Global HR News

Ontario Court of Appeal brings back common sense to termination cases

In a significant Canadian employment law decision, the Ontario Court of Appeal has confirmed that common termination clause wording such as "at any time" and "for any reason" does not automatically make a termination provision unenforceable. The ruling provides welcome clarity for employers after a series of conflicting lower court decisions.

The issue before the Court

Ontario courts had recently reached inconsistent conclusions about whether phrases such as:

• "at any time"
• "for any reason"; or
• "at its sole discretion".

This could render termination clauses unenforceable because they appeared to permit dismissals in situations prohibited by the Employment Standards Act, 2000 (ESA), such as dismissals during protected leave or as reprisals for exercising statutory rights.

What the Court decided

The Court of Appeal rejected a purely literal interpretation of these phrases and held that they should be read in the context of the contract as a whole.

"At any time"

The Court held that the phrase "at any time" does not mean an employer can terminate an employee in circumstances where the ESA prohibits dismissal.

Instead, it simply reflects that the employer is not required to wait until a particular contractual event, date or milestone before exercising a contractual right of termination.

"For any reason"

Similarly, the Court held that the phrase "for any reason" does not override statutory protections.

Rather, it simply means that an employer exercising a without-cause termination right does not have to provide a substantive reason for ending employment, subject always to compliance with employment standards legislation.

The Court rejected a "magic words" approach

A key aspect of the judgment is the Court's warning against focusing on isolated phrases without considering the wider agreement.

The Court emphasised that:

• contracts must be interpreted as a whole
• words should not be considered in isolation
• courts should avoid searching for technical ambiguities where none truly exist; and
• no particular phrase automatically determines enforceability.

Why this matters for employers

For several years, Ontario termination clauses have faced increasing legal scrutiny, with employees frequently challenging wording in an attempt to invalidate contractual notice provisions and claim more generous common law notice entitlements.

This decision reduces the risk that an otherwise compliant termination clause will fail simply because it contains wording such as "at any time" or "for any reason".

Important limitation

The judgement does not give employers unrestricted dismissal rights.

The Court made clear that statutory protections remain fully effective. Employers still cannot lawfully terminate employees:

• during protected leave where prohibited by legislation
• in retaliation for employees asserting statutory rights; or
• in any other circumstances restricted by employment standards legislation.

What employers should do

Canadian employers, particularly those with Ontario employees, should:

• review termination provisions to ensure they clearly preserve minimum statutory entitlements
• avoid relying solely on broad termination wording
• ensure employment agreements expressly state that employees will receive no less than applicable statutory minimums; and
• remember that courts continue to scrutinise termination clauses as a whole, not just isolated words.

For HR professionals and employers operating internationally, this decision illustrates a broader judicial trend: courts are increasingly favouring a contextual reading of employment contracts rather than invalidating provisions based on individual words or phrases. While careful drafting remains critical, the Ontario Court of Appeal has effectively confirmed that phrases such as "at any time" and "for any reason" are not, by themselves, fatal defects if the agreement otherwise demonstrates compliance with employment standards legislation.

Ontario court revives extended damages in wrongful dismissal case

A recent Ontario Superior Court decision has attracted significant attention in Canadian employment law after awarding an employee a total of 33 months' compensation following a wrongful dismissal. The ruling is notable because it revived the concept of extending the notice period as a remedy for an employer’s bad faith conduct during dismissal, an approach that has been uncommon in recent years.

Significant damages awarded

The case involved a 55-year-old supervisor with 17 years of service who was dismissed for alleged misconduct. The court ultimately found that the employer did not have sufficient grounds to terminate the employee for cause and awarded 19 months' reasonable notice. In addition, the court granted a further 14 months of compensation due to the employer's conduct during the dismissal process, resulting in a total award equivalent to 33 months' pay.

Focus on employer conduct

A key aspect of the decision was the court's criticism of how the employer handled the termination. The judgement highlighted concerns relating to the investigation process, allegations of misconduct and the manner in which the dismissal was carried out. The court concluded that the employer's actions amounted to unfair and bad faith treatment of the employee.

Potential revival of “Wallace damages”

The decision has generated interest because it appears to revive the concept of so-called "Wallace damages", named after an earlier Canadian Supreme Court case in which notice periods could be extended where employers acted unfairly in the course of dismissal. More recent case law has generally favoured awarding separate aggravated or punitive damages rather than extending notice periods. This latest decision raises questions about whether courts may be prepared to revisit that earlier approach in certain circumstances.

Lessons for workplace investigations

The court emphasised the importance of conducting fair, balanced and well-documented investigations before deciding to terminate employment for cause. Employers should ensure that allegations are thoroughly examined, that employees are given a meaningful opportunity to respond and that conclusions are supported by evidence.

What employers should know

While it remains to be seen whether this decision signals a broader shift in Canadian employment law, it serves as a reminder that the manner in which a dismissal is handled can significantly increase employer liability. Organisations should ensure that investigations, disciplinary processes and termination decisions are conducted fairly, consistently and with appropriate legal oversight.

Employers often focus on whether sufficient grounds exist to terminate employment. This case demonstrates that equal attention should be given to how a termination is carried out. Poor investigation practices, unsupported allegations or unfair treatment during the dismissal process can substantially increase the financial consequences of an otherwise routine termination decision.

New South Wales makes safety codes of practice mandatory

From 1 July 2026, New South Wales has fundamentally changed the status of approved workplace health and safety codes of practice. Organisations must now either comply with applicable codes of practice or demonstrate that their alternative approach achieves an equivalent or higher standard of health and safety.

Codes of practice become enforceable benchmarks

Historically, approved safety codes of practice primarily served as guidance, helping employers understand what regulators considered to be reasonably practicable safety measures. While regulators could rely on them as evidence in enforcement proceedings, compliance was not generally mandatory. The new rules significantly strengthen their legal status.

‘Comply or justify’ approach introduced

Under the new framework, businesses must either follow an approved code of practice that applies to their workplace risks or be able to demonstrate that any alternative approach delivers an equivalent or higher standard of protection. This has been described as a 'comply or justify' model.

Change applies across all safety codes

Although significant attention has focused on psychosocial hazards and workplace mental health, the reform is not limited to those areas. The new duty applies across all approved NSW safety codes of practice, covering issues such as manual handling, hazardous substances, confined spaces, plant safety and psychosocial risks.

Greater emphasis on documentation and evidence

Organisations choosing not to follow a code exactly will need robust evidence showing that their alternative controls achieve at least the same level of safety. Informal practices and undocumented processes may no longer be sufficient. Employers should be prepared to demonstrate how risk assessments, control measures and governance arrangements meet the required standard.

Increased enforcement risk

The changes provide regulators with a clearer benchmark when assessing workplace safety obligations. Inspectors may refer directly to applicable codes when issuing improvement notices, prohibition notices or considering enforcement action. Importantly, organisations may face compliance concerns even where no incident has occurred if they cannot demonstrate compliance with an applicable code or an equivalent alternative.

