Summary record of the seventh session of the Team Council

Symbol: RC/TM/2026/SR.7
Date: 24 August 2026
Kind: Minutes
Status: Published
Chair: Nikola Jurić, Chair of the Team Council, Leipzig, Germany
Attendance recorded: 93 members from 35 countries
Sittings: Asia-Pacific, 06:00 UTC; Europe/Africa/Americas, 16:00 UTC

Agenda

1. Opening and confirmation of the session’s purpose.
2. Review of evidence received on the costs and administrative steps involved in hiring a first employee and building a small team.
3. Discussion of the proposed “First Ten Hires” cost diary and employment-cost comparison.
4. Consideration of the five-part pattern test and the evidence needed before any finding or draft standard.
5. Decisions, action items and the next session.

Summary of proceedings

1. The Chair opened the seventh session in two sittings, at 06:00 UTC for Asia-Pacific and at 16:00 UTC for Europe, Africa and the Americas. He recalled that the Team Council’s agenda item, TM-001, concerns employment costs for a business’s first ten hires. The proposed direction is to make formal hiring more affordable and administratively straightforward through phased social contributions, one-stop payroll registration and predictable rules. The session was a working review of evidence, not an adoption meeting.

2. The Chair noted that the Council’s August evidence record comprised 93 members from 35 countries and 116 reports from 35 countries. The reported median amount at stake was approximately US$4,115. All 116 reports were categorized as concerning hiring costs. Thirty-five reports had been filed in the preceding 30 days. Members were reminded that these totals describe the Council’s submitted evidence and do not, by themselves, establish how common any particular experience is among all small employers.

3. In introducing the agenda, the Chair said that the Council would distinguish between three questions: what a small employer pays; what steps the employer must complete to hire formally; and whether the combined burden is predictable enough to support a hiring decision. Members were asked to separate direct payroll costs from registration, reporting and professional-advice costs wherever their records allowed. No member was asked to identify a business, an employee or a government contact in the public record.

4. Mei-Lin Tan, Singapore, described the value of recording the full sequence between deciding to hire and completing the first payroll. She said evidence should capture the time spent learning obligations, the number of agencies or systems involved and whether instructions changed between registration and the first payment. She supported a common diary template, but cautioned that it should permit a member to report a step as not applicable rather than imply that every jurisdiction uses the same process.

5. Arjun Rao, Bengaluru, India, emphasized that the date on which a cost becomes payable can matter as much as its total amount. In his account, a small employer may have to commit to payroll expenses before receiving revenue from a newly hired worker’s output. He proposed recording the point at which each charge becomes due, whether it recurs, and whether the amount can be known before the employment relationship begins. The Chair noted the proposal for inclusion in the cost-diary design.

6. Thandiwe Mokoena, Johannesburg, South Africa, asked the Council to examine the practical difference between a contribution that is phased for a new employer and a general reduction that applies without regard to hiring stage. She considered a time-limited or headcount-limited approach more closely aligned with TM-001, provided that it did not create a sudden increase in cost when a small employer crossed a threshold. She also asked that the evidence record distinguish a stated legal rate from the amount actually paid by a small employer.

7. Lucía Fernández, Córdoba, Argentina, spoke to the need for predictable rules. She said that an employer comparing the cost of hiring with the cost of remaining without staff needs to know both the recurring amount and the conditions that could change it. She proposed that the comparison work identify when a charge changes because of wages, hours, business size or a change in status. Members agreed that comparisons should show assumptions plainly and should not present unlike employment arrangements as directly equivalent.

8. Amina Yusuf, Nairobi, Kenya, focused on the connection between simpler registration and formalization. She said that reducing a charge alone may not remove the barrier if the employer must still navigate separate processes or cannot determine which step comes first. She supported testing whether a single entry point could make obligations easier to understand, while noting that a one-stop process must still provide clear information about the responsibilities it consolidates. Her contribution was recorded as a question for evidence collection, not as a finding about any named system.

9. Jakub Nowak, Kraków, Poland, cautioned against using one national tax-wedge figure as a substitute for an account of a small employer’s actual first-hire costs. He supported using international comparisons to frame questions, with a clear distinction between an economy-wide measure and the particular contributions, taxes and administrative costs faced by an employer in a given case. The Chair agreed that any comparison prepared for the Council would identify its scope and avoid suggesting that a single rate captures every component of hiring.

10. Camille Laurent, Lyon, France, asked that the evidence collection include employers who considered hiring but postponed or abandoned the decision. She said that records of completed hires alone could miss the point at which a cost or procedure changed the decision. Members agreed that the diary and submission prompts could invite accounts of delayed, cancelled and completed hiring, while keeping those experiences separately categorized rather than treating them as interchangeable.

11. Mateo Rojas, Bogotá, Colombia, proposed that members record the size of the team at the time of the decision and whether the employer already had a payroll provider or professional adviser. He noted that the Council’s existing team-size distribution includes businesses with no employees as well as employers with teams of two to nine, ten to forty-nine and fifty to 249. The Chair said that the comparison should preserve those categories where relevant and should not assume that every first-hire experience begins from the same administrative position.

