Employment 2026

Introduction

The Chambers Employment Guide 2026 introduces employment law matters across more than 50 jurisdictions. The Guide contains the latest legal information from around the globe on the main changes in employment law that have been enacted or decided in the past year, general remarks on employment contracts and conditions, non-compete and non-solicitation clauses, the data privacy law, the employment of foreign workers, “new work”, the impact of Artificial Intelligence (AI), the role of unions, termination of employment, employment disputes and dispute resolution.

Employment Law

People are at the core of every company’s potential for added value. They manage the ongoing business and develop innovations for future progress and growth. This is why the key component for success in any organisation is how its people work together. The way in which this co-operation is achieved and the framework within which organisations can shape it is regulated by employment law. Due to the relationship of superiority and subordination between employer and employee, the employer enjoys a considerable advantage within this framework. Employment law therefore acts as a balance between the contractual freedom of the parties on the one hand and the protection of employees on the other.

To further redress the disparity between employer and employee, most jurisdictions provide for collective employment law in addition to individual employment law. Individual employment law deals with the legal relationship between the employer and the employee, while collective employment law deals with matters between employers or their coalitions (employers’ associations) and trade unions or co-determination bodies (eg, works councils).

Further peculiarities arise in the event of disputes. In employment law, the economic interests of the parties are particularly important. Employers pursue economically calculated goals; employees rely on their employment relationship for their livelihood. In practice, this often requires quick, pragmatic and interest-driven solutions. More than in almost any other field of law, negotiation skills are indispensable in order to succeed in employment law and cannot be replaced by mere legal expertise.

Global Employment Law

Employment law is primarily national law – the scope of application of employment laws is determined by national boundaries. This leads to different practical implementations and regulations in different countries. One advantage of this is that the states concerned can individually adapt regulations to their requirements and structures. However, in a world where cross-border relationships, takeovers and international contracts have become common practice, this approach can also lead to difficulties, precisely because regulations are designed and applied individually by each country. It is therefore imperative for managers and HR staff not only to know the local employment law standards, but also to have a more general overview and to be aware of the standards in other countries.

In the aftermath of the global COVID-19 crisis, companies recognised that there was less need than previously for a constant workforce in the office, and they became more receptive towards remote working arrangements. As a result, there has been a global trend towards more flexible working models. This trend is now reversed and return to office policies (RTO) are enforced increasingly more often, triggering – amongst others – co-determination challenges

Current Developments

Several current developments have influenced employment law globally in recent years and will continue to do so in the future.

AI at work

AI has moved from the sidelines to the mainstream of working life. Its use ranges from informal adoption by individual employees to company-led initiatives aimed at developing bespoke AI tools for specific workflows and efficiency gains.

The opportunities arising from these developments are matched by considerable risks. Managing those risks is one of the key tasks facing policymakers and businesses alike. Initial steps have been taken, such as the EU AI Act and its national implementation efforts across member states. However, it is becoming increasingly clear that much more remains to be done to keep pace with the speed of technological development and with the challenges these technologies may create, including consequences that are not yet fully foreseeable. The latest Digital Omnibus on AI Regulation, which introduced simplifications and implementation adjustments, has shown practical challenges in this regard.

At the same time, employees and employers are under significant pressure to adapt. The way in which human labour is performed, deployed and valued, is increasingly being called into question – both in light of what AI can already achieve and in view of expectations as to what it may soon be capable of.

Flexible work models

Models such as working from home, mobile working, video conferences and desk sharing have been part of the modern world of work since the COVID-19 crisis at the latest and continue to be popular. At the same time, in many sectors a growing trend towards a return to the office can be observed, often reflected in hybrid work models that combine remote work with a defined level of office presence.

Another significant area is platform work. Digital labour platforms have become an established feature of modern labour markets, enabling businesses and individuals to organise work in a flexible and highly scalable manner. As the transposition deadline of the EU Platform Work Directive approaches in December 2026, attention is shifting towards the classification of platform workers, algorithmic management and the extent to which existing platform-based business models can be maintained under the new regulatory framework. It is expected that legal uncertainty will persist beyond the implementation deadline, as transposition is unlikely to take place in a timely manner across many member states.