What employers should know

Employers should review which approved codes of practice apply to their operations and assess whether existing policies, procedures and controls meet the required standards. Where alternative approaches are used, organisations should ensure they are fully documented and supported by appropriate evidence. Training for managers, supervisors and workers may also be required to support compliance.

New South Wales introduces major workers’ compensation reforms

Significant changes to New South Wales workers’ compensation framework took effect from 1 July 2026, representing one of the most substantial reforms to the scheme in recent years. The changes are primarily aimed at addressing growing costs associated with workplace psychological injury claims and improving the long-term sustainability of the compensation system.

Stricter requirements for psychological injury claims

The reforms introduce new definitions and eligibility requirements for workplace psychological injury claims. Employees will generally need to demonstrate that their injury arose from specific workplace events, such as bullying, harassment, violence or excessive work demands, rather than relying on general allegations of workplace stress. The relevant event must also be the primary contributing factor to the injury.

Greater emphasis on objective evidence

A key feature of the new regime is a move towards more objective assessment criteria. Decision-makers will focus more heavily on whether workplace conduct would reasonably be expected to cause harm, rather than solely on an employee’s subjective perception of events. In addition, the Industrial Relations Commission will have expanded powers to determine disputes relating to whether alleged workplace conduct occurred.

Expanded protection for reasonable management action

The reforms strengthen the employer defence relating to reasonable management action. This is intended to provide greater protection where employers are carrying out legitimate management activities, such as performance management, disciplinary action or organisational change, provided these actions are undertaken reasonably.

New obligations and higher penalties for employers

The legislation also increases penalties for certain employer non-compliance and reinforces obligations relating to injury management and the provision of suitable work for injured employees. Employers should review their return-to-work processes and ensure managers understand their responsibilities under the revised framework.

What employers should know

Although the reforms are intended to provide greater certainty around psychological injury claims, employers should not assume that psychosocial risks will receive less regulatory attention. Australian safety regulators continue to prioritise mental health and wellbeing in the workplace, making robust policies, training and investigation procedures essential. Employers may also wish to review bullying, harassment and workload management practices to ensure they align with the new statutory definitions.

While the reforms are designed to reduce uncertainty and control escalating compensation costs, they also highlight the increasing focus on workplace mental health. Employers operating in New South Wales should use this opportunity to review their psychosocial risk management strategies, manager training programmes and employee support arrangements to minimise -the likelihood of disputes and claims.

Tighter rules on cross-border transfers of recruitment data

China has issued further guidance on cross-border data transfers, reinforcing the principle that personal information should only be transferred outside China where it is genuinely necessary for a legitimate business purpose. For employers, this has important implications for the handling of candidate and employee data in global HR systems.

Recruitment data may only be transferred overseas where necessary

A key message arising from the updated guidance is that personal information transferred outside China must be limited to what is necessary for the relevant purpose. In the recruitment context, this means candidate information, including CVs and resumes, should only be transferred overseas where the transfer is genuinely required for recruitment or hiring decisions.

Focus on data minimisation

The Chinese authorities continue to emphasise necessity and proportionality when assessing cross-border data transfers. Organisations should limit both:

• the amount of personal information transferred
• the number of individuals whose data is transferred
• the purposes for which the information is used.

Separate consent remains important

The Cyberspace Administration of China (CAC) has reaffirmed that organisations transferring personal information outside China generally need to provide clear information to individuals regarding:

• the overseas recipient
• the purpose of the transfer
• the categories of information involved
• how individuals can exercise their rights.

Where consent is required, it must be specific and separate from other privacy consents rather than bundled into a general authorisation.

HR data transfers remain subject to limitations

China's guidance also addresses employee data transfers for HR purposes. While certain HR-related transfers may benefit from specific exemptions, authorities stress that:

• Transfers must be necessary for HR management.
• Only data directly relevant to HR administration should be transferred.
• Employers should minimise the impact on employees.
• Higher-risk personal information should be considered carefully before transfer.

Practical impact for multinational employers

Many multinational organisations operate global HR, recruitment and applicant tracking systems hosted outside China. These rules mean employers should be able to demonstrate why overseas access to Chinese applicant or employee information is required and ensure transfers are limited to what is necessary for the relevant recruitment or HR process.

What employers should know

Employers with operations in China should review:

• global recruitment systems
• applicant tracking platforms
• HR shared service arrangements
• internal recruitment workflows involving overseas hiring managers
• privacy notices and consent mechanisms.

Particular attention should be given to ensuring that candidate CVs and other recruitment information are only accessible outside China where there is a clear business need connected to recruitment decision-making.

For global employers, the practical takeaway is that Chinese regulators are increasingly applying a 'necessity first' approach to recruitment and HR data transfers. The days of automatically making all candidate and employee information available across global HR systems are becoming harder to justify. Organisations should be prepared to evidence why overseas access is needed and ensure data flows are proportionate to the recruitment or employment purpose being pursued.

Bombay High Court clarifies scope of ‘workplace’ under India’s POSH Act

A recent Bombay High Court decision has provided important clarification on the definition of ‘workplace’ under India’s Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act 2013 (POSH Act). The court ruled that public transport used independently by employees for their daily commute does not automatically qualify as a workplace for the purposes of the legislation.

Case centred on an employee’s daily commute

The case arose following allegations of inappropriate conduct during a shared auto rickshaw journey to work. The transport had not been arranged or provided by either employer, and the incident occurred during a routine commute rather than during an employer-organised journey.

Court focused on the statutory definition of workplace

The POSH Act defines a workplace broadly and includes locations visited by employees during the course of their employment, including transportation provided by an employer. However, the court concluded that independently arranged public transport falls outside this definition where the employer has not organised or provided the transportation.

Internal Complaints Committee lacked jurisdiction

As the alleged incident did not occur at a workplace as defined by the legislation, the court determined that the Internal Complaints Committee (ICC) did not have jurisdiction to investigate the complaint. The court therefore set aside the committee’s findings on jurisdictional grounds.

Important distinction for employers

The judgement does not narrow an employer’s obligations in situations involving employer-provided transport or locations visited during the course of employment. Instead, it clarifies that there must be a sufficient workplace connection before the ICC can exercise its statutory powers under the POSH Act.

New tax incentive for flexible work arrangements

Malaysia has introduced new tax rules designed to encourage employers to adopt flexible working arrangements. Effective from the 2025 year of assessment, the measures provide qualifying employers with additional tax deductions for certain costs associated with implementing flexible work practices.

New deduction available for implementation costs

Under the new rules, employers can claim an additional tax deduction equal to 50% of qualifying expenditure incurred when introducing flexible work arrangements. This deduction is available on top of normal business expense deductions and is subject to an overall expenditure cap of MYR 500,000.

Flexible work given a broad definition

The legislation adopts a broad definition of flexible working, covering arrangements relating to an employee's place of work, working hours and working schedules. This gives employers considerable scope to design flexible working models that meet operational requirements while potentially qualifying for the incentive.

