Welcome to the May 2026 edition of the Global Employment Tax and Compliance Newsletter.
This month, we cover employment, payroll, labour law, social security, employment tax and immigration changes that moved in May 2026.
The focus is on updates that matter to companies employing people internationally: working time reform, wage payment rules, labour code implementation, workplace safety duties, work authorisation, permit filing, social security rules and employer-backed immigration processes.
Each entry explains what changed, why it matters, and how it may affect hiring, payroll, mobility or local employment setup.
European Union: Social Security Rules for Mobile Workers Move Closer to Reform
The EU moved another step closer to updating its social security coordination rules, after the European Parliament’s Employment and Social Affairs Committee backed the provisional agreement on 6 May 2026.
These rules matter when employees live, work or are posted across EU borders. They help determine which country’s social security system applies, how benefits are coordinated, and how Member States cooperate when workers move between jurisdictions.
For employers, the relevance is mainly in posted-worker and multi-country employment scenarios. The reform is expected to clarify parts of the system covering unemployment benefits, family benefits, long-term care benefits and applicable social security rules for mobile workers.
This is not yet a live compliance change. The agreement still needs formal adoption by the EU institutions before the revised rules apply. For now, it is a watch item for employers managing EU mobility, postings or employees working across more than one Member State.
Mexico: 40-Hour Week Moves into Labour Law
Mexico published its Federal Labour Law reform on 1 May 2026, giving practical shape to the country’s move from a 48-hour to a 40-hour working week.
The change will not happen overnight. The 48-hour cap remains in place for the rest of 2026, then reduces by two hours each year from 2027 until it reaches 40 hours in 2030. The important point for employers is that salaries, wages and benefits cannot be reduced because ordinary working hours are reduced.
That makes 2026 the preparation year. Employers with Mexico-based employees need to look beyond the headline workweek number and review how the change will affect shift design, overtime reliance, payroll cost, employment contracts, internal work rules and time-recording systems.
The reform also moves working-time compliance in Mexico towards stronger evidence. Electronic timekeeping is expected to become mandatory from January 2027, which means informal or incomplete records will become harder to defend.
Georgia: Work Authorisation Becomes a Formal Requirement
Georgia’s new labour migration framework is now changing how foreign nationals work in the country.
Since 1 March 2026, most foreign nationals working in Georgia need a formal right-to-work approval, whether they are employed by a local company or working on a self-employed basis. For employees, the application is made through the local employer. For self-employed foreign nationals, the application is made directly.
The May relevance is the transition from introduction to enforcement. From 1 May, enforcement mechanisms for some self-employed foreign nationals already in Georgia were activated, while foreign nationals who were already registered in the labour migration system before 1 March have until 1 January 2027 to regularise their status.
For employers, the important change is that a Georgian residence permit or visa status is no longer enough on its own to prove the right to work. Employment now needs to sit within the labour migration process: vacancy publication where required, employer application, right-to-work approval, and alignment with the correct residence or visa route.
India: Final Rules Give Shape to Labour Code Implementation
India moved its long-running labour code reform forward in May, when the Ministry of Labour and Employment notified the final Central Rules under the four Labour Codes on 8 May 2026.
The rules cover wages, social security, industrial relations, and occupational safety and working conditions. They do not remove India’s central-state complexity, but they make the central framework more concrete in areas such as wage definitions, working time, overtime, statutory records, social security, contract labour, maternity benefits, crèche duties and workplace safety.
The significance for international employment is that India’s reform is no longer only a consolidation of older labour laws. It is beginning to define how employment terms, payroll components, contractor use and workplace obligations will be administered where the central rules apply.
Brazil: Psychosocial Risk Enters Workplace Safety Compliance
Brazil’s updated NR-1 requirements take effect in May 2026, bringing psychosocial risk into the country’s formal occupational risk management framework.
NR-1 is Brazil’s general workplace health and safety standard. The update requires employers to include work-related psychosocial risk factors in their Occupational Risk Management Programme, alongside other recognised workplace risks.
The significance is that mental health risk is being treated as part of employer safety governance, not only as an HR or wellbeing topic. Issues such as excessive workload, harassment, conflict, pressure and work organisation may now need to be assessed through the same compliance logic used for other occupational risks.
For Brazil-based employment, this changes how workplace risk is documented and managed. The employer record will need to show not only that psychosocial risks were acknowledged, but how they were identified, assessed and addressed within the wider safety framework.
