EU AI Act

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: EU AI Act transparency rules now enforceable as high-risk employment obligations gain extra time The EU's Digital Omnibus on AI (Regulation 2026/1744), published in the Official Journal on 24 July and in force since 27 July, landed just days before the AI Act's 2 August milestone. The amendment delays the high-risk compliance obligations that apply to employment-related AI systems (recruitment, candidate screening, performance evaluation, task allocation, worker monitoring and termination decisions) from 2 August 2026 to 2 December 2027. However, two sets of obligations took effect on schedule and are now enforceable. First, the Article 50 transparency obligations became binding on 2 August. Deployers of AI systems must inform individuals when they are interacting with AI, and must label deepfakes and AI-generated content intended to inform the public. The European Commission published detailed guidelines on transparency obligations and a voluntary Code of Practice on Transparency of AI-Generated Content on 31 July. Non-compliance can attract fines of up to €15 million or 3% of worldwide annual turnover, whichever is higher. Second, the AI literacy obligation under Article 4, which has been in force since February 2025, becomes enforceable from 3 August, the date by which member states must have established national market surveillance authorities and set penalties. Under the Omnibus amendment, the wording has been softened: organisations must now "support the development" of AI literacy among staff, rather than guarantee a specific level. What to do: SME HR teams using any AI tools (CV screening, chatbots, interview scheduling, performance analytics) should act on two fronts. First, audit current deployments against the transparency obligations already in force: can affected individuals tell when they are interacting with AI? Second, use the breathing room to December 2027 to begin preparing for the heavier high-risk requirements (risk assessments, bias testing, human oversight, technical documentation) that will apply to recruitment, evaluation and termination systems. The delay is not a reprieve; it is preparation time. Also developing Portugal: A draft bill partially transposing the EU Pay Transparency Directive was published on 5 August in the official Labour and Employment Gazette (BTE). Social partners have 20 days to comment. The bill requires employers to disclose salary ranges to job applicants before contract signing and bans asking candidates about salary history. Pay gap reporting will be annual for employers with 250 or more employees (starting 7 June 2027), triennial for those with 150 to 249 (also from 7 June 2027) and triennial for those with 50 to 149 (from 7 June 2031). Where unjustified pay gaps are identified, the labour inspectorate (ACT) can require a joint pay assessment with employee representatives within 90 days. Pay confidentiality clauses in contracts or collective agreements will be void. Protection against retaliatory dismissal is extended from one to three years after a complaint. What to do: Portuguese employers with 50 or more employees should begin building the pay data infrastructure needed for reporting. Review existing contracts for pay secrecy clauses that will become unenforceable, and prepare recruitment processes to include salary range disclosure. Denmark: Two landmark industrial arbitration awards issued on 4 February 2026 established that part-time employees are entitled to overtime pay from the point they exceed their agreed working hours, not only when they pass the full-time threshold. The tribunals found that the previous practice, under which part-time workers received no overtime supplement until they exceeded full-time hours, is incompatible with the EU Part-Time Work Directive (97/81/EC). Although the decisions directly apply to the challenged collective bargaining agreements, they apply in principle to all CBAs with similar provisions. Crucially, retroactive claims may extend back to 2001, when Denmark transposed the Directive. The Danish government has tasked a working group with proposing regulatory changes by 1 September 2026. What to do: Danish employers with part-time staff should review overtime payment practices and collective bargaining terms immediately. Assess potential exposure to retroactive claims and adjust payroll so that part-time employees receive overtime pay for hours worked beyond their agreed schedule, not just beyond the full-time threshold. EU-wide: The Pay Transparency Directive transposition deadline passed on 7 June 2026, and most member states missed it. As of mid-August, only five countries have fully transposed: Italy, Slovakia, Lithuania, Malta and Greece. Estonia partially transposed in July. Portugal's draft bill (see above) is under consultation, and Denmark published its draft in February with final legislation expected to enter into force on 1 January 2027. The European Commission has ruled out an extension. The first pay gap reports are due by 7 June 2027 for employers with 150 or more workers, covering 2026 data. What to do: Employers operating across multiple EU member states should not wait for national transposition. The Directive's core requirements (salary range disclosure, ban on pay history questions, pay gap reporting) are clear. Start collecting the data, benchmarking pay structures and training recruiters now. On the radar Portugal pay transparency consultation: Closes approximately 25 August 2026. Denmark overtime working group: Proposals for regulatory changes to part-time overtime rules due by 1 September 2026. Netherlands Staatsblad publication deadline (previously covered): Legal presumption of employment act must be published by 31 August 2026 for the 1 January 2027 entry into force to hold. UK electronic union balloting (previously covered): Takes effect 25 August 2026. UK zero-hours contracts consultation (previously covered): Closes 25 August 2026. Spain flexible retirement (previously covered): Royal Decree 416/2026 takes effect 28 August 2026. Ireland My Future Fund opt-out (previously covered): Window closes at the end of August 2026. EU Platform Workers Directive (previously covered): Member states must transpose by 2 December 2026. Sources DLA Piper: Deployer obligations under the AI Act, implications for employers from 2 August 2026 White & Case: EU AI Omnibus enters into force, amending the AI Act Cooley: EU AI Act transparency obligations take effect 2 August 2026 Jones Walker: Yes, August 2 still matters: the EU approved a high-risk AI delay, but most transparency obligations remain VdA: HR Future Legal Highlights, special edition on the transposition of the Pay Transparency Directive (Portugal) Ius Laboris: EU Pay Transparency Directive, which countries have transposed Morgan Lewis: EU Pay Transparency Directive, the deadline for transposition has passed NJORD Law: Part-time employees entitled to overtime pay at an earlier stage (Denmark) WTW: Denmark, part-time employees and entitlement to overtime pay Bird & Bird: New interpretation of the rules on overtime pay for part-time employees (Denmark) 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.