Training and technology expenditure covered

Eligible expenditure includes costs associated with employee training, internal trainers, training materials, examination fees and training facilities. Employers can also claim relief on software acquisition costs required to support flexible working arrangements. Certain travel, accommodation and meal expenses connected with training activities may also qualify, subject to prescribed limits.

Verification requirements apply

Employers cannot automatically claim the deduction. Flexible working arrangements and related expenditure must be verified by Talent Corporation Malaysia Berhad (TalentCorp), and applications must be submitted within the prescribed period ending on 31 December 2027. Failure to satisfy these requirements could result in the incentive being unavailable.

What employers should know

The incentive presents an opportunity for organisations considering investments in remote-working technology, hybrid working models or manager and employee training programmes. Employers planning significant flexible working initiatives may wish to review whether planned expenditure falls within the qualifying categories and ensure the necessary verification process is completed.

Governments across the Asia-Pacific region are increasingly supporting workplace flexibility through legislative and tax measures. Malaysia's new incentive reflects the growing recognition that flexible working can enhance employee attraction, retention and productivity while supporting broader workforce participation objectives.

More rigorous framework for misconduct dismissals

A significant Employment Claims Tribunals (ECT) decision has reshaped how misconduct dismissals are likely to be assessed in Singapore. The ruling establishes that employers must do more than simply prove misconduct occurred. They must also show that dismissal was a proportionate response to the misconduct identified.

Two-stage test for misconduct dismissals

According to the ECT's first published decision (JGP v JGQ [2026] SGECT 1), employers seeking to justify a misconduct dismissal must establish:

• the misconduct actually occurred on the balance of probabilities that the misconduct was sufficiently serious to justify dismissal as a disciplinary sanctions the tribunal emphasised that a misconduct dismissal carries a lasting impact on an employee's reputation, character and future employability. As a result, dismissal must be both justified and proportionate.

Proper due inquiry remains essential

The decision reinforces the importance of conducting a fair and thorough internal investigation before dismissing an employee for misconduct. Employers cannot simply rely on suspicion or assumptions and must have evidence supporting the allegations contained in the termination decision.

Employers must avoid overstating allegations

One of the key lessons from the decision is that employers should be careful not to exaggerate the nature of the wrongdoing.

In the case considered by the tribunal, the employer characterised the employee's behaviour as dishonest. The tribunal concluded that while the employee had acted improperly, the evidence supported negligence rather than dishonesty. Because the employer could not prove the more serious allegation it relied upon, the dismissal was found to be wrongful.

Consistency in disciplinary action matters

The tribunal also highlighted the need for fairness and consistency when dealing with similar misconduct across a workforce. If some employees receive warnings while others are dismissed for comparable conduct, employers should be able to explain the reasons for the different treatment. Unexplained inconsistencies may undermine the justification for dismissal.

Payment in lieu of notice is not a safeguard

The decision makes clear that paying notice or pay in lieu does not shield an employer from a wrongful dismissal claim where the dismissal is characterised as misconduct. If an employer alleges misconduct, the underlying allegation must still be established through a proper process.

Potential exposure for employers

The tribunal indicated that wrongful dismissal awards may extend beyond notice pay in some circumstances. Employers could potentially face compensation relating to loss of income and harm caused by the fact and manner of the dismissal where the dismissal is found to be unjustified.

What employers should know

When considering dismissal for misconduct in Singapore, employers should:

• conduct a documented and fair investigation
• ensure allegations are supported by evidence
• avoid overstating misconduct in investigation reports or dismissal letters
• consider whether dismissal is proportionate to the proven wrongdoing
• apply disciplinary sanctions consistently across comparable cases
• retain clear records showing why dismissal was considered appropriate HR insight.

For HR professionals, this may be one of the most important Singapore case developments of 2026. Historically, many misconduct cases focused on whether the conduct occurred. The ECT has now indicated that tribunals may also scrutinise whether dismissal was a reasonable and proportionate response. Employers should therefore place as much emphasis on documenting their decision-making process and rationale for dismissal as they do on proving the misconduct itself.

Introduction of comprehensive workplace bullying legislation

Taiwan has introduced a new statutory framework for preventing and addressing workplace bullying, which came into force on 1 July 2026. The reforms move workplace bullying from a largely guidance-based framework to a formal legal regime with specific employer obligations, complaint procedures and potential penalties for non-compliance.

Workplace bullying becomes a legal compliance issue

Under the new framework, workplace bullying is no longer treated solely as an employee relations matter. Employers now have legally enforceable obligations to prevent, investigate and respond to allegations of workplace bullying. Failure to comply may expose organisations to regulatory sanctions, civil liability and reputational risk.

New complaint and investigation procedures required

Employers must establish appropriate reporting channels and workplace bullying prevention measures. The legislation places significant emphasis on process, requiring employers to maintain complaint handling procedures and conduct investigations when concerns arise. In certain circumstances, employers may also be required to notify the relevant labour authority and implement interim measures while investigations are underway.

Duty to act even without a formal complaint

One notable feature of the new regime is that employers may be required to investigate potential bullying concerns even where no formal complaint has been submitted. If an employer becomes aware of circumstances that may indicate workplace bullying, there may be an obligation to take reasonable steps to establish the facts and address any issues identified.

Additional requirements for larger employers

The legislation introduces enhanced compliance obligations based on workforce size. Larger employers may be required to implement formal prevention policies, establish dedicated complaint-handling structures and appoint investigation teams, including external members in certain cases.

What employers should know

Multinational employers operating in Taiwan should review existing dignity at work, anti-harassment and grievance procedures to ensure they align with the new requirements. Organisations may also wish to identify investigation resources, provide manager training and establish clear escalation procedures before complaints arise. Given the procedural nature of the legislation, failures in handling a complaint could create liability even where bullying is ultimately not established.

The new rules reflect a growing trend across Asia towards increased regulation of psychosocial risks in the workplace. Employers should view workplace bullying prevention not only as a compliance obligation but also as an important component of employee wellbeing, culture and risk management. Organisations with operations across multiple jurisdictions may benefit from reviewing whether their global policies provide sufficient protection and investigation procedures to meet evolving local requirements.

One week notice period provides greater flexibility during the first six months of employment

Belgium has introduced a new statutory notice regime that will allow employers and employees to terminate certain employment contracts with just one week's notice during the first six months of employment. The reform, effective from 1 August 2026, is widely seen as reintroducing some of the flexibility previously associated with probationary periods.

One-week notice period introduced

Under the new legislation, either the employer or the employee may terminate an indefinite-term employment contract during the first six months of employment by providing only one week's notice. The same approach applies regardless of which party initiates the termination. Alternatively, the contract may be ended immediately through payment in lieu of the one-week notice period.

Not a return of traditional probation periods

While the change has been described as a return to probationary arrangements, the legislation does not formally reintroduce probation clauses into employment contracts. Instead, it creates a simplified notice regime that automatically applies during the initial six-month period for eligible contracts. Employers do not need to include any specific contractual wording for the rule to take effect.

