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Team Council
Summary record of the fifth session of the Team Council
Session details. The session was held on 25 June 2026 in two Open Table sittings: the Asia-Pacific sitting from 06:00 to 07:30 UTC and the Europe/Africa/Americas sitting from 16:00 to 17:30 UTC. The Council's attendance records do not state a session headcount or a separate country count. As context, the Team Council had 65 members from 27 countries on that date; those figures describe Council membership, not confirmed attendance.
Agenda. (a) Review of Team Council reports and current evidence; (b) the First Ten Hires cost diary; (c) comparison of employment costs and registration processes; (d) progress on the five-part pattern test for TM-001; and (e) evidence-gathering and next steps.
The Chair opened the two sittings and recalled the Council’s mandate under TM-001: to examine whether lower and simpler employment costs for a business’s first ten hires could support formal hiring. He stated that the Council was not considering a single country’s tax system or asking for a general reduction in worker protections. Its task was to describe recurring small-employer practices and consider a practicable proposal built around phased social contributions, one-stop payroll registration and predictable rules.
The Chair reported the evidence position as at 25 June. The Team Council had 65 members in 27 countries and had received 51 reports from 19 countries. The reported situations were classified as hiring-cost situations. The median amount at stake was approximately US$3,139. Eighteen reports had been filed during the preceding 30 days. The Chair emphasized that the number of reports did not by itself establish that a practice was widespread or consistent; reports would need to be assessed against all five parts of the Council’s pattern test.
The Chair placed the Council figures in the context of the Assembly’s wider reporting system. Reseated had 979 members in 49 countries and had received 2,698 reports from 50 countries as at 25 June. He noted that the difference between countries represented by members and countries from which reports had been filed should be preserved in any public presentation. The Council agreed that its material should distinguish membership, report origin and the location of any described employment practice.
Ms Ana Ribeiro of Curitiba, Brazil, described the uncertainty she had encountered when considering a first formal hire. She said the difficulty was not limited to the headline contribution rate: she had needed to identify which office to approach, what registrations had to be completed and when a cost estimate could be treated as reliable. She considered a single, authoritative start-to-finish checklist more useful than a broad statement that hiring should be made cheaper. The Chair recorded her contribution as evidence of administrative complexity, without treating one account as proof of a general pattern.
Mr Lukas Weber of Leipzig, Germany, discussed the difference between the amount shown in a wage calculation and the amount an employer must be ready to pay across the employment relationship. He observed that a small employer may need to budget for employer contributions, payroll administration and the timing of payments before the first salary is due. The Council noted the OECD’s reported 2025 tax-wedge figures for OECD countries, including an OECD average of 35.1 per cent and a figure of 49.3 per cent for Germany.1 Members cautioned that the tax wedge is a comparative indicator and does not describe the complete cash-flow or compliance burden faced by any particular small employer.
Ms Chisato Mori of Osaka, Japan, described the value of predictable rules when a business moves from operating alone to employing another person. She said that a clear estimate before recruitment would help a small employer compare the cost of hiring with the risk of delaying a hire. She asked that any proposed standard distinguish between a contribution that is temporarily reduced and one that is merely deferred, since the latter may create a later payment obligation. Members agreed that the cost diary should record when an amount becomes payable, not only the amount ultimately paid.
Mr Samuel Okafor of Accra, Ghana, raised the risk that complex registration requirements can discourage formal employment, particularly where a very small employer has no dedicated payroll staff. He supported exploring one-stop registration but stressed that a simplified route should not remove access to information about employment rights or social protection. The Council noted the International Labour Organization’s estimate that about 80 per cent of enterprises operate in the informal economy and its estimate that micro, small and medium-sized enterprises account for about 70 per cent of employment worldwide.2 Members treated those global figures as context, not as evidence that any particular registration rule caused informality.
Ms Lucía Fernández of Córdoba, Argentina, reported that it was difficult to compare employment costs when available cases used different wage assumptions, time periods or definitions of employer cost. She proposed that the comparison exercise state the wage, the employer’s location, the type of employment and the period covered. She also recommended showing the first-year cost separately from the steady-state cost, where the rules provide a phased contribution. The Chair agreed that the comparison should identify its assumptions prominently and should not present unlike cases as directly comparable.
Ms Amina Yusuf of Nairobi, Kenya, described the significance of timing for a small employer with limited cash reserves. She said that a payment schedule can affect the decision to hire even where the total annual cost is understood. She recommended that the evidence form ask when the employer first learned the amount due, when payment fell due, and whether the amount changed after registration or payroll began. The Council agreed that these questions could help distinguish uncertainty, timing pressure and the level of the charge itself.
Mr Daniel Santos of Manila, Philippines, supported retaining a short, practical cost diary rather than asking members to reconstruct a detailed payroll history. He proposed that members record a small number of comparable points: the expected monthly wage, estimated employer cost before hiring, the first actual payment, any later adjustment, and the time spent on registration and payroll administration. He stressed that members should be able to submit a report without identifying their business publicly. The Chair confirmed that member anonymity remained the default unless a member chose a public seat.