Brazil: Psychosocial Risk Enters Workplace Safety Compliance
Brazil’s updated NR-1 requirements take effect in May 2026, bringing psychosocial risk into the country’s occupational health and safety framework.
NR-1 is Brazil’s general workplace risk management standard. The update requires employers to consider work-related psychosocial factors within the Occupational Risk Management Programme, alongside physical, chemical, biological, ergonomic and accident-related risks.
The important shift is that issues such as excessive workload, harassment, conflict, pressure, isolation or poor work organisation are no longer only HR concerns. Where they arise from the way work is structured or managed, they may now fall within formal workplace safety assessment.
For employers with Brazil-based staff, the update expands the compliance lens beyond contracts, payroll and statutory benefits. The working environment itself now needs to be considered as part of occupational risk management.
UAE: Wage Protection Rules Move to a Fixed Monthly Deadline
The UAE issued Ministerial Resolution No. 340 of 2026 in May, introducing a tighter Wage Protection System framework from 1 June 2026.
Under the new rules, private-sector wages for the previous Gregorian month must be paid by the first day of the following month through the Wage Protection System or another approved payment channel. Payments made after that date are treated as delayed.
The Wage Protection System is the UAE’s official salary-payment monitoring system. It links wage transfers to labour compliance, allowing the authorities to track whether private-sector employers are paying workers correctly and on time.
The May resolution also raises the wage-transfer compliance threshold from 80% to 85% and introduces a more structured escalation process for late or incomplete wage payment.
For employers, the notable change is the loss of flexibility around pay timing. UAE payroll can no longer be managed as a broad monthly cycle with room for informal delay. The payment date, approved payment route and transfer evidence now sit closer to the centre of labour compliance.
China: Beijing Tightens Union Notice Rules for Termination
Beijing’s amended trade union implementation measures took effect on 1 May 2026, adding a stricter procedural step for unilateral employee terminations.
Where an employer intends to terminate an employment contract unilaterally, it must notify the company trade union of the reasons at least five working days in advance. If the company has not established its own trade union, the notice must go to the higher-level trade union.
This is a Beijing-specific change, not a national China rule. Its importance is procedural. In a termination case, the legal basis for dismissal is only part of the risk. The employer also needs to show that the required consultation and notification steps were followed before the decision was implemented.
The change matters most where employers are managing performance exits, restructuring, redundancy, misconduct cases or end-of-contract disputes in Beijing. It makes union notification a defined part of the termination timeline, rather than something handled loosely at the end of the process.
Netherlands: Single Permit Rules Give Foreign Workers More Mobility
The Netherlands updated its Single Permit guidance on 22 May 2026, reflecting the revised EU framework for third-country nationals who live and work in an EU Member State.
The Single Permit combines residence and work authorisation in one permit. In the Netherlands, it is used for specific paid-employment categories where a combined residence and work route is required.
The notable change is the position of the worker after employment ends. A Single Permit holder now has up to three months to find a new job while the permit remains valid. If the person has held the permit for two years or longer, the job-search period can extend to six months.
The employer-change process also becomes more defined. The previous employer must deregister the worker with the IND, and the new employer must apply for the new residence permit.
For employers, this makes the Single Permit less static than a traditional employer-tied route: the employment relationship still matters, but loss of one job no longer automatically removes the worker from the Dutch labour market.
Belgium: Work Permit Filing Moves Further into the Digital System
Belgium moved more work permit filings into its digital process in May. Since 4 May 2026, work authorisation applications for non-European nationals in the Brussels-Capital Region must be submitted through the federal one-stop portal, with PDF forms and email submissions no longer accepted. The federal Working in Belgium portal also confirms that single permit applications are submitted online and routed to the competent region.
The change is procedural, but not minor. For employers, the filing route is now part of the compliance process. A correct application is no longer only about the worker, the role and the supporting documents. It also depends on whether the employer or authorised representative has the right portal access, mandate and submission route in place.
This matters particularly for short assignments, commuter work and time-sensitive mobility cases, where delays often come from process rather than eligibility. Belgium is moving away from fragmented email-based filing and towards a more controlled digital work-authorisation system, where incomplete access or an invalid mandate can slow the case before the substance is even reviewed.
Poland: CUKR Card Opens for Ukrainian Temporary Protection Holders
Poland opened the CUKR residence card procedure on 4 May 2026 for eligible Ukrainian citizens with PESEL UKR status.
