforce the right to disconnect, prohibiting employer communications outside working hours except in exceptional cases and will also require companies to keep a daily digital record of working hours. The Netherlands is also considering a bill to regulate out-of-hours accessibility, aiming to prevent stress and burnout by mandating discussions between employers and employees about availability outside working hours. Conversely, in the UK, the new government has backed away from proposals to introduce a 'right to switch off' Code of Practice, although Northern Ireland has proposed a statutory Code of Practice on the right to disconnect, as part of broader legislative reform.

At the EU level, the European Commission launched a consultation in April 2024 on fair remote work and the right to disconnect, following a European Parliament resolution calling for legislative action.

China, Poland, the UAE and Thailand are also amending or extending public holiday entitlement.

Non-competes

Non-compete agreements have been at the centre of significant legal and regulatory activity worldwide over the past year, with a clear trend towards restricting or eliminating their use in order to promote labour market mobility and competition. 

In the US, the overall direction of travel is towards greater restriction, but the legal landscape remains fragmented and uncertain. 

A nationwide Federal Trade Commission rule, that would have rendered an estimated 30,000 non-compete agreements invalid, was due to come into effect in September 2024. Shortly before implementation, however, a federal court in Texas blocked it and enforcement was banned nationwide. The FTC has appealed but then stayed this in March for 120 days. How this will progress under the Trump administration is uncertain.

Nevertheless, several states have responded by introducing or enacting legislation to restrict these clauses. New York is proposing a bill to ban non-competes with exceptions for highly compensated individuals and in cases involving the sale of a business, and Wyoming is introducing similar measures. Virginia is extending its existing ban; it has a fairly long-standing prohibition of non-competes being used for ‘low wage workers’, but recent legislation has amended this definition to bring a wider group of workers in scope.

In contrast, Kansas has presented itself as ‘employer friendly’, enacting legislation confirming the enforceability of non-competes provided they are reasonable in the circumstances but setting more prescriptive requirements for non-solicitation clauses.

Although UK legislative proposals in this area have stalled, the Competition and Markets Authority has identified non-competes as a competition issue, noting that they affect around 30% of workers, and over 40% in some sectors. But for now, employers in the UK are left with the existing common law framework.

Within the European Union there is growing interest in the impact of non-competes on labour mobility.  In Belgium, the Competition Authority ruled in July that non-solicitation clauses between competitors are illegal per se, meaning there is no need to prove possible anti-competitive effects. However, these can be enforceable under certain conditions, including in service agreements. The Netherlands has introduced draft legislation to significantly reform non-compete clauses, including limiting their duration to one year, requiring written justification for their scope and rationale (for both fixed-term and permanent contracts), and mandating compensation for employees during the restricted period.

In Asia-Pacific, Singapore guidelines on non-compete clauses are in the process of being finalised. These guidelines, developed by the Ministry of Manpower and social partners, are not statutory, but will carry significant weight and are intended to ensure that unreasonable non-compete clauses do not become the norm.  Australia has proposed a prohibition of non-competes for most workers, with an exception for high earners.  The government also aims to limit the use of non-poaching agreements.

Leave and entitlements

Family leave entitlements continue to be enhanced worldwide. In the US, the patchwork of various leave entitlements is increasingly complicated, varying from state to state and even within states.

New York, including New York City, now requires employers to allow for up to 20 hours of paid prenatal leave. New York has also mandated paid 30-minute breaks for nursing mothers, while New Hampshire allows such breaks to be unpaid.

There are proposals in the Philippines to increase paid paternity leave to 30 days from 2026 as well as extending this to unmarried partners. Australia has increased the amount of flexible paid parental leave meaning employees will have 26 weeks of government paid parental leave by July 2026.

In the UAE, maternity leave support (for UAE national women in the private sector) will be increased to a total of 90 days’ fully paid leave subject to meeting eligibility criteria and the employer not producing an objection certificate. Saudi Arabia has also increased paid maternity leave to 12 weeks from February 2025.