12. The Council reviewed the available team-size distribution for its reports: 38 per cent were from businesses with no employees, 44 per cent from teams of two to nine, 13 per cent from teams of ten to forty-nine, and 5 per cent from teams of fifty to 249. Members observed that these figures describe the reporting group, not the wider population of businesses. They agreed that the first-ten-hire question should remain central while the evidence also records the employer’s starting point and the size of the team when a reported cost arose.

13. The Chair presented the employment-cost figures already identified for contextual use from OECD Taxing Wages 2026. The OECD-average tax wedge was reported as 35.1 per cent for 2025; country figures provided for discussion included Germany at 49.3 per cent, France at 47.2 per cent, Italy at 45.8 per cent, Spain at 41.4 per cent, Sweden at 41.1 per cent, the Netherlands at 35.9 per cent and New Zealand at 20.8 per cent.¹ Members emphasized that these figures can help locate a policy question but are not a direct estimate of the amount paid by a particular small business for its first hire.

14. Members also considered the international context of formalization. The ILO describes micro, small and medium-sized enterprises as accounting for about 70 per cent of employment worldwide and notes that about 80 per cent operate in the informal economy.² Members agreed that these global estimates support examining barriers to formal employment, but cannot establish the cause of informality in any individual country or business. The Council’s work would therefore use member reports to identify recurring experiences and would avoid converting a global estimate into a claim about a particular national system.

15. On the proposed “First Ten Hires” cost diary, members supported collecting, where available, the employer’s intended hire number; the decision and start dates; expected and actual recurring costs; one-time costs; the time and steps required for registration; the source of cost information; and any change or uncertainty encountered. Members further supported including a field for currency and a brief description of what is included in a reported amount. The diary is to remain voluntary and should permit partial entries where a member lacks a complete record.

16. On the employment-cost comparison, members supported a method that would display assumptions beside results. The comparison should separate employer contributions and taxes from employee deductions, wages and administrative expenses; identify the period covered; and show whether a cost is fixed, wage-linked or conditional. It should not rank countries on the basis of unlike data, or imply that a policy option is transferable without examining its legal and administrative setting. The Council did not approve a comparison model at this session.

17. The Chair reviewed the five-part pattern test: Volume, Frequency, Consistency, Spread and Corroboration. Members agreed that the test requires more than a high report count. The evidence should establish how often an experience is reported, whether the accounts describe a sufficiently consistent practice, how widely it appears across settings, and whether it is supported by more than one form of evidence. The Council made no determination at this session that TM-001 had passed the test or that any of the five elements had been conclusively met. The evidence review remains open.

18. Members discussed how to handle differences in terminology and reporting. It was agreed that later synthesis should preserve a member’s description of a charge or process where its legal classification is uncertain, and should not assign a statutory label without a supporting source. Where two members use different words for what may be a similar experience, the synthesis should record the distinction for review rather than merge the accounts automatically. The Chair said that this approach would help the Council test consistency without overstating comparability.

19. The Council noted the country distribution of the 116 reports: Canada, 18; United States, 17; Germany and Italy, 9 each; United Kingdom, 6; Brazil and France, 5 each; and Mexico, 4. Members agreed that the distribution is relevant to the Spread element of the test but does not settle it. The remaining reports also form part of the evidence base. No conclusions were drawn about the relative conditions in the listed countries, and no country-specific recommendation was authorized.

20. On the question of formal hiring, members supported treating affordability, administrative simplicity and predictability as connected but distinct dimensions. A proposal that lowered a payment while adding uncertain steps would need to be assessed against the full purpose of TM-001. Similarly, a one-stop registration process would not, by itself, answer whether the cost of hiring is manageable for a small employer. Members asked that future evidence summaries make these distinctions visible.

21. The Chair summarized the session’s decisions. The Council would continue the evidence-gathering stage; develop a voluntary diary and a transparent comparison method; retain the distinction between reported experiences and verified legal requirements; and apply all five parts of the pattern test before proposing a draft fix. No standard, draft text or recommendation to a CEO or public authority was adopted. The session did not authorize a letter or represent that any external body had endorsed the Council’s work.

22. In closing, the Chair said that the next stage was to improve the structure of the evidence, not to rush to a preferred policy instrument. Members were invited to submit further reports, including accounts of hiring that was postponed or abandoned, and to identify supporting documents where they could do so without disclosing private business information. He thanked participants in both sittings and confirmed that the next session would continue the review of TM-001.

Decisions and action items

Next session

The eighth session of the Team Council was scheduled for 21 September 2026, with sittings at 06:00 UTC for Asia-Pacific and 16:00 UTC for Europe, Africa and the Americas. The agenda would include review of the diary and comparison drafts, consideration of additional evidence, and an update on the five-part pattern test. No adoption ballot was scheduled.

Sources

1. OECD, Taxing Wages 2026, including the 2025 tax-wedge figures cited in the record.

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

Notes and sources

Sources

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