Applies only to new contracts

The new regime applies only to employment contracts of indefinite duration where employment commences on or after 1 August 2026. Existing contracts remain subject to the previous statutory notice rules, so employers should pay close attention to actual employment start dates when determining which regime applies.

Flexibility works both ways

Although the reform provides employers with greater flexibility when assessing new hires, employees will also be able to leave more easily during the first six months of employment. Organisations may therefore wish to consider the potential impact on retention and onboarding strategies, particularly in competitive recruitment markets.

Documentation remains important

The shorter notice period does not remove other employment law risks. Employers should continue to document performance concerns, conduct issues and business reasons for dismissal carefully. Maintaining appropriate records remains an important risk management practice when terminating employment relationships.

What employers should know

Employers hiring in Belgium should review recruitment processes, employment contract templates and onboarding procedures to ensure they reflect the new rules. Businesses that have historically relied on temporary contracts or agency workers as a means of assessing suitability may also wish to reconsider their workforce planning approach in light of the increased flexibility available within indefinite-term contracts.

Expansion of flexi-job system to most sectors

Belgium has significantly expanded its flexi-job regime, making these tax-advantaged secondary employment arrangements available across almost all sectors from 1 July 2026. The reform represents a major shift in labour market policy and is designed to give both employers and workers greater flexibility.

Flexi-jobs now available across most industries

The most significant change is the reversal of the previous eligibility model. Under the old system, flexi-jobs were permitted only in sectors specifically authorised by legislation. From 1 July 2026, the position is reversed: flexi-jobs are now allowed in all sectors unless a sector expressly opts out through a collective bargaining agreement supported by a Royal Decree.

Greater flexibility for employers and workers

The reform substantially broadens access to secondary employment opportunities. Employees who already have a qualifying primary role can now undertake additional work through the flexi-job system in a much wider range of sectors, creating new opportunities for employers seeking flexible staffing solutions and for workers seeking additional income.

Restrictions on affiliated companies relaxed

A longstanding restriction previously prevented employees from taking a flexi-job with another employer within the same corporate group as their primary employer. The new legislation removes this barrier for employees with a full-time main employment relationship, allowing flexi-job arrangements within affiliated companies.

Favourable tax and social security treatment retained

Flexi-jobs continue to benefit from advantageous tax and social security treatment. Income earned through qualifying flexi-jobs remains subject to favourable rules, although annual earnings limits still apply. For 2026, the earnings ceiling has been set at EUR 18,880.

Clarification of remuneration rules

The legislation also clarifies how remuneration limits are calculated. Certain payments, including shift premiums, night work premiums, overtime premiums and some additional benefits, are excluded when assessing whether remuneration exceeds the applicable flexi-job pay threshold. This provides employers with greater certainty when designing reward arrangements.

Sector-specific exclusions remain possible

Although the expansion is extensive, it is not universal. Certain occupations and activities remain excluded, and sectors retain the ability to opt out of the system. Some industries have already indicated that they may restrict or prohibit the use of flexi-jobs within their sector.

What employers should know

Employers operating in Belgium should review whether flexi-jobs could provide additional workforce flexibility, particularly in sectors experiencing recruitment challenges or fluctuating demand. Businesses should also verify whether sector-specific restrictions apply before implementing arrangements and ensure payroll processes reflect the revised remuneration rules.

Major reforms to automatic wage indexation

Belgium has introduced significant changes to its long-standing system of automatic wage indexation. The reforms, which took effect on 1 June 2026, temporarily limit inflation-linked salary increases for higher earners while leaving the existing system unchanged for employees earning up to EUR 4,000 gross per month.

Changes target higher-paid employees

Under the new rules, employees whose gross monthly salary exceeds EUR 4,000 will no longer receive full automatic indexation across their entire salary during designated moderation periods. Instead, indexation will generally apply only to the first EUR 4,000 of monthly remuneration, with restrictions applying to earnings above that threshold. Employees earning EUR 4,000 or less per month remain unaffected.

Automatic indexation remains in place

The reforms do not abolish Belgium's automatic wage indexation system. Salaries will continue to be linked to inflation in accordance with sectoral collective bargaining arrangements. However, the government has introduced a temporary cap aimed at slowing labour cost growth while maintaining protection for lower and middle-income workers.

New employer costs introduced

Alongside the changes to wage indexation, the legislation introduces additional employer social security contributions. These measures are intended to offset reductions in tax and social security revenues that may result from the restricted application of salary indexation. Further guidance on the operation of these contributions is expected from the Belgian authorities.

Increased payroll complexity

Because wage indexation arrangements differ between sectors, the practical impact of the reforms will vary across employers. Some organisations will experience the changes immediately, while others may not be affected until their next scheduled indexation date. Employers will need to carefully monitor salary calculations, particularly where employees are subject to different indexation mechanisms or remuneration structures.

What employers should know

Employers operating in Belgium should review payroll processes, budgeting assumptions and employment cost forecasts to ensure compliance with the new rules. International employers with assignees or local employees in Belgium may also wish to assess the potential impact on reward strategies and employee communications.

Belgium is one of the few European countries with a comprehensive system of automatic wage indexation. These reforms represent a notable shift in approach, balancing protection against inflation with efforts to manage labour costs and improve economic competitiveness. Employers should prepare for greater administrative complexity and ensure payroll teams understand how the new measures apply within their sector.

Can the chosen law override more protective employment rules? The CJEU clarifies

The Court of Justice of the European Union (CJEU) has provided important guidance on how choice-of-law clauses operate in international employment contracts. The decision confirms that an employer's chosen governing law may, in certain circumstances, prevail over the law of the country where the employee habitually works, even where that country's employment rules appear more protective.

The facts

The case involved a Swiss employer and an employee who lived and habitually worked in France. Their employment contract expressly selected Swiss law as the governing law. When the employee was dismissed, the employer followed Swiss dismissal procedures. The employee argued that French dismissal protections should apply because he worked in France.

A key difference was that French law required procedural protections, including a pre-dismissal interview and reasons for dismissal, whereas Swiss law did not impose the same requirements.

The legal question

The issue concerned the interaction between:

• the parties' choice of governing law
• the law of the country where the employee habitually works
• the "escape clause" under European law (Rome Convention), which allows a court to apply the law of the country most closely connected with the employment relationship.

What the CJEU decided

The Court clarified that the law chosen by the parties can itself be regarded as the law of the country most closely connected with the employment relationship. If that is the case, the chosen law may become the applicable law under the escape clause rather than merely being a contractual choice.

The Court therefore rejected the idea that the law of the employee's habitual workplace automatically overrides the chosen law whenever it offers stronger protection. Instead, courts must assess all relevant circumstances to determine which country has the closest connection to the employment relationship.

Factors that may support a closer connection

The employer argued that the relationship was closely connected with Switzerland because:

• salary was paid in Swiss francs
• payments were made into a Swiss bank account
• the employee participated in Swiss social insurance arrangements
• the employee benefited from Swiss tax arrangements
• the employee used Swiss business systems and communications infrastructure.