Singapore has replaced its shared parental leave scheme with a new scheme granting parents up to 10 weeks of government-paid parental leave to be shared between them. This will be phased in beginning with six weeks of leave from April 2025 before increasing to ten weeks in 2026. It has also doubled the length of mandatory government paid paternity leave to four weeks effective from April 2025.

Within Europe, Denmark has extended parental leave to surrogacy arrangements (for both the surrogate and the intended parents). Following a court decision in Spain, single mothers are able to extend their maternity leave to 26 weeks (up from 16 weeks) and provisional guidance confirms that the ruling will extend to all single-parent families. 

Ireland has introduced the right to postpone maternity leave for 5 to 52 weeks due to serious illness and Ireland’s parent’s leave (to be taken in the first two years of a child’s birth/adoption) has been extended to nine weeks. Cyprus has extended the eligibility criteria for parental leave meaning parents can benefit until their child turns 15, as well as increasing the amount of leave that can be taken to 20 weeks.

Japan has introduced enhanced duties for employers to support employees with family caregiving responsibilities. Also, businesses in Japan with 300 or more employees (previously 1,000) are now required to report the annual amount of childcare leave taken by their employees.  

The impact on families of having a premature or unwell baby has led some countries to introduce neonatal leave or extended maternity leave. Indonesia and Poland now allow for extended maternity leave for medical reasons. In the UK, neonatal leave came into force from April 2025 with both parents entitled to up to 12 weeks’ leave (and statutory pay if a 26-week service requirement is met). Starting in January 2026, Colorado employers must permit up to 12 weeks of extra paid family leave for employees with children receiving care in a neonatal intensive care unit.

Growing recognition of the need for bereavement leave has seen some countries seek to introduce new rights or extend existing entitlements.  Saudi Arabia has extended bereavement leave to those who have lost a sibling. Both Mexico and the Netherlands are aiming to introduce five days of paid bereavement leave for employees whose partner or children have passed away, although it is not yet clear if this will become law.

In the UK, the Employment Rights Bill will introduce one week of unpaid bereavement leave for employees. It is expected that this will also include those who have suffered a miscarriage (for the expectant partner and their partner). As of June 2025, Germany has introduced paid miscarriage leave for employees experiencing a miscarriage from the 13^th week of pregnancy. Ireland’s latest legislative programme also includes proposals for leave following pregnancy loss.

A number of countries have introduced changes to support those undergoing fertility treatment to start a family. South Korea has introduced subsidies for infertility treatment as well as extending infertility treatment leave. Hong Kong has introduced a tax break (capped at HKD 100,000 (c. GBP 9,400)) for those with assisted reproduction expenses as a result of a medical reason such as infertility or cancer.

Ireland has paused plans to increase statutory sick leave to seven days following concerns about the impact on certain industry sectors. This means it will remain at five days per year. Portugal has introduced three days of paid leave each month for employees suffering with endometriosis.

Meanwhile, in the US, voters in three conservative states – Alaska, Missouri, and Nebraska – approved referenda that impose mandatory paid sick leave programs. However, in May, the Missouri state legislature repealed paid sick leave.

Various other states in the US continue to expand lawful reasons for using leave and entitlements. For example, in Oregon, employers must allow employees to use paid sick leave time for blood donation and effective in January 2026, Washington state employers will face numerous new obligations related to leave, including a requirement to provide protected leave for a worker who experiences a hate crime.

Trade union and collective rights

There is a continued global trend towards strengthening trade union and collective rights.

The EU is pressing ahead with significant reforms to the EU European Works Councils Directive. If enacted, these reforms would have profound implications for businesses. One of the proposed changes expands the definition of “transnational” matters and will require transnational workers to be informed and consulted in a timely and meaningful way on issues concerning them. The proposed reforms would also strengthen the influence of EWCs and could potentially result in more requests for them to be established.