Cross-border employment

The continued internationalisation of work has driven cross-border remote work and growing interest in employer-of-record (EOR) arrangements, which enable companies to engage employees in countries where they do not maintain a local legal entity. As these models become more widely used, regulators and courts are increasingly required to assess how existing employment and labour law frameworks apply to new forms of cross-border workforce deployment. Germany provides a notable example with regard to EOR: following considerable uncertainty regarding the potential application of employee leasing rules, developments during 2025 and 2026 clarified the treatment of EOR structures and reduced concerns that such arrangements would generally require an “employee leasing licence”.

Work–life balance

Companies around the world are increasingly concerned with work–life balance as a non-monetary incentive in the competition for the best staff members. Many legislators are supporting this trend with regulations that make it easier to combine family and career, with a particular focus on combating the growing shortage of skilled workers. In Europe, this has been driven mainly by the need to adopt EU directives in national law. These include, for example, the right to paid birthday leave and parental leave in many EU member states, as well as regulations regarding part-time working models and provisions regarding remote working.

Economic pressures

Economic pressures have remained a defining feature of the global employment landscape. Following a difficult post-COVID period, ongoing and newly emerging geopolitical tensions are causing global uncertainty. These, combined with rapid technological development, fierce competition across many sectors and growing resource constraints, have placed considerable pressure on businesses and economies worldwide. As a result, a more cautious approach to investment and workforce planning can be observed in many countries. In some of them, the consequences are increasingly visible in labour markets, including increasing youth unemployment rates and significant workforce reductions as part of large-scale restructuring exercises. Germany's automotive sector provides a notable example of the latter, with a number of major manufacturers and suppliers announcing restructuring measures and workforce reductions over the past year.

Supply chains

Global supply chains remain a defining feature of the modern economy and continue to enable businesses to organise production and services on an international scale. At the same time, recent years have exposed their vulnerability to geopolitical conflicts, trade disruptions, resource constraints and other external shocks. From an employment law and compliance perspective, supply chains remain at the centre of an increasingly active regulatory environment. The EU’s Corporate Sustainability Due Diligence Directive (CSDDD) has been one of the most prominent examples. However, concerns regarding the competitiveness of European businesses and the administrative burden associated with sustainability regulation have led to a reduction in scope and a simplification of compliance requirements. In addition, the application of the framework has been postponed. While the overall objective of promoting responsible business conduct throughout global value chains remains unchanged, the timing and precise scope of future obligations remain subject to ongoing political debate. As a result, supply chain regulation continues to be a dynamic, but also highly uncertain, area for internationally operating businesses.

Pay transparency

Global developments in the area of transparency – particularly pay transparency – have continued since the entry into force of the EU Pay Transparency Directive in April 2023. However, the transposition deadline of 7 June 2026 was missed by many member states. The current status is that only Slovakia, Lithuania, Italy, Malta and Greece have fully implemented the Directive. A few member states have published draft laws, whilst seven other countries (including Germany) are still in the preparatory phase.

Developments in pay transparency have not been limited to Europe. In the United States for example, the regulatory trend has continued to gain momentum, with a growing number of Democrat-governed states requiring employers to disclose salary ranges in job advertisements and introducing other transparency-related obligations. Although no federal pay transparency law currently exists, salary disclosure requirements have become an established feature of the employment law landscape in a significant number of states.

Climate crisis

The climate crisis will have a lasting impact on employment law. While much of the previous discussion focused on reducing CO₂ emissions and promoting sustainable business practices, recent extreme weather events have highlighted the direct effects of climate change on working conditions. Particularly during the summer of 2026, heatwaves across the globe renewed attention on employers’ obligations to protect employees’ health and safety. As a result, issues such as workplace heat protection, working time arrangements during extreme weather conditions and the resilience of working environments are likely to gain increasing importance. At the same time, measures aimed at reducing environmental impacts will continue to play a significant role.

The Guide’s Purpose

Employment law is always in a state of flux and is constantly faced with new challenges due to ever-evolving technology, as well as social developments. Thus, new working models are regularly introduced all over the world and methods are developed to adapt work to modern lifestyles, the needs of society and the circumstances of everyday life. A variety of measures, which differ from country to country, have not infrequently led to highly divergent and sometimes contradictory results. A comparative view of local employment laws in international relations would thus appear essential in a globalised world of work.

Remaining appraised of new legal developments and maintaining the visibility of these on the horizon continues to be critical for employers. As employment laws differ from country to country, this guide aims to answer the most relevant questions in employment law in its participating countries and to provide an insight into current issues.