The CJEU indicated that such objective connecting factors can be taken into account when determining the country most closely connected with the employment relationship.

Why this matters for employers

The judgement is particularly relevant for multinational employers and remote-working arrangements. It confirms that determining the applicable law is not simply a matter of identifying where the employee physically works. Courts may examine the broader economic and organisational context of the employment relationship.

What employers should know

For employers with international workforces:

A governing law clause remains important and can carry significant weight. The employee's habitual place of work is still highly relevant but is not always decisive. Courts will assess the overall connections between the employment relationship and different countries.

This decision will be particularly relevant where employers engage employees cross-border, including remote workers, expatriates and internationally mobile employees. From an HR and global mobility perspective, it reinforces the importance of looking beyond the employment contract itself and considering factors such as payroll arrangements, tax treatment, social security coverage and organisational integration when assessing employment law risk. The place where the employee physically works remains important, but the CJEU has confirmed it is not necessarily the end of the analysis.

Employment Contracts Act reform

Finland has introduced a package of amendments to its Employment Contracts Act, with the changes taking effect on 1 June 2026. The reforms are intended to increase labour market flexibility, particularly for smaller employers, while simplifying certain employment law requirements.

Re-employment obligations reduced for smaller employers

One of the most significant changes concerns the obligation to rehire employees made redundant. Employers with fewer than 50 employees are no longer required under statute to offer the same or similar work to redundant employees if suitable vacancies arise within the post-termination re-employment period. However, collective bargaining agreements may still preserve or modify this obligation in particular sectors.

Layoff notice period shortened

The reforms halve the statutory notice period for temporary layoffs. From 1 June 2026, employers are only required to provide seven days' notice of a layoff rather than the previous 14 days. Employers must nevertheless continue to observe any longer notice periods required under applicable collective agreements.

Greater flexibility for fixed-term employment contracts

Perhaps the most notable reform is the introduction of a right for employers to enter into fixed-term employment contracts of up to 12 months without needing to demonstrate a specific justified reason. Previously, Finnish employers generally needed an objective business justification for the use of fixed-term contracts.

Safeguards still apply to fixed-term arrangements

The flexibility comes with important limitations. The new exemption applies only where the employee has not been employed by the same employer during the previous five years. In addition, if a fixed-term contract is concluded under these rules for less than 12 months, it cannot simply be extended or renewed under the same mechanism. The legislation also provides termination rights after six months of employment in certain circumstances.

Part of a broader labour market reform agenda

The June reforms build upon earlier Finnish employment law changes during 2026, including amendments that lowered the threshold for dismissals on personal grounds and changes designed to provide greater flexibility for employers. The government's stated objective has been to reduce barriers to recruitment and support smaller businesses while continuing to maintain core employee protections.

What employers should know

Employers with operations in Finland should review:

• fixed-term contract templates and hiring practices
• redundancy and re-employment procedures
• layoff processes and notice requirement
• the impact of any applicable collective bargaining agreements, which may continue to impose more stringent obligations.

These reforms signal a clear move towards increased labour market flexibility in Finland. For employers, the ability to engage employees on short fixed-term contracts without a specific business justification may make recruitment less risky, particularly for SME’s. However, collective agreements remain highly influential in Finland, meaning employers should not assume that the statutory relaxation automatically applies in practice across all sectors.

The concept of a “sexual harassment work environment” and expanded protection for employees

France's Supreme Labour Court has expanded the scope of protection against workplace sexual harassment by recognising the concept of a "sexual harassment work environment". The decision confirms that employees may be protected even if they are not the direct target of inappropriate conduct, provided they are exposed to a workplace environment that is humiliating, degrading or hostile because of such behaviour.

Protection extends beyond direct victims

The case concerned an employee who raised concerns about sexually inappropriate behaviour by a supervisor towards colleagues. Although the employee was not the direct victim of all the conduct complained of, the court held that she had nevertheless been exposed to a degrading and humiliating workplace environment created by that behaviour.

Broader interpretation of sexual harassment

The ruling represents a significant development in French employment law by recognising that sexual harassment can affect individuals beyond those directly subjected to inappropriate comments or actions. The court acknowledged that exposure to a workplace culture or environment characterised by such behaviour may itself constitute a form of harm.

Increased risk for employers

The decision is likely to broaden the circumstances in which sexual harassment claims may arise. Employers may now need to consider not only whether specific employees have been subjected to inappropriate conduct, but also whether workplace behaviour has created an intimidating, hostile or degrading environment for others within the organisation.

Review policies and training

The judgement highlights the importance of maintaining robust anti-harassment policies, reporting procedures and manager training programmes. Employers should ensure that complaints are investigated promptly and that workplace cultures do not allow inappropriate conduct to become normalised, even where concerns are raised by employees who are not the direct target of the behaviour.

What employers should know

Organisations operating in France may wish to review their harassment policies and training materials to ensure they reflect this broader interpretation of sexual harassment. Internal investigations should also consider the wider workplace impact of inappropriate conduct and not focus solely on direct victims.

This decision reflects a broader international trend towards recognising the wider cultural impact of workplace misconduct. For employers, the focus is increasingly shifting from addressing isolated incidents to ensuring that the overall working environment remains respectful, inclusive and free from behaviour that could create a hostile atmosphere for employees.

Court confirms risks of using former employees’ images

A recent French Supreme Labour Court decision serves as a reminder that employers must carefully manage the use of employee photographs and other images after employment ends. The court confirmed that continuing to use a former employee’s image without clear authorisation can result in financial liability, even where no specific loss has been demonstrated.

Consent does not automatically survive termination of employment

The case concerned a former employee who had previously authorised his employer to use his photograph. After leaving the organisation, he discovered that his image continued to appear on the company’s website. The courts found that the original authorisation did not clearly permit use of the image following the end of the employment relationship.

Damages awarded to former employee

The employee successfully brought a claim and was awarded compensation. The Supreme Labour Court confirmed that an employer cannot rely on an employment relationship to justify continued use of an individual's image once that relationship has ended, unless the consent provided clearly covers post-employment use.

Importance of clear image rights documentation

The decision highlights the need for employers to ensure that image consent forms clearly define how photographs may be used, where they may be published and, importantly, how long the authorisation remains valid. Vague or incomplete wording may not provide sufficient protection if a dispute arises.

Marketing and communication materials require regular review

Many organisations use employee photographs on websites, social media platforms, recruitment materials, organisational charts and marketing collateral. Employers should ensure that processes are in place to remove or replace images when employees leave, unless valid ongoing consent exists.

What employers should know

Businesses operating in France should review image consent forms and establish procedures to regularly audit websites, internal directories and promotional materials. Particular attention should be paid to ensuring that former employees' images are not retained beyond the period authorised by the individual concerned.

As employers place increasing emphasis on employer branding and digital communications, image rights are becoming an important compliance consideration. Organisations should ensure that employee consent is specific, informed and appropriately documented, particularly where photographs may continue to be used long after they were originally taken.