We are seeing an increased focus in some jurisdictions including China, India, Indonesia, New Zealand, the Philippines, Thailand and Vietnam on employers providing mechanisms and policies for increased employee participation and voice. In Thailand, revisions to key labour laws which would enhance worker rights, including recognising freedom of association of employees and collective wage negotiations, have been fast tracked.

In Canada, a new bill will curtail an employer’s ability to utilise replacement workers during a strike and introduce hefty penalties for violations.

In the UK, the Employment Rights Bill expands the rights to trade union access to the workplace, for recruitment, organisation and collective bargaining. This includes reducing the threshold for unions to secure statutory trade union recognition, and a new law against detrimental treatment or dismissal for going on strike. Ireland has recently closed a consultation to gather views on how it can progressively increase and promote collective bargaining on wages (in line with the EU Directive on Adequate Minimum Wages).

Some countries are bucking this trend and are cutting red tape for employers. For example, in Belgium discussions are ongoing about reducing the number of joint committees, which play a crucial role in employee representation, and could dilute trade union influence in some sectors. New Zealand has plans to reduce the burden on employers when new employees start in a role. The government has introduced a bill that would repeal the “30-day rule” which currently requires new employees to be bound by the terms and conditions of any applicable collective agreement for the first 30 days of their employment, even if they are not a member of the union. New Zealand has also introduced a bill which would reinstate employers’ ability to deduct wages from employees participating in partial strikes. Finally, last year, Finland introduced amended legislation limiting the scope of permitted industrial action, for example, limiting the length of political industrial action and introducing advance notice requirements. The Finnish parliament is now considering a proposal aimed at ensuring essential works continue during industrial action.

Wages

Across the globe, wage regulation is undergoing significant transformation, with a trend towards increased statutory intervention, enhanced enforcement and a focus on fairness and transparency. Inflationary pressures continue to drive upward adjustments to minimum wages, while governments and supranational bodies are introducing new frameworks to ensure wage adequacy and protect vulnerable workers.

In the European Union, the Adequate Minimum Wages Directive stands out as a major development, requiring member states with statutory minimum wages to implement processes ensuring wage adequacy and to take steps to increase collective bargaining coverage where it falls below 80% and mandating stronger enforcement mechanisms and reporting obligations. While the deadline for national implementation was 15 November 2024, the Directive’s future is uncertain following a recommendation for its annulment by the Advocate General of the CJEU, with a final ruling expected imminently.

National reforms are also prominent. In Germany, changes to wage tax deductions and an increase in the subsistence minimum will impact company policies. Further shake-ups result from the German Federal Labour Court having determined that vested virtual share options, considered pay for work already performed, cannot be immediately forfeited or accelerated upon resignation, signalling a significant change in German law affecting bonus and incentive scheme design. Impending pay transparency requirements are also forcing many companies to redesign and renegotiate their pay schemes. 

Outside Europe, legislative responses to “wage theft” are gaining momentum. Australia introduced a new criminal offence for intentional wage underpayment in January 2025, with severe penalties for both companies and individuals, alongside increased civil penalties and a new self-reporting mechanism for employers. South Korea is enacting harsher penalties for habitual wage payment delays, including punitive damages, credit sanctions, and travel restrictions for delinquent employers, effective from October 2025.  In New Zealand, a law passed in March 2025 criminalises intentional wage theft, making employers liable for knowingly failing to pay employees without a reasonable excuse.

India’s new labour codes are likely to prompt disputes over wage restructuring, social security compliance, and variable pay calculations, particularly in hybrid work settings.

Other notable developments include the UK’s new statutory framework for the fair and transparent allocation of tips, effective since October 2024.

Platform workers and employment status

The trend towards specific regulations on digital platform work and increasing protection for platform workers has continued. Significant changes are underway in the EU, with member states having until 2 December 2026 to implement the Platform Workers Directive, which is intended to improve the working conditions of platform workers. This includes requiring them to create a rebuttable legal presumption that platform workers are in an employment relationship if certain conditions are met, the exact conditions being left to each member state.

