Summary record of the sixth session of the Team Council

Summary record of the sixth session of the Team Council

Date: 26 July 2026
Kind: Minutes
Status: Published
Chair: Nikola Jurić, Chair of the Team Council, Leipzig, Germany
Sittings: Asia-Pacific sitting, 06:00 UTC; Europe/Africa/Americas sitting, 16:00 UTC
Attendance recorded: 79 Team Council members from 32 countries
Recipient: —

Agenda

1. Opening of the sixth session and confirmation of the agenda.
2. Review of the evidence received on the cost of hiring and retaining a first team.
3. Review of TM-001, the proposed Fair Hiring Cost Standard, against the five-part pattern test.
4. Discussion of the First Ten Hires cost diary and employment-cost comparison.
5. Decisions, assignments and the next session.

Proceedings

1. The Chair opened the session in the Asia-Pacific sitting at 06:00 UTC and reconvened it in the Europe/Africa/Americas sitting at 16:00 UTC. The record treats the two sittings as parts of one session. The attendance count above reflects the Team Council membership recorded on 26 July; the available Council record identifies 79 members in 32 countries. The Chair invited members to describe recurring practices and costs without identifying their own businesses or naming companies in allegations.

2. The Chair recalled the purpose of TM-001: to consider whether simpler, lower and more predictable employment costs for a business’s first ten hires could support formal hiring. The proposal under examination included phased social contributions, one-stop payroll registration and predictable rules. The Chair emphasized that these were elements of the proposed standard, not measures adopted by the Assembly. At the date of the session, the item had met two of the five pattern tests. The Council had not completed its assessment, prepared a draft standard or opened a consultation.

3. In reviewing the evidence base, the Chair noted that the Team Council had 79 members from 32 countries and had received 83 reports from 28 countries. The median amount at stake in the reported situations was approximately US$4,115. The figures described the available reports and did not establish that every member or every jurisdiction faced the same cost structure. Members were asked to distinguish amounts paid, costs of compliance time, and costs that were expected but not incurred.

4. The Chair further noted the recorded distribution of reports by situation and team size. All 83 Team Council reports concerned hiring costs. Among the reporting businesses, 42 per cent had teams of 2–9, 14 per cent had teams of 10–49, 37 per cent were operated by one person, and 6 per cent had teams of 50–249. Thirty reports had been filed in the preceding 30 days. The Chair cautioned that the team-size distribution was descriptive of the reports received, not an estimate of the structure of all small employers.

5. Members reviewed the countries contributing the largest numbers of Team Council reports: Canada, 17; the United States, 9; Germany, 7; Brazil, 5; Italy, 5; Argentina, 3; Mexico, 3; and the United Kingdom, 3. The Chair stated that geographic concentration would be kept visible in any later analysis. A report count by country would not, by itself, show whether the same rule applied across countries or whether a similar experience had the same cause.

6. Ms. Amina Rahman of Kuala Lumpur, Malaysia, described the difficulty of comparing a stated contribution rate with the total amount a small employer must budget before a hire begins. She said the evidence exercise should record the timing of registration, the first payment date and any recurring filing steps as well as the headline rate. She supported a common diary format that allowed members to enter local currency and dates, while preserving the original figures alongside any later conversion.

7. Mr. Haruto Sato of Osaka, Japan, emphasized the distinction between a one-time administrative task and a cost that recurs with each payroll period. He proposed that the cost diary record hours spent on registration, payroll preparation and correcting filings separately, rather than combining those hours into one estimate. The Chair agreed that the distinction was relevant to consistency and corroboration, and asked that the diary not imply that all recorded time could be converted into a single comparable monetary amount.

8. Ms. Thandi Mokoena of Johannesburg, South Africa, raised the risk that an apparent reduction in direct hiring cost might be offset by uncertainty about eligibility, thresholds or changing requirements. She asked members to record when a cost or obligation became known and whether the rule could be understood before a hiring commitment was made. Her intervention was recorded as a question for evidence gathering; the Council did not reach a finding about any particular national system.

9. Mr. Daniel Okafor of Lagos, Nigeria, observed that the formal and informal parts of a small business’s operations may overlap, and that the decision to hire formally could involve costs beyond the initial contribution. The Chair noted the ILO’s estimate that MSMEs account for about 70 per cent of employment worldwide and that about 80 per cent operate in the informal economy.¹ Members agreed that the global figures provided context but did not prove that a particular hiring cost caused informality in any one report.

10. Ms. Giulia Bianchi of Bologna, Italy, asked that the comparison exercise show the components of an employer’s cost rather than rank countries using one combined figure. She referred to the OECD’s 2026 publication, which reported an OECD-average tax wedge of 35.1 per cent for 2025 and a figure of 45.8 per cent for Italy.² She said that such measures could help frame questions but should not be presented as the amount a small employer pays for a first hire, since the standard comparison was not a complete record of every business’s hiring and compliance costs.