Significant changes to employment law proposed

Germany's governing coalition has announced a wide-ranging package of employment law reforms that could substantially alter the employment landscape if enacted. While the proposals are still subject to the legislative process, employers with operations in Germany should start considering the potential implications.

Easier termination of certain higher-paid employees

One of the most notable proposals is the introduction of a new mechanism that would allow employers to terminate the employment of certain high-earning employees in exchange for severance payments. Currently, German employment law generally requires employers to demonstrate a valid legal reason for dismissal, such as misconduct, capability concerns, or operational requirements. The proposed reform would create a new route to ending employment relationships, offering employers greater flexibility in managing senior or highly paid employees.

Greater flexibility for fixed-term contracts

The government is also proposing to relax Germany's fixed-term employment rules. Under the plans, employers would be able to engage employees on fixed-term contracts without providing a specific justification for a longer period than is currently permitted. Restrictions on rehiring former employees on fixed-term arrangements may also be eased. In addition, the requirement for fixed-term contracts to be signed in hard copy is expected to be removed, supporting more streamlined digital hiring processes.

Changes to sickness absence procedures

The reform package seeks to address concerns around high sickness absence levels in Germany. Proposed measures include ending the use of telephone-issued sickness certificates and requiring medical evidence from the first day of absence. The government also intends to strengthen penalties for the improper issuing of medical certificates. Employers may welcome these developments as a means of improving absence management and reducing potential misuse of the current system.

Additional measures

Other proposals include tax incentives linked to severance payments where individuals secure new employment quickly, increased tax-free limits for certain weekend and public holiday supplements, and initiatives designed to support employees moving between jobs. The coalition has also highlighted a desire to reduce administrative burdens, simplify aspects of data protection compliance, and facilitate the introduction of new workplace technologies while preserving employee consultation rights.

What employers should do now?

At present, these reforms remain proposals and have not yet become law. However, given their potential impact on recruitment, workforce planning, contract management, restructurings and absence management, employers operating in Germany should monitor developments closely over the coming months.

New tax incentives for employee share options proposed

Luxembourg's government has introduced draft legislation that would create a more favourable tax framework for employee stock option plans offered by qualifying start-ups and scale-ups. The proposal forms part of a wider effort to attract innovative businesses and highly skilled talent to the country.

Taxation deferred until shares are sold

Under the proposed regime, employees receiving qualifying stock options would not be taxed when options are granted, vested or exercised. Instead, tax would only become payable when the employee ultimately sells the shares acquired through the option plan. This approach aims to address a common concern for start-up employees, namely being taxed before they have realised any financial gain from their investment.

Attractive treatment of gains

The draft legislation proposes that any gain realised on the sale of shares would be treated as extraordinary income and taxed at a reduced effective rate. The intention is to make equity-based reward arrangements more attractive and help younger businesses compete for talent where cash remuneration may be more limited.

Eligibility restrictions apply

The proposed regime would be available only to qualifying innovative companies that meet specific conditions relating to age, size and business activities. Certain sectors would be excluded, and employees with significant ownership interests in the business would not be eligible for the preferential treatment. The proposals are also designed to ensure that stock options are not simply used as a substitute for normal salary payments.

Existing rules to be clarified

Alongside the new start-up regime, the legislation would formally codify Luxembourg's existing tax treatment of employee stock option plans. This should provide greater certainty for employers operating equity incentive arrangements and establish clearer valuation and reporting requirements.

What employers should know

Employers wishing to benefit from the new regime would need to actively elect to it and comply with specified reporting obligations. If approved by Parliament, the new rules are expected to apply to qualifying stock options granted from 2027 onwards.

The proposals highlight Luxembourg's growing focus on supporting innovative and high-growth businesses. If enacted, the changes could make share-based reward programmes significantly more attractive for both employers and employees, particularly within the start-up and technology sectors.

Key labour reforms employers should monitor

Dutch employment law continues to evolve rapidly, with a number of significant reforms progressing through the legislative process. The proposals reflect a broader focus on strengthening protections for platform workers and flexible workers, modernising employment legislation and implementing new EU employment law requirements.

New rules proposed for platform work

The Dutch government has launched a consultation on legislation implementing the EU Platform Work Directive. The proposed reforms would introduce a legal presumption that certain platform workers are employees, strengthen protections relating to automated decision-making and limit the processing of personal data through algorithmic management systems. Important employment decisions would require meaningful human oversight.

Major overhaul of leave legislation

A proposed Leave Act would replace the existing Work and Care Act and restructure leave entitlements into three categories: parental leave, leave to care for relatives and personal leave. The reforms aim to simplify the leave framework and create greater consistency across different forms of statutory leave, including aligning notification requirements and eligibility rules.

Restrictive covenant reform moves forward

The Dutch government is continuing work on reforms to non-compete clauses. Current proposals would place greater limitations on the use of restrictive covenants, including introducing a maximum duration, requiring employers to justify their use and potentially providing compensation to employees where restrictions are enforced. The reforms are intended to balance employee mobility with legitimate business protection.

Flexible work and employment status remain under scrutiny

The Netherlands continues to focus on reducing labour market segmentation and strengthening protection for flexible workers. Legislative proposals include measures addressing temporary work arrangements, employment status, and legal presumptions of employment for lower-paid independent contractors. These developments are likely to have significant implications for organisations relying on contingent labour models.

Pay transparency requirements approaching

The Dutch legislature is also progressing implementation of the EU Pay Transparency Directive. Employers should expect increased obligations around pay reporting, transparency in recruitment processes and gender pay gap monitoring as the legislation continues through Parliament.

Other reforms on the horizon

Additional proposals currently under discussion include changes to staff retention measures during economic crises, reforms to reintegration obligations for employers managing long-term sickness absence, accreditation requirements for labour providers and the development of a mandatory disability insurance framework for self-employed workers.

What employers should know

Employers operating in the Netherlands should closely monitor these developments, as many of the proposals would affect workforce planning, employment contracts, flexible worker arrangements and compliance obligations. Businesses using freelancers, platform workers or temporary labour arrangements may face particular scrutiny as employment status reforms continue to develop.

Government considers additional paid leave entitlement for single parents

A legislative proposal currently under consideration in Romania would extend additional paid leave rights to employees who are single parents. If adopted, the change would broaden existing Labour Code provisions and provide greater support for employees balancing work and sole caregiving responsibilities.

Additional leave proposed for single-parent employees

The proposal seeks to amend Article 147(1) of the Romanian Labour Code to include single-parent employees among the categories of workers entitled to additional paid leave. Under the proposal, eligible employees would receive at least three additional working days of paid leave each year.

Expansion of existing leave rights

Currently, the additional paid leave entitlement applies to certain specified groups of employees, including those working in difficult, dangerous or harmful conditions, employees with disabilities and employees under the age of 18. The proposed amendment would extend these protections to single-parent workers.

Focus on supporting working families

The proposal reflects an increasing focus on family-friendly employment policies and recognition of the challenges faced by employees who have sole responsibility for caring for children. If implemented, the measure would provide additional flexibility for single parents to manage family commitments alongside their professional responsibilities.