Unsurprisingly, given this context, working status and misclassification disputes remain a key focus across Europe. Ireland has updated its employment status Code of Practice following a Supreme Court ruling. This is in addition to the Revenue guidelines for determining employment status, which were published last year. In the Netherlands draft legislation aimed at clarifying the distinction between self-employed individuals and employees is still pending. The draft contains a legal presumption of employment if work is performed below a prescribed hourly rate.  From January 2026, the Dutch authorities will resume active enforcement against the “false self-employment” of workers after years of maintaining the status quo while awaiting legislative action. The legislation has been pending for so long that a new initiative bill was recently introduced in Parliament, further complicating this topic for businesses.

In January, a UK Employment Tribunal ruled that hundreds of drivers using a digital platform should be classified as workers, rather than self-employed contractors. A key factor was evidence that drivers were penalised for turning down jobs, so could not freely choose whether to accept or reject work. 

Further afield, there have also been moves to increase protections for platform workers. In December last year, Mexico published a reform, classifying most digital platform workers as employees once they reach a certain level of income. Additionally, since September 2024, online platform drivers in British Columbia, Canada have been entitled to a suite of employee rights including minimum wage, notice of termination, paid mileage and wage statements.

Earlier this year, Australia introduced a new category of “employee-like” workers. This means that workers satisfying certain conditions can apply to the Fair Work Commission if they believe they have been unfairly ‘deactivated’ by a platform. Several other jurisdictions, including China, India, Indonesia and the Philippines, have extended employment protections to wider categories of workers to include some independent contractors, gig workers, casual workers and platform workers.

More broadly, we have seen attempts by some countries to clarify the (often complex) legal position when it comes to determining worker status. In the UK, the government is still formally committed to abolishing the current three categories of employee, worker and independent contractor in favour of a simpler two-part framework, but the proposed reform does not feature in its Employment Rights Bill and it remains to be seen whether this will be quietly shelved or picked up again in future years. In the US, in May 2025, the Department of Labor announced it would not enforce a 2024 rule that tightened restrictions on classifying workers as independent contractors, instead reverting to previous standards and easing enforcement against worker classification.

In June 2025, New Zealand introduced a bill which would create a new category of workers specifically excluded from employment status called “specified contractors”. Under the bill, a worker would be classified as a “specified contractor” if they meet several criteria, including that the worker must be a natural person in an arrangement to perform work with a written agreement specifying they are an independent contractor, the absence of restrictions on working for competitors, the absence of a requirement to be available for work at particular times, the business not being able to terminate if work is turned down, and the worker having a reasonable opportunity to seek independent advice before entering into the arrangement.  Australia has also introduced a new statutory definition of “employee” and “employer”, codifying case law principles. Australia has also created new rights for eligible casual employees, who can request to become permanent employees via a new “Employee Choice Pathway”.

Finally, in April 2025 the Federal Supreme Court in Brazil ordered a nationwide suspension of all court cases that discuss the legality of hiring self-employed workers or legal entities to provide services until it makes a ruling on this and establishes a binding precedent. 

Restructuring, termination and redundancy

Global economic instability and geopolitical uncertainty are creating serious challenges for businesses. President Trump's newly implemented tariffs, coupled with the uncertainty surrounding which will remain in effect and at what rates, have significantly affected the world economy, intensifying financial strain on industries already grappling with rising costs.

Ireland has introduced enhanced protections for employees facing collective redundancies in insolvency situations and has introduced a third ground for legal action in collective redundancy cases - beyond those linked to insolvency - where employers make staff redundant before the 30-day notification period ends.  Meanwhile, in the UK, the Labour government is seeking to enhance requirements related to redundancy consultations. Proposals include introducing a new additional threshold test for collective consultation, which may in some circumstances require counting redundancies across all sites/workplaces. These form part of broader changes proposed in the Employment Rights Bill, which would give employees protection from unfair dismissal from day one of employment.

In Washington state, from July 2025, the law will be expanded to require employers with 50 or more employees to provide at least 60 days' advance notice to affected workers, unions, and state regulators before initiating mass layoffs or business closures.

