Summary record of the fourth session of the Team Council

Founders Assembly — Team Council

Symbol: RC/TM/2026/SR.4

Document type: Minutes

Chair and signatory: Nikola Jurić, Chair of the Team Council, Leipzig, Germany

Recipient: —

Summary record

Fourth session of the Team Council, held in two Open Table sittings on 24 May 2026. The Council considered the evidence received under agenda item TM-001, the first-ten-hires question, and the next steps for comparing employment costs across jurisdictions. It agreed to continue evidence collection and to prepare a structured comparison for members; no draft standard was put to a vote.

Meeting details

Agenda

1. Opening of the session and confirmation of the agenda.
2. Review of Team Council evidence received by 24 May 2026.
3. Discussion of employment costs for a business’s first ten hires and the transition from informal to formal employment.
4. Consideration of evidence methods, including cost diaries and cross-country comparisons.
5. Decisions, action items and next session.

Proceedings

1. The Chair opened both sittings and stated that the meeting was an evidence session, not an adoption meeting. He recalled that the Team Council’s agenda item, TM-001, concerned lower and simpler employment costs for a business’s first ten hires. The proposed areas for examination were phased social contributions, one-stop payroll registration and predictable rules. He said the Council should distinguish observed costs from proposed remedies and should not treat a single national case as sufficient evidence of a common pattern.

2. The Chair confirmed that the Council would use the Assembly’s five-part pattern test: Volume, Frequency, Consistency, Spread and Corroboration. He noted that the task at this stage was to establish what the reports showed and what remained uncertain. The Council had not yet completed that test for TM-001. Members were asked to identify gaps in evidence, including differences between statutory charges, administrative obligations and the time or professional assistance required to comply.

3. The Secretariat’s consolidated figures, presented for the session, recorded 49 Team Council members from 24 countries and 32 Team Council reports from 14 countries. The median amount at stake in those reports was approximately US$2,770. The reports concerned hiring costs. The Secretariat emphasized that the figures described the evidence received to date and should not be read as a representative survey of all small employers or of national labour markets.

4. The Secretariat reported that the 32 Team Council reports included 7 from Canada, 5 from Germany, 3 each from Brazil, Italy and Mexico, 2 each from Argentina and the United States, and 1 from the United Kingdom. The figures listed in this summary are the country counts specified in the consolidated record; they do not account for every country represented among the reports. Members agreed that future summaries should preserve the distinction between the number of reports and the number of countries from which reports had been received.

5. On team size, the consolidated record showed that 41 per cent of reporting businesses had 2–9 people, 19 per cent had 10–49, 38 per cent were sole operators, and 3 per cent had 50–249. Members observed that the first hire can be a decisive threshold for a small employer, but that the record also included businesses at later stages of growth. The Council agreed that any subsequent analysis should avoid implying that every report came from an employer currently making a first hire.

6. The Chair noted that 17 Team Council reports had been filed in the preceding 30 days. He described that recent activity as useful for identifying issues that may merit follow-up, but not as proof of frequency across the wider population. Members were invited to submit further reports and to clarify whether the amount at stake referred to direct charges, administration, delayed hiring, or a combination of effects.

7. Mr. Haruto Sato of Osaka, Japan, speaking in the Asia-Pacific sitting, described the practical sequence a small employer may face when moving from deciding to hire to completing payroll registration. He asked the Council to record the time spent understanding obligations separately from the money paid. He considered that a simple account of the steps, dates and points of uncertainty would help distinguish a registration problem from the underlying level of employment contributions.

8. Ms. Nur Aisyah Rahman of Kuala Lumpur, Malaysia, said that a comparison of hiring costs should make the timing of payment visible. In her view, an obligation due before an employer has received revenue from the new hire can create a different pressure from the same obligation assessed later. She encouraged the Council to ask contributors when each charge becomes due, whether it recurs, and whether the employer can determine the amount in advance.

9. Mr. Thabo Mokoena of Johannesburg, South Africa, raised the question of formalization. He considered that employers may postpone registration when the required steps are difficult to understand or when the cost cannot be estimated with confidence. He asked that the Council examine both the cost of compliance and the risk of non-compliance, while avoiding any assumption that a person operating informally did so for a single reason. The Chair recorded the point as a question for evidence, not a finding.

10. Ms. Camila Ferreira of São Paulo, Brazil, focused on the distinction between the headline contribution rate and the total burden of employing someone. She suggested that a useful account would include payroll administration, external assistance where used, reporting frequency and the time needed to correct an error. She also cautioned that small employers may have different arrangements and that comparisons should state what is included rather than present unlike totals as equivalent.

