At a glance
- Regulation of AI in the workplace.
- Progress outside EU on pay transparency.
- China's employment law landscape refined.
- Developments across the US.
- Join our upcoming events.
Regulation of AI in the workplace
Regulation of the use of AI continues to be a hot topic across the globe. In Europe, Italy has passed laws setting a framework for ethical and transparent use of AI tools in the workplace. In Ireland, following governance rules under the EU AI Act taking effect on 2 August, 15 National Competent Bodies have been given responsibility for oversight and enforcement. Elsewhere, New South Wales plans to introduce new limitations on the use of AI in the workplace; Colorado extended compliance deadlines under the Colorado AI Act to 30 June 2026, allowing time for potential revisions; and new rules governing the use of AI and automated decision-making systems in employment practices took effect in California on 1 October 2025.
Progress outside EU on pay transparency
Although EU Member States only have until 7 June 2026 to transpose the Pay Transparency Directive into local laws, many countries have made little progress. The Finnish government's legislative proposal has been delayed, and the Dutch government has postponed implementation to 1 January 2027.
Pay transparency efforts continue to progress outside the EU. In Japan, new reporting requirements for companies with over 100 employees take effect on 1 April 2026; in New Zealand, protections for employees who choose to discuss their pay are now in force; and in South Africa, the Fair Pay Bill introduces changes to increase openness around remuneration, such as requiring salary ranges in job postings and allowing open discussion of pay among employees.
Focus: China's employment law landscape refined
China’s Supreme People’s Court Interpretation (II) has brought greater clarity to the employment law landscape, addressing key issues from the formation to the termination of labour relationships.
The Interpretation confirms that employment relationships may be recognised based on actual working arrangements, even without written contracts. Foreign representative offices can be named in disputes, and affiliated entities may face joint liability. Employers not formalising contracts risk double salary penalties.
Post-termination, the Interpretation further delineates circumstances where reinstatement is impossible and strengthens rules around non-compete agreements. New Ministry guidelines provide granular compliance standards for implementing non-competes, raising the stakes for employers navigating termination risks and contract obligations.
Focus: Developments across the US
At the federal level, President Trump signed a proclamation requiring a USD100,000 payment to accompany or supplement new applications for H-1B petitions; the Department of Labor released its regulatory agenda and announced its intent to rescind the prior administration’s independent contractor rule, which made it more difficult to classify workers as independent contractors; and the Federal Trade Commission dismissed its appeals of the Biden-era rule banning most non-competes, indicating it will take a targeted enforcement approach.
Employers continued to see new state laws, including in California and Illinois.
Attend: Join our upcoming events
Register for our Global employer briefing on 8 October 2025 for insights into significant legal and regulatory employment law developments from the past quarter and a look at what's ahead. Attend our Canada Employment and Labour Update on 23 October to hear about topics including mental health, harassment, gig workers, and pay transparency. On 13 November, in-house employment lawyers and HR leaders will converge in our London office for expert-led workshops and engaging discussions on the transformative role of AI in the workplace in our session on Mastering AI in the Workplace.
More to explore