The CUKR card is a temporary residence card marked “previously held temporary protection”. It is issued for three years and allows eligible holders to live and work in Poland without a separate work permit. Applications must be submitted electronically through the MOS case-handling portal.
For employers, the relevance is labour-market status. PESEL UKR has allowed many Ukrainian citizens to live and work in Poland under temporary protection, but it remains a protection-based status. CUKR creates a more formal residence document for eligible people who move from temporary protection into temporary residence.
This does not replace normal right-to-work checks, but it may simplify employment handling where a worker holds the new card. The employee’s right to work is attached to the residence card itself, rather than a separate permit or employer notification route.
United States: Overtime Threshold Reverts After Court Challenge
The US Department of Labour issued a technical amendment in May confirming the federal overtime exemption threshold for most white-collar employees.
Under US wage law, many employees are entitled to overtime pay when they work more than 40 hours in a week. Certain executive, administrative and professional employees can be exempt, but only if they meet the duties test and are paid at least the required salary level.
A 2024 federal rule attempted to raise that salary level, but it was later struck down by the courts. The May amendment removes the blocked 2024 rule from the federal regulations and restores the 2019 threshold: USD 684 per week for most executive, administrative and professional exemptions.
The federal salary threshold is back to the lower 2019 level, but overtime classification still depends on the employee’s actual duties, not salary alone. State rules may also set higher thresholds.
Canada: Ontario Makes Employer-Backed Immigration More Controlled
Ontario’s immigration system changes take effect on 30 May 2026, reshaping how the Ontario Immigrant Nominee Program handles employer-supported applications.
The Ontario Immigrant Nominee Program allows the province to nominate foreign workers, graduates and other candidates for permanent residence where they meet Ontario’s labour market needs. The May changes revoke the existing stream categories and give Ontario more flexibility to use targeted selection.
For employers, the important part is the employer-backed process. Job offers now sit within a more controlled verification structure. Where a nomination depends on an Ontario job offer, the employer must be registered and the position must be submitted through the programme process before the candidate can rely on that offer.
Why Global Employment Demands Human Judgment
By Abid Hamid, Group CEO, Acumen International
Abid Hamid writes about a risk that has become more visible as global employment platforms mature: companies can now move faster than their understanding of the country, role and employment obligations involved.
The article argues for a more balanced approach. Technology is essential for visibility and execution, but it should not be mistaken for employment judgement.
The difficult cases are not solved by faster processing; they require careful reading of local labour law, immigration, payroll, benefits, role authority and commercial context before a hiring model is chosen.
Acumen’s value sits in that balance: digital capability supported by experienced people who can recognise when a standard process is enough and when the case needs deeper assessment and local knowledge.
Employer of Record Licensing: A Guide to Regulated Hiring and Co-Employment
We wrote this because EOR coverage claims can hide the more important question: what legal model is actually being used in that country?
In some markets, the same commercial setup may fall under employee leasing, worker dispatch, labour hire, temporary agency work, PEO or co-employment rules. That can change the licence requirements, assignment limits, pay conditions, immigration basis, shared liability and due diligence risk.
Global EOR: A Practical Guide to Hiring Abroad
This guide explains how Global EOR works, when it is useful, and where its limits sit.
It covers the split between the EOR’s legal employer role and the client’s day-to-day control of the employee, then compares EOR with contractors, local entities, global payroll and HR outsourcing.
The article is useful for employers deciding whether EOR is the right model for a specific country, role or expansion plan, especially where immigration, contractor conversion, senior hires, M&A transitions or permanent establishment risk need closer review.
Doing Business and Hiring in Georgia in 2026. Employer Guide
This article positions Georgia as a specific regional hiring and market-entry location, not a generic low-cost employment destination. Its value sits in its role between Europe, Türkiye, the South Caucasus, the Black Sea and Central Asia, which makes it relevant for logistics, finance, technology services, regional operations and project-based roles.
The guide explains the employment choice foreign companies face in Georgia: local entity, Employer of Record or contractor engagement. The 2026 work-authorisation changes make that decision more important, especially for foreign-national hires, first employees, contractor-to-employee conversion and roles that need local employment support before a wider entity decision is justified.
Moving into June
Thank you for reading the May 2026 edition of the Global Employment Tax and Compliance Newsletter.
We will continue to monitor employment tax, labour law, payroll and immigration developments that matter to international hiring and workforce planning.
Until next month.