Work/Life - international employment news update

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Issue 123

Welcome to the latest edition of our international employment news update.

In this edition we look at:

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Four consultations launched on Employment Rights Bill proposals

The UK Government has launched four key consultations on legislation under the Employment Rights Bill, expected to receive Royal Assent before the end of the year. The consultations cover trade unions' statutory right to access workplaces and employers' duty to inform workers of their right to join a union. Separate consultations address enhanced dismissal protections for pregnant workers and statutory unpaid bereavement leave. These reforms support the government’s broader 'Make Work Pay' agenda. The consultation deadlines fall between December 2025 and January 2026, offering employers the opportunity to provide feedback on the upcoming regulatory changes.

Germany grants retirees EUR2,000 tax-free earnings

Germany will allow pensioners who continue to work beyond the retirement age to earn up to EUR2,000 per month tax-free from 1 January 2026, as Chancellor Friedrich Merz tackles labour shortages threatening Europe's largest economy. This 'active pension plan' aims to address demographic pressures as 9% of the workforce prepare to retire by 2035.

The initiative forms part of the Germany's 'autumn of reforms' designed to mitigate the shrinking workforce and retain experience within companies. Whilst working after retirement is already permitted, the government seeks to make it more attractive through tax incentives. Whilst the measure is expected to cost the state almost EUR900 million per year, it promises to offer flexibility and financial gain for the ageing workforce. Questions remain about implementation and the potential impact on younger jobseekers.

Further immigration changes for sponsored UK workers

The UK Government has recently announced further changes to visa sponsorship requirements, with significant implications for employers. Notable changes include a 32% increase in sponsorship costs from 16 December 2025 as well as raised English language requirements starting from 8 January 2026. The graduate visa route will also be shortened from two years to 18 months, starting from 1 January 2027. Employers should note these developments to plan recruitment and compliance strategies ahead of implementation.

Netherlands labour shift: unemployment surpasses vacancies

For the first time in four years, unemployment in the Netherlands has overtaken the number of available job vacancies, marking a significant shift in the labour market. New data from the Dutch national statistics office, CBS, reveal that between July and September 2025, unemployment increased by 13,000 to 399,000, whilst open vacancies fell by 2,000 to 387,000. This is the first time since 2021 that job seekers outnumber available positions, reflecting a cooling market following persistent staff shortages.

Greece extends working day under new labour law

Greece has passed a controversial new labour law allowing employees in certain sectors to work up to 13 hours per day, citing the need for greater flexibility in a modernising economy. The law permits workers to hold a second job, provided their combined working hours do not exceed 78 hours per week. The government states that the reform will reduce undeclared work and align Greece’s framework with other EU labour markets. However, unions have warned that the measure risks increasing burnout and undermining collective bargaining protections. Employers should monitor how flexibility provisions interact with existing Working Time Regulations and ensure contractual agreements reflect compliance with any secondary employment arrangements.

UK employers warned about workplace health support

More than 3.3 million adults are projected to become economically inactive by 2035 due to long-term health conditions, warns the Royal Society of Public Health (RSPH). Without a fundamental 'recalibration' of workplace health support, an additional 600,000 people could leave the workforce in the next decade, costing the economy an estimated GBP36 billion annually. These stark figures have been released ahead of the Mayfield report, Keep Britain Working, due to be published this week with recommendations for addressing the issue.

Mental ill health remains the leading cause of both short- and long-term absences, driving record-high sickness rates. Previous RSPH analysis indicates that nearly half of workers lack access to essential health services like routine checks and winter flu vaccinations, with lower-paid sectors such as hospitality and agriculture disproportionately affected.

UK businesses retreat on DEI following US pressure

Over half of UK businesses are revising their diversity, equity and inclusion (DEI) initiatives in response to the Trump administration's challenges. A survey of 250 general counsels and chief legal officers at organisations generating over GBP100 million found that 28% have made comprehensive changes to DEI and sustainability programmes, or abandoned them entirely, whilst a further 26% have implemented modifications. The findings expose how US political developments are reshaping corporate behaviour in Britain, despite different legal frameworks. Major US corporations have already scrapped DEI policies following Trump administration pressure.

The rise of AI-assisted grievances: a new challenge for employers

UK employers are reporting an increased number of employees turning to artificial intelligence to draft detailed, 'lawyerly' grievances. Whilst AI tools may be able to help structure employee concerns more clearly, they often generate overly lengthy, complex complaints that may include excessively formal language, exaggerated claims, irrelevant or non-existent legal references. Experts warn that this may extend investigation timelines, increase costs, and create additional strain on HR teams.

Training managers to spot AI involvement and maintaining robust and proportionate grievance handling processes can help to navigate these difficulties. Ultimately, employers must balance thoroughness with pragmatism to manage this new challenge as AI becomes more embedded across the spectrum of workplace processes.

Services and Groups Employment, pensions & mobility