A daily briefing on European HR, labour law and compliance developments for SME HR teams across the EU, UK and Switzerland.

Top story: Germany unveils sweeping employment law reform package

On 2 July 2026, the German coalition committee agreed a comprehensive reform package titled “A Programme for Economic Recovery and Employment,” containing 34 measures that would significantly reshape German employment law. Among the most notable changes: employees will be required to submit a medical certificate from the first day of illness, replacing the previous rule that only required one after three calendar days. Sick leave certificates issued by telephone will no longer be permitted. Fixed-term employment contracts without objective grounds will be allowed for up to four years (up from two) with up to six extensions, for employees hired before 31 December 2030. A new termination mechanism for employees earning above approximately €177,450 per year would allow employers to end the employment relationship in exchange for a severance payment, even where a court finds the dismissal socially unjustified, taking effect from 1 January 2027. The coalition also plans to make it easier for companies with works councils to implement software and AI tools.

What to do: The measures still require Bundestag approval, but the direction is clear. HR teams at German operations should review their sick leave policies, fixed-term contract practices and AI implementation plans now, so they’re ready to act once the legislation passes.

Also developing

UK: From 1 July 2026, anyone hired on or after this date begins accumulating service towards the new six-month qualifying period for unfair dismissal protection, which replaces the current two-year threshold under the Employment Rights Act 2025. Anyone employed on or before 1 July will automatically gain protection when the new regime takes full effect on 1 January 2027. Separately, the government’s consultation on preventing misuse of non-disclosure agreements in workplace harassment cases closes on 8 July 2026. HR teams should tighten probation processes and review any standard NDA clauses in settlement agreements before the consultation deadline.

Netherlands: Several changes took effect on 1 July 2026. The Wet VBAR (Assessment of Employment Relationships Act) introduces a legal presumption of employee status for workers earning less than €36 per hour, with intensified enforcement. Organisations with 10 or more employees must now adopt a formal code of conduct against undesirable behaviour, covering bullying, harassment, discrimination and violence. Transition payment compensation from UWV is now restricted to businesses with fewer than 25 employees. Temporary workers are entitled to the same terms as comparable permanent staff after 52 weeks. SMEs using freelancers should review contractor relationships urgently.

Belgium: From 1 July 2026, the statutory notice period upon employer-initiated dismissal is capped at 52 weeks for new employment contracts, ending the previously uncapped accrual after 17 years of seniority. The longstanding prohibition on night work (between 20:00 and 06:00) has been abolished across all industries; night work can now be introduced via company-level collective agreements or amended working regulations. For the distribution sector, employees hired from 1 July onwards qualify for the night-work premium only for hours worked between 23:00 and 06:00. Employers should update employment contracts and working regulations accordingly.

France: A new paid parental leave of up to two months per parent became available from 1 July 2026 for children born or adopted from 1 January 2026. Parents of children born between January and May 2026 may use their entitlement until the end of 2026. Additionally, the employer contribution applied to mutually agreed terminations and employer-initiated retirements has increased from 30% to 40%. HR teams should update leave policies and factor the higher contribution into termination cost projections.

EU-wide, pay transparency: Only four of 27 member states (Slovakia, Italy, Lithuania and Malta) met the 7 June 2026 deadline to transpose the EU Pay Transparency Directive into national law. Larger economies including Germany, France, the Netherlands, Sweden and Denmark have missed the deadline, with several targeting 1 January 2027. Commissioner Hadja Lahbib has confirmed there will be no extension and that infringement proceedings under Article 258 TFEU may follow, with letters of formal notice expected later this year. Employers in late-transposing states should not wait: begin salary-range documentation and gender pay gap analysis now, as the Directive’s requirements will apply retroactively once transposed.

Op de radar

2 August 2026: The EU AI Act’s high-risk provisions take full effect, classifying employment-related AI tools (CV screening, candidate ranking, performance monitoring, termination decisions) as high risk. Employers using automated screening must ensure transparency, human oversight and conduct compliance audits.

25 August 2026: The UK government’s consultation on ending one-sided flexibility in zero-hours and similar contracts closes. Responses will shape forthcoming legislation.

1 January 2027: The UK’s new unfair dismissal regime takes full effect: employees with six months’ continuous service gain protection, and the compensation cap is removed. Germany’s planned high-earner termination mechanism is also targeted for this date, subject to parliamentary approval.

2 December 2026: Deadline for EU member states to transpose the Platform Work Directive, which introduces a presumption of employment for platform workers meeting certain criteria.

Bronnen

• Baker McKenzie: Germany’s planned significant changes to employment law (3 July 2026)
• Euronews: Germany’s Merz announces sweeping reforms (2 July 2026)
• RSM UK: Unfair dismissal rights for new recruits from 1 July 2026
• MBM Commercial: Key employment law change from 1 July 2026
• Houthoff: Netherlands employment law changes in 2026
• Ploum: Netherlands employment law changes in 2026
• Baker McKenzie: Belgium new employment law legislation (May 2026)
• Bird & Bird: Belgium employment law reforms on working time
• KMH Benefits: French social law 2026 key reforms
• Lewis Silkin: EU Pay Transparency Directive 2026 employer compliance
• Morgan Lewis: EU Pay Transparency Directive deadline has passed
• DLA Piper: Nordic Employment Law Bulletin, July 2026

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.