11. Mr. Lukas Weber of Leipzig, Germany, supported the same caution. He noted that a cross-country comparison needed to state what was included, the reference year, and whether a figure represented a tax wedge, a contribution, an administrative expense or a member’s reported cash outlay. The Chair recorded that the Council would not use a national headline figure as a substitute for member evidence. Mr. Weber offered to review the proposed comparison template for clear labels and consistent units.

12. Ms. Camila Ferreira of São Paulo, Brazil, asked that the evidence process account for changes in a business’s team size. She said that a rule may be experienced differently by an employer moving from operating alone to making a first hire than by an employer already managing a team. She recommended that the cost diary ask whether the report concerned a contemplated hire, a completed hire or a later payroll period. The Chair considered this a practical way to clarify the setting of each report without requesting identifying business details.

13. Mr. Mateo Álvarez of Buenos Aires, Argentina, recommended a separate field for uncertainty and unanticipated expense. He said that members should be able to state whether a reported amount was a required payment, a professional service cost, an estimate, or a possible future liability. The Chair agreed that the categories should be kept distinct. Mr. Álvarez also asked that the template allow a member to say that a figure was unknown rather than prompting an unsupported estimate.

14. Ms. Sofía García of Mexico City, Mexico, highlighted the importance of recording the sequence of steps a small employer encountered. She suggested that the comparison exercise show where registration, payroll setup and payment occurred in relation to the first day of work. She also asked that the evidence materials explain that Council members were describing practices, not accusing or assessing a single company. The Chair confirmed that this distinction remained part of the Council’s approach.

15. Ms. Eleanor Price of Manchester, United Kingdom, asked the Council to capture the effect of unpredictable rules separately from the amount of a contribution. In her view, a small employer may need to plan cash flow before knowing the final amount or the date on which an obligation falls due. She recommended a field for the notice period or advance information available to the employer. The Chair accepted the proposal for consideration in the next revision of the evidence template, without treating it as a conclusion that unpredictability had already passed a pattern test.

16. Mr. Peter Novak of Toronto, Canada, proposed that each diary entry distinguish firsthand experience from information supplied by an adviser or obtained from a public source. He considered that distinction necessary for corroboration and for later review of conflicting reports. The Chair agreed that evidence provenance should be recorded in a proportionate manner, while ensuring that members were not asked to disclose the identity of a business or an adviser. Mr. Novak volunteered to prepare a short set of cases illustrating the distinction.

17. The Chair summarized the discussion against the five-part pattern test: Volume, Frequency, Consistency, Spread and Corroboration. The test remained the governing framework. Members had discussed the number and distribution of reports, repeated cost categories, differences among jurisdictions, and the need to document sources and circumstances. The session did not alter the recorded status of two tests met out of five. No additional test was declared met, and no final pattern finding was made.

18. In discussing the First Ten Hires cost diary, members supported a format that was brief enough for a small employer to complete and detailed enough to separate cash payments, time, timing and uncertainty. The diary should permit local currency, preserve dates and distinguish an actual payment from an estimate. It should not require a member to name a business, disclose commercially sensitive information, or assume that every employer has access to a payroll adviser. The Chair asked that revisions be tested for clarity before broader use.

19. On the employment-cost comparison, members supported transparent definitions and cautioned against treating unlike measures as equivalent. The exercise should show the components and reference periods used, and identify where comparisons depend on national circumstances. It should be presented as an analytical aid to the pattern review, not as a league table or an adopted policy proposal. Members noted that the Council’s objective remained to identify whether a recurring practice warranted a draft fix, followed by public consultation and an Assembly ballot under the Assembly process.

20. The Chair recalled the Council’s earlier evidence work, including the call for evidence on TM-001, the open letter on the cost of hiring a first employee, and correspondence concerning small-employer tax wedges and formalisation. Those documents provided procedural context; the session did not amend them or make new representations to the OECD or the ILO. The Chair also reminded members that adoption of any standard would require the subsequent Assembly process and, if adopted, letters to the relevant chief executives or other decision-makers able to implement it.

21. On the basis of the discussion, the Council decided to keep TM-001 at the evidence and pattern-review stage. It decided to continue collecting reports using the five-part test; to revise the proposed cost diary so that payment, time, timing, uncertainty and evidence source could be recorded separately; and to improve the comparison template’s definitions and caveats. The Council made no decision to draft or adopt the Fair Hiring Cost Standard, and no member was authorized to present the proposal as an adopted rule.

22. The Chair closed by thanking members for keeping their contributions specific while protecting business identities. The next session was scheduled for August 2026 as part of the monthly Open Table cycle; the date was to be announced. The agenda would include review of the revised evidence tools and any additional reports, without presuming that the pattern-test status would change.

Decisions and action items

Sources cited

1. International Labour Organization, “Micro, small and medium-sized enterprises.”

2. OECD, Taxing Wages 2026, Germany country note and comparative figures.

Notes and sources

Sources

1. International Labour Organization, Micro, small and medium-sized enterprises
2. OECD, Taxing Wages 2026, Germany country note