What employers should know

At this stage, the proposal has been submitted to the Senate and has not yet become law. Employers with operations in Romania should monitor its progress and consider the potential workforce planning and leave management implications if the amendment is ultimately approved.

Parliament completes Employment Tribunal time limit reforms

The UK Parliament has approved the final regulations needed to implement the Employment Tribunal time limit reforms introduced by the Employment Rights Act 2025. From 1 October 2026, the limitation period for most Employment Tribunal claims will increase from three months to six months, giving workers significantly longer to bring claims.

Most tribunal claims will have a six-month deadline

The reforms extend the limitation period for most statutory Employment Tribunal claims from three months to six months. The objective is to provide individuals with more time to understand their legal rights, obtain advice and participate in pre-claim processes before deciding whether to commence proceedings.

Regulations close important gaps

Although the Employment Rights Act 2025 introduced the headline reform, some claims created under secondary legislation were not originally included within the extended time limits. The newly approved regulations address this issue and bring additional claims within the six-month regime, helping to create greater consistency across the Employment Tribunal system.

Breach of contract claims also affected

The reforms extend the six-month limitation period to certain breach of contract and wrongful dismissal claims brought in Employment Tribunals in England and Wales. Other claims benefiting from the extended timeframe include those involving fixed-term employees, part-time workers, whistleblowing protections, collective consultation obligations and zero-hours contract rights.

Changes apply from 1 October 2026

The new time limits will generally apply only where the act or omission giving rise to the claim occurs on or after 1 October 2026. Claims based entirely on events occurring before that date will remain subject to the existing three-month limitation periods.

Longer period of potential liability for employers

The reforms mean employers may face a substantially longer period during which claims can be brought. Employees will have more time to seek legal advice, engage in ACAS Early Conciliation and explore settlement options before deciding whether to issue proceedings. This may extend the period of uncertainty following disputes, dismissals or workplace grievances.

What employers should know

Employers should review document retention practices and ensure records relating to disciplinary action, grievances, investigations, performance management and dismissals are retained and easily accessible for longer periods. HR teams and managers should also be aware that potential claims may now arise many months after the underlying event.

This is one of the most significant procedural changes to the Employment Tribunal system in recent years. While the reform is intended to improve access to justice, employers should expect claims to remain "live" for longer and should place greater emphasis on robust documentation, consistent processes and early dispute resolution.

Right to work compliance extended beyond direct employees

From 1 October 2026, the UK's right to work regime will undergo one of its most significant changes in recent years. New legislation will extend compliance obligations beyond traditional employees, bringing a much wider range of working arrangements within the scope of illegal working checks and potential penalties.

Compliance obligations extend beyond employees

Historically, right to work checks have focused primarily on direct employees. Under the new regime, organisations that engage labour through alternative arrangements may also become responsible for ensuring individuals have the legal right to work in the UK. The reforms are intended to reflect the reality of modern workforce models and close perceived gaps in existing immigration compliance requirements.

Wider range of workers brought into scope

The changes are expected to affect organisations using agency workers, individual subcontractors, casual workers, temporary workers, zero-hours workers, gig economy workers and certain platform-based labour arrangements. Businesses that rely heavily on contingent labour or outsourced workforce models are likely to be particularly affected.

Supply chain risks increase

One of the most significant aspects of the reform is the extension of potential liability beyond direct contractual relationships. In some circumstances, organisations may face penalties where illegal working occurs within wider labour supply chains or subcontracting arrangements. As a result, immigration compliance may increasingly become an issue for procurement, contract management and operational teams, rather than being solely an HR responsibility.

Significant penalties remain

The existing civil penalty framework remains in place, with businesses potentially facing substantial fines where they fail to establish an appropriate statutory excuse. However, because a much broader range of working relationships will fall within scope, the overall compliance risk for many organisations is expected to increase significantly.

Businesses should review labour engagement models

Organisations should begin assessing all categories of labour used across their operations, including contractors, consultants, temporary workers and outsourced service arrangements. Existing onboarding procedures, supplier contracts and right to work processes may need updating to reflect the expanded requirements.

What employers should know

The reforms will apply only to newly covered arrangements commencing on or after 1 October 2026, with existing engagements generally not requiring retrospective checks. Nevertheless, employers should use the lead-in period to review labour supply chains, identify potential areas of risk and establish appropriate compliance procedures before the new rules take effect.

High Court strikes down overly broad non-compete clause

A recent High Court decision highlights the importance of carefully drafting post-termination restrictions. The court ruled that a six-month non-compete clause was unenforceable because it went further than reasonably necessary to protect the employer's legitimate business interests.

Restrictive covenants must be proportionate

The case involved a sales manager who left a national builders' merchant to join a competitor. His employment contract contained a six-month non-compete restriction covering competing businesses within a defined geographical area. The employer sought to enforce the restriction, arguing it was needed to protect customer relationships and confidential information.

Court found the restriction was too broad

Although the court accepted that the employer had legitimate interests worth protecting, it concluded that the covenant extended beyond what was reasonably necessary. The restriction could have prevented the employee from working in a wide range of roles, including positions that had little or no connection to the duties he previously performed.

Better drafting may have achieved the desired protection

The judgement noted that more targeted restrictions, such as properly drafted non-solicitation or non-dealing clauses focused on key customers, may have been sufficient. The court was critical of weaknesses in the employer’s contractual documentation and suggested that narrower protections would have been more likely to survive legal scrutiny.

Probationary periods also came under scrutiny

An additional factor was that the non-compete applied from the start of employment, despite the employee being subject to a very short notice period during probation. The court questioned whether such a lengthy restriction could genuinely be justified at a point when the employee had not yet developed meaningful customer relationships or gained significant access to sensitive information.

Confidential information claim also failed

The employer also sought to rely on alleged misuse of confidential information. However, the court declined to grant the requested relief, finding insufficient grounds to support the employer’s claims in the circumstances of the case.

What employers should know

Employers should review restrictive covenants regularly to ensure they are tailored to the specific role and risks involved. Restrictions that are too wide in terms of duration, geography, activities or scope may be unenforceable. Particular care should be taken when applying standard clauses across different employee populations without considering the individual's actual responsibilities and access to sensitive information.

Acas publishes draft Code of Practice on disciplinary and grievance

The Advisory, Conciliation and Arbitration Service is an independent public body funded by the UK government that helps resolve workplace disputes, improves working life, and provides impartial advice on employment rights and workplace laws for both employers and employees Acas has published a draft replacement Code of Practice on disciplinary and grievance procedures, representing the first major overhaul of the Code since 2009. The central theme is clear: encourage employers and workers to resolve workplace concerns earlier, more informally and with less conflict before matters escalate into formal procedures or Employment Tribunal claims.

Why is Acas proposing changes?

Acas says formal disciplinary and grievance procedures cost UK employers around £2.36 billion per year, while research indicates that 44% of working-age adults experienced workplace conflict during the previous 12 months. The draft Code is intended to encourage earlier intervention and reduce the financial and personal costs associated with workplace disputes.

