Welcome to the August edition of the Global Employment Tax and Compliance Newsletter.
When you employ people across borders, the challenge is not finding employment updates. It is working out which ones affect your payroll, contracts, hiring plans or existing workforce.
Each month, we review developments across the 190+ countries where Acumen supports employment and narrow them down to the changes with a practical consequence for international employers.
This month, that includes employer contribution rates, notice periods, wage enforcement, work permit thresholds and new leave entitlements across Europe, the Gulf, Asia-Pacific and Latin America.
European Union: AI Transparency Rules Take Effect
From 2 August 2026, Article 50 of the EU AI Act began applying, bringing new transparency duties for certain AI systems and AI-generated content.
People must be informed when they are interacting directly with an AI system unless that interaction is obvious from the context. Providers and deployers also face new requirements around identifying synthetic or manipulated content, including deepfakes and some AI-generated text published in the public interest.
For employers, the change is relevant where AI is used in candidate or employee-facing tools such as chatbots, virtual assistants and automated communication. The separate rules for high-risk AI used in recruitment and employment remain subject to the revised implementation timetable.
Japan: Immigration Fees Rise Sharply from October
On 25 August 2026, Japan approved a major increase in fees for residence-status procedures, taking effect on 1 October. Fees for changing or extending a status of residence will move from the current flat JPY 6,000 for in-person applications to a tiered system ranging from JPY 10,000 to JPY 75,000, depending on the period of stay granted. Online applications will generally carry lower fees.
The fee for permanent residence will rise much more sharply, from JPY 10,000 to JPY 200,000. Companies supporting foreign hires will need to factor the higher government charges into immigration and relocation budgets.
Saudi Arabia: Wage Clauses Become Directly Enforceable
From 6 August 2026, the wage clause in open-ended employment contracts registered on Qiwa became directly enforceable, completing the final phase of Saudi Arabia’s rollout. Employees can apply through Najiz where wages remain unpaid for 30 days or partially unpaid for 90 days, without first bringing a labour claim.
For employers, this makes accurate alignment between contractual salary terms, payroll and Wage Protection System reporting increasingly important.
Belgium: One-Week Notice Period for New Indefinite Contracts
From 1 August 2026, either party can terminate a new indefinite-term employment contract with one week’s notice during the first six months of employment. The rule applies to contracts whose performance starts on or after that date; existing contracts are unaffected.
The change replaces the previous graduated notice scale and applies equally to employer dismissals and employee resignations. Other dismissal protections remain unchanged.
South Korea: Short-Term Childcare Leave Takes Effect
From 20 August 2026, employees in South Korea can take one or two weeks of short-term childcare leave when an unexpected or temporary care need arises, including school or childcare closures, school holidays, a child’s hospitalisation or suspension from attendance because of an infectious disease.
The leave can be taken once per year for each eligible child and is paid under the existing childcare-leave benefit rules. Time taken counts towards the employee’s overall childcare-leave entitlement, but does not reduce the number of times regular childcare leave can be split.
Chile: Employer Pension Contribution Rises to 3.5%
From August 2026 remuneration, Chile’s employer pension contribution rises from 1% to 3.5%, with payment due in September. The new rate is split between the employee’s individual pension account, the protected-return contribution and the Social Security Pension Fund.
The full 3.5% cannot be deducted from employee wages. Part of the new rate also incorporates the disability and survivors’ insurance contribution employers were already paying separately, so the increase in actual employer cost is lower than the headline 2.5 percentage-point rise.
Malaysia: Labour Market Test Threshold Rises
From 7 August 2026, Employment Pass roles paying below MYR 20,000 may need to go through the MyFutureJobs labour market test before the application can move ahead. The previous exemption threshold was MYR 15,000.
That means roles in the MYR 15,000–19,999 range can now require local advertising and interviews first, adding extra steps to the hiring process. Only base salary counts towards the threshold; allowances, bonuses and housing do not.
Bulgaria: Social Security Cap Rises
From 1 August 2026, Bulgaria’s maximum monthly social security base increased from EUR 2,111.64 to EUR 2,300. Contribution rates have not changed, but employers will pay contributions on a larger portion of earnings for employees above the previous ceiling.