The cost and consequences of getting things wrong has changed in some countries. In the UK, employment tribunals can now adjust by up to 25% any award it makes in circumstances where there has been a failure to comply with the statutory Code of Practice on Dismissal and Re-engagement. The Employment Rights Bill also proposes doubling the maximum protective award to 180 days per affected employee when an employer fails to properly collectively consult on a collective redundancy.

On the other hand, some countries are reducing employers’ obligations. From July 2025 Finland is raising the threshold for certain employer obligations and reducing the minimum duration of change negotiations by half. In South Africa, significant amendments have been proposed which would streamline the process for large scale redundancies and limit unfair dismissal compensation for high earning employees. Similarly, in New Zealand, the Government has announced it will introduce an income threshold of NZD 180,000 (c.  GBP 80,000) for unjustified dismissal personal grievances, meaning employees who earn more than that will be unable to bring an unjustified dismissal claim.

For employers considering implementing changes to employees’ contractual terms by way of “fire and rehire”, some jurisdictions plan to introduce more robust legislation. For example, the UK government looks set to further strengthen the law so that dismissal and re-engagement will only be permitted as part of a restructuring when there is no viable alternative.

Increased rights have also been introduced in some countries relevant to outsourcing exercises. In Belgium there are new information obligations upon the transfer of an undertaking, whereby employees can request the transferor to share the content from the information and consultation procedure with the transferee, and/or invite the transferee to introduce themselves to the employees. In the Netherlands, a pending bill on the transfer of undertakings in bankruptcy requires buyers to retain all employees unless economic circumstances necessitate job losses. Further afield, in Indonesia, the government plans to regulate the type of work that may be outsourced, which could significantly increase costs for businesses.

Retirement and pensions

Pension systems worldwide are evolving as governments respond to ageing populations and shrinking workforces. Driven by longer life expectancy and declining birth rates, these demographic shifts challenge retirement security and fiscal sustainability. To adapt, policymakers are revising pension laws, but reforms are often politically sensitive, requiring difficult measures like raising the retirement age, adjusting benefits, or increasing contribution rates.

Belgium and China are gradually raising their statutory retirement ages. In Ireland, there are proposals to align retirement ages in employment contracts with the State pension age of 66, while employees can already also choose to defer their State pension up to age 70 for a higher pension.

Spain is encouraging older workers to stay in the labour market longer by easing access to partial retirement. The new law allows employees to partially retire up to three years before the ordinary retirement age and introduces the concept of ‘active retirement’ where pensioners can continue to work part-time while receiving their pension based on reduced working hours. Meanwhile, South Africa’s Constitutional Court is continuing to examine whether employers can enforce retirement at the agreed retirement age.

Belgium is implementing ambitious pension reform with the ultimate aim of reducing pension expenditure. In Spain occupational pension plans are being promoted due to the underdevelopment of company pension plans, with collective bargaining playing a key role.

In Saudi Arabia pension contribution rates are being adjusted in accordance with the new Social Insurance Law, and in the UAE, an optional system for an alternative end-of-service scheme allows employers to pay monthly subscriptions to an investment fund for their workers. 

Employers are likely to face rising pension-related labour costs and obligations due to new pension regulations. In Chile, an additional 7% employer pension contribution will be introduced over nine years, bringing the employer’s contribution to a total of 8.5%. Employers in Ireland may see pension costs increase following the anticipated 2026 rollout of the auto-enrolment scheme, either because they must raise contributions to match the minimum levels or because they need to enrol more employees. The move to abolish the Mandatory Provident Fund offsetting mechanism in Hong Kong is also likely to inevitably increase employers’ business operating expenses.

And finally, while not quite a legal requirement (yet!), ‘tinder leave’ is making waves as a quirky new wellness perk in parts of Asia Pacific. Designed to help employees find love - or at least a decent first date - it’s a reminder that modern benefits are evolving fast. So, whether you're swiping right on the idea or not, it might be time to keep an eye on what your competitors are offering in the romance department.