A daily briefing on European HR, labour law and compliance developments for SME HR teams across the EU, UK, Switzerland and the Nordics.
Top story: Spain’s flexible retirement reform takes effect on 28 August, opening the door to self-employment for retirees
Royal Decree 416/2026, published in May and effective from 28 August 2026, significantly expands Spain’s flexible retirement framework. The most notable change is that retirees receiving a contributory retirement pension may now combine it with self-employment (trabajo autónomo), provided they have not been registered as self-employed in the three years before retirement. Until now, flexible retirement was available only to those taking part-time employed work.
The reform also widens the permitted part-time working range for employed retirees from the previous 25% to 75% band to a new 33% to 80% band relative to comparable full-time hours. A new incentive rewards retirees who wait at least six months after retirement before re-entering the labour market: those working 55% to 80% hours receive a 25% pension top-up, and those at 33% to 55% receive a 15% top-up. For self-employed retirees, the compatible pension is set at 25% of the full entitlement.
What to do: Employers in Spain should review any workforce planning that involves rehiring retired workers or engaging them as freelancers. The three-year self-employment gap requirement means this route is not available to recently retired autónomos returning to the same activity. HR teams should also update internal guidance on flexible retirement options, as the wider working-hours band and new incentives may make the arrangement more attractive to former employees considering a return.
Also developing
EU: Whistleblowing Directive protections now formally cover AI Act violations. Since 2 August, employees and other reporting persons who flag breaches of the EU’s Artificial Intelligence Act through internal or external channels are protected against retaliation under the Whistleblower Directive (2019/1937). The European Commission has also launched a dedicated whistleblower tool for reporting AI Act infringements directly to the AI Office. This matters for any employer using AI-driven tools in recruitment, performance monitoring or workforce management: an employee who reports suspected non-compliance now has the same statutory protection as those reporting financial fraud or data breaches. What to do: If your organisation uses AI tools covered by the AI Act, update your internal whistleblowing policy and channel documentation to reference AI Act violations explicitly. Ensure reporting persons in your organisation (employees, contractors, trainees) know that AI-related concerns are now a protected disclosure category.
CJEU (cross-border): The Court of Justice ruled on 9 July in Case C-768/24 (Hortis v France Travail) that a court applying the Rome Convention’s choice-of-law rules for employment contracts may conclude that the law chosen by the parties is also the law of the country most closely connected with the contract, even where the employee habitually works in a different country. The case involved a French-resident employee working remotely for a Swiss employer under a Swiss-law contract. The Court held that objective factors such as salary currency, social insurance affiliation and tax regime may support the escape clause, but the choice of law itself is not a connecting factor. What to do: SMEs employing remote workers across borders should be aware that a choice-of-law clause alone does not guarantee the chosen law will apply. The mandatory employment protections of the country where the employee habitually works remain the default unless the contract, taken as a whole, is more closely connected with another country. Review cross-border remote work arrangements to understand which country’s dismissal, notice and working-time rules actually apply.
Switzerland: The Federal Court validated municipal minimum wage ordinances for Zurich (CHF 23.90 per hour) and Winterthur (CHF 23.00 per hour) in rulings published on 12 May, overturning the cantonal Administrative Court’s previous invalidation. The Federal Court held that the regulations fall within municipal autonomy and do not conflict with cantonal or federal law. These rates apply to most private-sector employment relationships where the work is performed primarily within the respective city. With Geneva (CHF 24.59), Neuchâtel (CHF 21.35), Jura (CHF 21.40), Ticino (CHF 20.00 to 20.50) and Basel-Stadt (CHF 22.20) already enforcing cantonal minimums, Switzerland’s minimum-wage patchwork now extends to two of its largest cities. What to do: Employers with staff in Zurich or Winterthur should check that all hourly rates meet the new floors. The exact implementation dates depend on the municipal authorities, but the legal basis is now settled and employers should not wait for further court challenges before adjusting payroll.
On the radar
UK electronic union balloting (previously covered): Takes effect 25 August 2026.
UK zero-hours contracts consultation (previously covered): Closes 25 August 2026.
EU Platform Workers Directive (previously covered): Member states must transpose by 2 December 2026.
EU-OSHA mental health campaign (previously covered): Official launch scheduled for October 2026.
Sources
- Garrigues: Flexible retirement, more incentives and new formulas from 28 August 2026
- Allen & Overy Shearman: Spain employment update, active retirement reform to pay transparency
- Mondaq: New pressure, new delays, the EU’s double move on AI and whistleblowing
- European Commission: AI Act whistleblower tool
- AllVoices: EU Whistleblowing Directive 2026 compliance guide
- EAPIL: CJEU on escape clause in employment contracts in Hortis (July 2026)
- Bär & Karrer: Swiss Federal Supreme Court upholds Zurich and Winterthur minimum wages
- MME: Minimum wage in Switzerland on the rise
Europe HR Compliance Pulse is an informational summary of publicly reported legal and regulatory developments. It is not legal advice. Always confirm obligations for your specific situation and market with a qualified adviser.