Minimum insurance bases for most economic activities and occupational categories also increased from the same date, making August payroll the first affected by the new thresholds.
Fiji: Employer Provident Fund Contribution Falls to 8%
From 1 August 2026, Fiji’s mandatory employer contribution to the Fiji National Provident Fund fell from 10% to 8%, following the 2026–2027 National Budget. The employee contribution remains unchanged at 8%.
For employers, the change reduces the statutory FNPF cost from August payroll onwards, while leaving employee deductions unchanged. Employers can still contribute above the mandatory rate through additional employer contributions, so existing arrangements that provide a higher contribution can continue.
New Zealand: Employment Leave Act Becomes Law
New Zealand’s Employment Leave Act received Royal Assent on 6 August 2026, setting the country on course to replace the Holidays Act from 6 August 2028.
The new law changes how annual holidays, sick leave and other statutory leave are calculated and paid, with the aim of simplifying rules that have created persistent payroll complexity for employers. It also introduces new eligibility and accrual rules that will require changes to payroll systems, employment agreements and internal leave policies before implementation.
The two-year lead-in gives employers time to prepare, but businesses with large or complex payrolls will need to start reviewing how the new rules affect their current processes well before 2028.
Argentina: Minimum Wage Rises Again in August
From 1 August 2026, Argentina’s statutory minimum wage increased from ARS 372,400 to ARS 376,600 per month for employees working the full legal working day. The hourly minimum rose from ARS 1,862 to ARS 1,883.
The August increase is the latest step in the monthly schedule set for 2026. Employers need to reflect the new floor in August payroll and review salaries that sit close to the statutory minimum, including proportional rates for employees working reduced hours.
Notice Periods Guide: Rules, Costs and Employer Obligations
Notice periods vary widely across countries and can depend on statutory rules, contracts, collective agreements, tenure and the reason employment ends. The stated notice period is only part of the picture: dismissal procedures, garden leave, payment in lieu, benefits, leave and severance can all affect the real cost and timing of an exit.
Our latest guide compares notice rules across major markets and looks at what they mean for workforce planning and Global EOR arrangements, where the legal employer must manage the termination process and remain responsible for employment obligations until the relationship legally ends.
VAT in Global EOR: The Cost Missing from Too Many Quotations
When companies compare Global EOR quotations, VAT, GST and other indirect taxes can make a much bigger difference than the management fee alone. In some jurisdictions, tax may apply not only to the provider’s fee but to the wider employment-cost recharge, including salary and employer contributions.
Our latest article looks at how indirect-tax treatment varies across countries, why “pass-through” costs are not automatically outside the taxable base, and what clients should examine before comparing providers: the taxable amount, invoicing route, reverse-charge treatment and, crucially, how much of the tax they can recover.
Collective Bargaining Agreements in Global Employment
An employment contract does not always contain the full set of terms governing an international hire. Collective Bargaining Agreements can affect pay, classification, working time, benefits, notice and other employment conditions, sometimes even where the employer has not negotiated the agreement directly.
Our latest article explains how CBA coverage is determined, why employee classification can change both remuneration and employment cost, and how collective bargaining systems differ across countries including France, Spain, Italy and Sweden. It also looks at what employers should establish before making an offer where collective terms may apply.
Cyprus in 2026: A Strategic Hub for Global Expansion
Cyprus’s business case is changing. EU membership, tax advantages and an established professional-services sector remain important, but 2026 growth is being shaped by investment and M&A across technology, financial services, shipping, construction and energy.
Our latest article looks at where capital and hiring demand are moving, how Cyprus is opening access to international specialist talent, and why the country is becoming relevant on both sides of expansion: for foreign companies building teams in Cyprus and for Cyprus-based businesses hiring into new markets abroad.
Looking Ahead
This month’s developments show how quickly the cost, timing and compliance requirements of international employment can change from one market to another.
That is why global hiring decisions need to be grounded in the local employment position at the point the hire is made, not based on assumptions carried over from another country or an earlier stage of expansion.
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