Key Challenges Facing Employers in 2026

Major employment reforms are coming in 2026, and many employers have already begun preparing. Melanie Crowley, Partner and Head of Employment Law & Benefits, highlights the three big themes for next year, namely pay transparency, platform workers and age. Melanie explains how each will transform compliance, recruitment and workforce planning.

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Three things we expect employers will be talking a lot about in 2026 are:

1. Pay transparency
2. Platform workers, and
3. Age

Pay transparency

The Pay Transparency Directive is supposed to be implemented by the Irish government by June 2026. Once implemented, it will significantly change how employers approach recruitment, pay and promotion, creating huge new compliance and reporting obligations for employers.

Platform workers

The Platform Workers Directive is due for transposition by December 2026. It introduces a presumption of an employment relationship between a platform worker and a digital labour platform where there are indicators of direction and control.

Age

And then 'Age as an Asset' is something we've been talking quite a lot about for some time. We've seen a fall off in employers seeking to put in place justifications for retirement ages, and instead plan for retaining older workers for longer. The contractual retirement ages bill is making its way through the legislative process. It will allow employees to notify their employer that they do not consent to retiring at the contractual retirement age, but instead wish to work until the State Pension Age, which is now 66. The transposition of the Pay Transparency Directive will significantly reshape pay practices in Ireland. Although we don't yet have draft legislation, our view is that employers should begin preparing now by assessing their current pay structures and ensuring they understand the Directive's likely impact.

So employers should start thinking about things like categories of employees, that is employees performing the same work or work of equal value, because ultimately employers are going to have to be able to provide information about individual pay and pay across genders for each category.

Employers should start thinking about the criteria which determines pay and pay progression.

Employers should start thinking about whether they might want to carry out a dry run assessment to identify potential gaps within categories of employees so as to understand in advance where action might be required.

Employers should review recruitment practices. There is no harm in adapting early and including salary information in job advertisements and in ensuring that recruitment and selection processes are compliant.

Employers should also start thinking about preparing for employee information requests and start thinking about where decisions around pay are made. Because if the source of a decision about pay is, for example, in another country, it could end up being the case that comparators might be permitted from that other country, dependent on how the Directive is transposed in Ireland. Employers need to shift their mindset from policy to proof.

Conclusion

For a number of the reforms scheduled for 2026, it's no longer going to be enough to simply have a policy or a contractual clause. Employers are going to have to be able to prove that pay as between genders is fair and prove that platform workers are not employees, so not under the direction and control of the organisation. Likewise, employers already have to prove that contractual retirement ages are objectively and reasonably justified by a legitimate aim.

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The content of this article is provided for information purposes only and does not constitute legal or other advice.