Companies are facing increasingly divergent employment laws around the world amid political upheaval and economic strains, according to a Hogan Lovells study.
The firm’s Employment Horizons 2026 report highlighted that the US has paused Biden-era rules imposing stricter criteria for independent contractors, making it easier for employers in most states to classify workers as contractors rather than employees. This stands in contrast to other countries which have been ramping up protections for gig workers, including the UK, Vietnam, Hong Kong and Mexico.
The UK, for example, has increased minimum wage levels over recent years and the government is using the Employment Rights Act to improve protections for vulnerable workers, such as effectively banning zero-hours contracts for qualifying workers. Mexico, meanwhile, has made it easier for gig workers to access social security benefits if they meet monthly minimum wage requirements.
The report also reveals diverging policies around diversity and pay transparency globally, with the US rolling back diversity, equity and inclusion (DEI) policies at federal level and the Trump administration pushing to enforce against what it calls “illegal DEI’, putting pressure on private businesses to revaluate their DEI programmes.
Meanwhile, other countries are seeking to address employment inequalities. The UK has launched a consultation on its Equality (Race and Disability) Bill, which would impose mandatory ethnicity and disability pay gap reporting for businesses with more than 250 employees. EU members states are also required to start implementing the Pay Transparency Directive this year.
Mike DeLarco, global head of Hogan Lovells’ labour and employment practice, said: “Political instability and economic pressures have driven significant divergence in employment regulation, and understanding these shifts is essential for effective workforce planning.”
The report also highlights diverging rules around AI use and data privacy globally. The US, for instance, is loosening restrictions, though some states including California are tightening AI and privacy laws. This hints at some of the challenges of introducing AI laws. In Italy, legislation introduced to address AI use in the workplace conflicts with the country’s pre-existing Workers’ Statute. Further afield, Vietnam is also implementing stricter standards for data collection related to employment and recruitment.
Ed Bowyer, Hogan Lovells’ Europe head of employment, said: “As organisations operate across more jurisdictions, the need for coherent, cross‑border guidance has never been greater.”
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