Informal resolution becomes a central requirement

The biggest proposed change is the much greater emphasis on resolving issues informally before commencing formal disciplinary or grievance procedures.

Under the draft Code, employers would generally be expected to consider informal discussions, facilitated conversations or mediation before moving to a formal process. Employers may need to explain what informal steps were taken, or why informal resolution was not appropriate, if a formal process is subsequently initiated.

For HR practitioners, this is potentially a significant shift. Informal resolution would move from being good practice to becoming an important factor that tribunals may consider when assessing procedural fairness.

Fundamental fairness principles remain unchanged

Despite the additional emphasis on early resolution, the core principles of a fair disciplinary and grievance process remain intact:

• prompt handling of issues
• appropriate investigation
• informing workers of allegations and potential consequences
• giving workers an opportunity to respond
• making reasonable decisions
• providing a right of appeal
• broader focus on management quality.

The draft code places greater emphasis on the quality and consistency of management decision-making rather than simply following procedural steps.

New expectations are proposed around:

• manager training
• use of mediation
• reasonable adjustments
• suspension decisions
• communication during investigations and hearings.

Significant implications for employers

A failure to follow the Acas Code can currently result in an Employment Tribunal increasing compensation by up to 25% where non-compliance is unreasonable. That mechanism would remain in place under the new Code.

This is particularly important given the wider Employment Rights Act reforms and expected increases in tribunal activity. Employers may find tribunals scrutinising not only whether a procedure was fair, but also whether genuine efforts were made to resolve matters before formal disciplinary action was initiated.

Consultation period

The consultation opened on 30 July 2026 and closes on 23 September 2026. The draft Code is not yet law and may change following consultation responses.

What employers should do now?

For UK employers, particularly those managing disciplinary and grievance processes regularly, it would be sensible to start reviewing:

• disciplinary and grievance policies
• use of informal conversations and mediation
• manager training programmes
• investigation and suspension procedures
• documentation that records attempts at informal resolution.

From an HR perspective, this could be one of the most important UK employee relations developments of 2026. The draft Code signals a move away from a culture of immediately triggering formal procedures and towards a model where managers are expected to actively resolve concerns at an earlier stage. For organisations already investing in mediation, manager capability and conflict resolution skills, the direction of travel will feel familiar. For others, it may require a significant change in approach before the new unfair dismissal regime arrives in 2027.

Clarification on the ‘right to be accompanied'

In Wolfe v Taka Mayfair Ltd, the Employment Appeal Tribunal (EAT) decision confirmed that an employee's statutory right to be accompanied at a disciplinary or grievance hearing only arises if the employee requests accompaniment.

The facts

Mr Wolfe had been employed as a head sommelier and manager for only a short period when, following a shift, he was called into a meeting with the restaurant owners. He was given no advance notice of the meeting's purpose and was dismissed at its conclusion. He later sought to bring a claim alleging that his statutory right to be accompanied had been breached.

The legal issue

Under section 10 of the Employment Relations Act 1999, two conditions must be satisfied before the statutory right to be accompanied arises:

• The employee must be invited or required to attend a disciplinary or grievance hearing.
• The employee must make a reasonable request to be accompanied.

Mr Wolfe accepted that he had never asked to be accompanied. He argued that he had been denied the opportunity to make such a request because the employer had not told him in advance that the meeting was disciplinary in nature.

The EAT's decision

The EAT rejected the claim and upheld the Employment Tribunal's decision.

The tribunal found that the wording of the legislation is clear: if the employee does not request to be accompanied, the statutory right does not arise. The EAT concluded that it could not read additional obligations into the legislation that Parliament had not included.

The EAT acknowledged the claimant's concern that an employer could potentially avoid the statutory right by failing to explain the nature of a meeting but stated that any such gap in protection would need to be addressed by Parliament rather than the courts.

Important practical point

The judgement does not mean employers can safely ambush employees in disciplinary meetings.

The EAT was only deciding whether there had been a breach of the statutory accompaniment provisions. It expressly recognised that failing to give advance notice of a disciplinary meeting or failing to inform an employee of their right to be accompanied could still be highly relevant when assessing the fairness of a dismissal.

What employers should know

Legally, an employer is not obliged under section 10 of the Employment Relations Act 1999 to proactively inform an employee of the right to be accompanied before the right arises. However, Acas guidance and good employee relations practice strongly support informing employees of that right when inviting them to disciplinary or grievance meetings.

For UK employers, the safest approach remains to:

• clearly identify when a meeting is disciplinary or grievance-related
• explain the potential outcomes
• inform the employee of their right to be accompanied
• allow a reasonable opportunity to arrange a companion
• document that this information was provided.

The key lesson is that the statutory right to be accompanied is employee-triggered, not employer-triggered. However, from an unfair dismissal and employee relations perspective, relying on the technicality that an employee did not ask for accompaniment would be risky. Tribunals are likely to look much more favourably on employers who clearly notify employees of their rights and provide a fair opportunity to exercise them.

Labour law updated to support flexible working and strengthen worker protections

Qatar has introduced wide-ranging labour law reforms through Law No. nine of 2026, aimed at modernising the country's employment framework, supporting business growth and improving worker protections. The reforms reflect changing workforce trends and are intended to enhance Qatar's attractiveness to investors and skilled professionals.

Flexible working arrangements formally recognised

One of the most significant developments is the formal recognition of part-time and freelance work within Qatar's labour framework. The reforms acknowledge the growing importance of flexible and platform-based working arrangements and create a legal foundation for these employment models, with additional regulations expected to follow.

Worker protections strengthened

The legislation introduces a range of measures designed to enhance employee protections. These include stronger wage protection requirements, increased oversight of compliance and improvements to labour market regulation. The government has stated that the reforms are intended to support both workforce welfare and sustainable economic development.

Labour disputes to be resolved more efficiently

Qatar has also sought to improve its dispute resolution system through expanded mediation mechanisms and greater use of digital processes. Labour dispute committee decisions will become directly enforceable, helping to increase confidence in the system and reduce delays in resolving workplace disputes.

Recruitment and labour market oversight tightened

The reforms introduce stricter licensing requirements and stronger penalties for recruitment agencies and labour providers. These changes are intended to improve service standards, strengthen regulatory compliance and enhance protection for workers entering the labour market.

Clearer rules on non-compete restrictions

The updated legislation also clarifies the rules governing non-compete clauses. The reforms seek to balance employers' interests in protecting confidential information, customer relationships and commercial interests against employees' ability to move freely within the labour market.

Greater focus on employee engagement

For larger employers, the reforms introduce requirements to establish joint employer-employee committees to encourage workplace dialogue and cooperation. The changes are intended to improve communication, address workplace concerns and support stronger employee engagement.

What employers should know

Employers operating in Qatar should review employment contracts, flexible working arrangements, recruitment processes and workforce policies to ensure compliance with the new framework. Businesses using freelance or part-time labour should pay particular attention to future regulations that will govern these new employment categories.