Ms Noor Al-Hassan of Amman, Jordan, asked that the Council’s work account for very different business sizes. The Team Council’s reported distribution included businesses with two to nine team members, 10 to 49, and 50 to 249, as well as members who worked alone. She considered it important to keep the first-hire question distinct from the circumstances of an employer that already had a sizeable team. Members agreed that the First Ten Hires campaign should record the number of existing workers and the proposed hire, so evidence could be grouped without exposing a member’s identity.
Mr Matteo Bianchi of Milan, Italy, raised the question of whether any phased contribution should be limited to a defined early hiring period or apply separately to each of a business’s first ten hires. He noted that the two designs could have different effects on planning and administration. The Chair stated that the session was not asked to choose a policy design. The issue would be retained for evidence gathering and considered only after the Council had established whether the underlying problem met the pattern test.
In response to the interventions, the Chair reviewed the status of TM-001. As at 25 June, two of the five pattern-test criteria had been recorded as met. The Council had not completed the assessment of Volume, Frequency, Consistency, Spread and Corroboration as a whole and therefore had not determined that TM-001 passed the pattern test. No draft standard was before the session. The Council agreed that work on evidence forms and comparisons was preparatory and did not constitute adoption of a policy position.
The Council discussed country coverage reflected in its records. Reports had been received from 19 countries, with Canada contributing 12 reports; Germany and Brazil five each; the United States four; and Italy, Argentina, Mexico and France three each. Members cautioned that report totals by country could reflect differences in participation and could not be read as country-level prevalence. The Chair asked that future summaries state both the count and the limitation, and avoid ranking countries as though the figures represented a representative survey.
The Council considered what additional evidence would be most useful. Members favored collecting the employer’s estimated and actual first-year costs, the sequence of registration steps, time spent on payroll administration, and any change between the initial estimate and the amount paid. They also favored documenting whether an employer delayed, abandoned or proceeded with a hire, while recording the member’s own explanation rather than assuming causation. The Council agreed that reports should distinguish direct costs from administrative time and should indicate when a figure is approximate.
The Council noted that existing Team Council work had included the call for evidence, an open letter on the cost of hiring a first employee, and correspondence concerning small-employer tax wedges and formalisation. Those materials could inform the next evidence review. Members likewise agreed not to attribute a position to a government, employer or other organization on the basis of an individual report.
On the evidence campaign, the Council agreed to continue the First Ten Hires cost diary and employment-cost comparison. The diary should be short enough for a small employer to complete and should invite supporting documents only where a member can safely provide them. The comparison should state its assumptions, distinguish recurring payments from one-off charges, and avoid implying that one country’s arrangement can be transferred without regard to its legal and administrative setting. No member was required to disclose a business name.
The Chair summarized the session’s conclusions. The Council would continue describing the problem, not yet proposing a final remedy. Its evidence remained limited to reports and member accounts, and the five-part test was incomplete. The session made no decision to recommend a particular tax rate, exemption, contribution schedule or payroll system. The possible elements of a future fix—phased social contributions, one-stop registration and predictable rules—remained the scope of the agenda item, not adopted requirements.
Decisions and action items
Evidence status. The Council confirmed that TM-001 remained at two of five pattern-test criteria as at 25 June. The Council would not proceed to a draft fix until the evidence review was sufficiently developed.
Cost diary. The Secretariat, with the Chair coordinating, would revise the First Ten Hires cost diary to capture estimated and actual costs, payment timing, registration steps and administrative time, while keeping the form proportionate and protecting member anonymity.
Comparison method. The Council’s evidence volunteers would prepare a common comparison template stating wage, location, employment type, time period and other assumptions, and separating one-off costs, recurring costs and deferred payments.
Country reporting. The Secretariat would ensure that future summaries distinguish membership figures from report counts and report-origin countries, and would include a caution that country totals are not prevalence estimates.
Pattern-test review. The Chair would coordinate a further review of the five criteria, including the limits of the current sample and any corroborating evidence in the Council's records and cost diary. The Council would not characterize the issue as passed until all five criteria had been assessed.
Next session
The next Team Council Open Table session was scheduled for 23 July 2026, with Asia-Pacific and Europe/Africa/Americas sittings. The Secretariat would confirm the sitting times and circulate the revised diary and comparison template in advance.
Sources
OECD, Taxing Wages 2026: Germany country note — https://www.oecd.org/content/dam/oecd/en/publications/reports/2026/04/taxing-wages-2026-country-notes_491a0e97/germany_649f0784/ca03c391-en.pdf
International Labour Organization, Micro, small and medium-sized enterprises — https://www.ilo.org/topics-and-sectors/micro-small-and-medium-enterprises
Notes and sources
Sources
This document has no standing until adopted under the Founders Charter. Reseated Councils is not affiliated with the United Nations.