11. Mr. Lukas Weber of Leipzig, Germany, referred to the OECD’s 2026 reporting on tax wedges. The OECD reported an average tax wedge of 35.1 per cent across OECD countries in 2025; its country notes included figures of 49.3 per cent for Germany, 47.2 per cent for France, 45.8 per cent for Italy, 41.4 per cent for Spain, 41.1 per cent for Sweden, 35.9 per cent for the Netherlands and 20.8 per cent for New Zealand.¹ He said these figures could provide context, but were not a direct measure of the amount paid by a small employer for a first hire. The Chair agreed that any use of tax-wedge figures must state their scope and limitations.

12. Ms. Aoife Byrne of Cork, Ireland, asked that the Council not reduce the issue to a comparison of rates. She said that predictability, clarity of guidance and the ability to complete registration through a single process should be examined alongside the total cost. She supported recording a contributor’s expected hiring date, the point at which the employer sought guidance, and whether the rules could be understood without specialist help.

13. Mr. Daniel Rosen of Toronto, Canada, proposed a consistent template for cost diaries. He suggested that contributors record the intended role, approximate hiring date, steps taken, payments due, time spent and any delay or change in plan. He advised that the template should allow a contributor to state “not applicable” or “unknown” rather than encouraging estimates presented as precise figures. The Council agreed that this was a practical method to test, subject to a clear explanation that participation was voluntary.

14. Ms. Valentina Rossi of Milan, Italy, asked whether the evidence could show how obligations change as an employer moves from one employee to several. She considered that a rule may be manageable at one level and burdensome at another, especially where thresholds or reporting duties apply. She recommended that the comparison record the number of employees and the point at which each obligation begins, rather than describing all small employers as a single category.

15. Mr. Diego Hernández of Mexico City, Mexico, noted that contributors may use different terms for taxes, social contributions, insurance and payroll services. He proposed a short glossary for evidence collection so that the Secretariat could identify what each reported amount included. He also asked that a report’s currency and the period covered be captured consistently. The Chair supported the proposal and asked that the glossary remain descriptive rather than impose a legal classification across jurisdictions.

16. Ms. Amara Diop of Dakar, Senegal, referred to the broader context of informal work. The International Labour Organization states that micro, small and medium-sized enterprises account for about 70 per cent of employment worldwide and that around 80 per cent of them operate in the informal economy.² She said these global figures reinforced the importance of understanding barriers to formal hiring but could not establish the cause of informality in any particular country. Members agreed that this distinction should be kept explicit in public-facing material.

17. Mr. Patrick O’Connor of Wellington, New Zealand, asked the Council to examine whether an employer can estimate the cost before making a commitment to hire. He recommended recording whether the information was available from a single official source, whether the stated amount matched the amount later due, and whether a change in circumstances altered the calculation. He considered that these questions would help assess the proposed “predictable rules” element without assuming that a lower contribution rate alone would solve the problem.

18. In the discussion of international context, the Chair also recalled that the United Nations estimates that MSMEs represent approximately 90 per cent of businesses, 60–70 per cent of employment and about 50 per cent of GDP worldwide.³ He stated that the figures explained the importance of the subject but did not substitute for the Council’s own report-based assessment. Members agreed that any use of global statistics should be accompanied by the source and should not be presented as a measurement of the effect of a specific hiring-cost policy.

19. During the second sitting, members reviewed the proposed evidence questions and confirmed that the Council should collect information on direct charges, administrative time, registration steps, predictability and the effect on a hiring decision. They agreed that contributors should be able to describe a hiring decision that was delayed, changed or abandoned, while making clear whether the account was an individual experience or a reported estimate. No member proposed that the figures then available were sufficient to establish a causal relationship between employment costs and informality.

20. The Chair summarized the discussion as identifying a need for comparable evidence across jurisdictions and for a careful distinction between cost, process and outcome. He said the Council could later consider phased contributions, one-stop registration and predictable rules as possible elements of a draft fix, but none had been endorsed as a final proposal. The Council would first examine whether the reported experience met all five parts of the pattern test.

Decisions

1. The Council confirmed that TM-001 remained at the evidence-gathering and pattern-review stage. No determination was made that the five-part pattern test had been passed.

2. The Council agreed to continue collecting evidence on the costs and administrative steps associated with a business’s first ten hires, including the timing and predictability of obligations.

3. The Council agreed in principle to test a voluntary cost-diary template and a descriptive glossary. The session did not adopt a standard or approve a draft for public consultation.

4. The Council agreed that international statistics and tax-wedge comparisons should be presented with their scope and limitations and should not be treated as direct evidence about the experience of a particular small employer.

Action items

Next session

The next Team Council session was scheduled for 24 June 2026, with the two Open Table sittings to be held at 06:00 UTC and 16:00 UTC. The session was to review the proposed evidence template, consider additional reports and assess progress against the five-part pattern test.

Certification

Notes and sources

Sources

1. OECD, Taxing Wages 2026 — Germany country note
2. International Labour Organization, Micro, Small and Medium-sized Enterprises
3. United Nations, Micro-, Small and Medium-sized Enterprises Day