From pay transparency to the right to disconnect, HR leaders face a perfect storm of regulation, technology and rising expectations in 2026. What really matters, what’s overhyped and where should teams focus first? Veronique Lemaire cuts through the noise with practical insight for navigating change without losing people or momentum
The future of work is a red-hot topic as the global economy realigns amid developing regulations, rapid technological shifts and changing employee expectations. A third (34%) of jurisdictions predict an uptick in the complexity of HR and payroll services, according to the latest Global Business Complexity Index. This is driven largely by continuous legislative changes that multinationals operating across borders will find particularly challenging.
“Understanding – and reacting to – developments will dictate whether their organisation sinks or swims in choppy waters”
Global trends also indicate a growing emphasis on employee wellbeing and work-life balance. Almost all jurisdictions are now legally required to provide paid holiday and time off. Pension funds, maternity leave and paid sick days are all increasingly a legal requirement, but employees expect more – whether it’s flexible working, a free bowl of fruit or discounted gym memberships.
And they want a work culture that reflects the changing face of employment, whether that’s digital nomadism, digital assistants or the right to switch off digitally.
These forces are combining to put unprecedented demands on HR leaders and the L&D practitioners with whom they work. They must proactively monitor changes and adapt their strategies to remain compliant and align with work’s ‘new normal’.
With this in mind, here’s what they should pay close attention to over the next 12 months.
Staying on top of new obligations
As we move through the new year, it’s important to closely monitor new regulations and reporting standards that will impact a business.
From June 2026, for example, organisations across European Union (EU) member states will be obliged to introduce a range of measures to ensure transparency regarding pay. The key rules of the EU Pay Transparency Directive include disclosing pay ranges in job adverts, gender pay gap reporting for larger employers and mandating joint pay assessments.
As well as complicating compliance for corporates, this new directive has major implications for L&D teams, who will need to rethink recruitment processes and produce training materials, such as FAQs. They will need to brief talent acquisition teams about what can and can’t be asked, and line managers about the questions they can expect when it comes to the issue of pay equity.
We’re also seeing a push towards the ‘right to disconnect’ that will gather pace globally. While no overarching directive exists yet in the EU, the European Commission is actively working towards one,following calls to address the ‘always-on’ work culture.
In Australia, meanwhile, the Right to Disconnect law, part of the Fair Work Act, was extended to small businesses in August 2025, and we’re likely to see further clarifications and real enforcement actions in 2026. Such laws will become more commonplace and require L&D teams to consider knowledge management aspects of new legislation and how it will impact workforce management and planning.
Preparing for the shift towards ‘next generation’ HR compliance
In today’s data-rich business environment, governments are seeking digitalisation and real-time compliance. We’re seeing this in the UK with Making Tax Digital for Income Tax, which from April 2026 will require self-employed individuals with a qualifying income to provide quarterly updates to HMRC.
There are similar initiatives across several EU countries – including Germany, Spain and France – while New Zealand has Payday Filing and Brazil has eSocial. The move towards more integrated reporting is challenging existing HR and payroll processes and systems; there is a need for innovative solutions that provide real-time access to data to help firms comply with new obligations, and within stringent timelines.
L&D teams will also need to help strengthen data protection policies to protect employee privacy in a more digital HR environment. For example, frictions exist between complying with the EU Pay Transparency Directive and guaranteeing confidentiality obligations under GDPR. If someone wants to know what the person sitting next to them earns, how can managers provide that information withoutviolating data privacy? This needs careful consideration in 2026.
Building an engaging virtual culture
Prompted by the Covid-19 pandemic, many corporates embedded hybrid working policies within their organisation. People expect to work from home – and indeed digital nomads expect to be able to work from anywhere.
In 2025, however, we’ve seen a number of sectors, including the financial services industry, pushing back and ordering returns to the office. This isn’t popular. One study by King’s College London found just 42% of workers are willing to comply with a full-time office mandate, down from 54% in 2022.
The freedom to choose a work location is seen as a perk when choosing an employer, and equally the need to access the global talent pool to respond to skills shortages is crucial for many companies. This is illustrated by how well-established and accepted Employer of Record structures are compared to five years ago.
Gen Z is increasingly present in the employment market and a significant portion of this demographic has never known the traditional office set-up. How can L&D teams successfully mesh their needs with those of people who began their working lives in a ‘9 to 5’ office environment?
This is a complex riddle to solve for companies looking to integrate a diverse workforce (spanning contingent workers, different contract types and generations) while catering for different learning habits and preferences.
Relying solely on in-person interactions to build a company culture is no longer viable. L&D teams will need to draw on the latest technological tools, such as GenAI, to knit together a compelling virtual culture that keeps everyone engaged – regardless of whether they’re in a different room, city or country.
Providing the right mix of benefits
People are increasingly thinking beyond their salary and putting a greater emphasis on benefits packages. They expect their employer to support their physical and mental health, as well as their financial health.
Whether it’s private medical insurance, a wellbeing allowance or even simple walking meetings, benefits have become crucial. A study by Zest highlighted that 55% of 18 to 34- year-olds regard a good benefits package as the most important factor when searching for a job, with many willing to leave their current employer for one with a better proposition.
HR teams must balance two often contradictory dimensions. On one hand, there is an understandable desire to harmonise and offer the workforce the same employee experience, regardless of location and employment type. On the other, they must weigh up local sensitivities and attitudes. What may work well in the US or the UK, for example, won’t necessarily translate to Asia.
Without a thorough analysis of the expected outcomes of a rewards plan at a local level, and significant time spent preparing the launch plan and communications, the often significant investments made by companies may not yield the expected results – or, worse, be perceived negatively.
Adopting a responsible approach to AI
AI will play a more prominent role in HR in 2026, with a closer convergence of human and machine.
Companies need to define their approach and lay down a robust reference framework in their AI policy to ensure all initiatives can be measured against agreed efficiency, compliance and privacy benchmarks. This is the only route to responsibly harnessing the technology to augment human capabilities.
I recently spoke with a CHRO from a Spanish company with operations across Europe. The company prides itself on offering one-to-one training as part of its onboarding programme, but she was spending an unmanageable amount of time travelling to each market.
A joke with her boss about how she needed a clone prompted the development of a virtual avatar that is now used for inducting new hires. The avatar has been fed with all the relevant information by the L&D team, and when something new is launched she updates it. The result is a more efficient solution that’s significantly more engaging than outdated training videos and still provides that important human touch. It looks like her and has her knowledge – so a hire can prompt the avatar to tell them more about the company’s benefits package, for example, and it will answer accurately.
Whether it’s building an engaging virtual avatar, fostering a compelling virtual culture, or keeping a finger on the pulse of regulatory fluctuations, there’s a lot for HR professionals to think about.
Understanding – and reacting to – developments will dictate whether their organisation sinks or swims in choppy waters. A specialist provider with global reach and local knowledge can be a reliable buoyancy aid, reducing operational burdens and the risk of costly errors.
Veronique Lemaire is Head of Human Resources and Payroll Client Solutions for TMF Group
