Year-End and 2026 Payroll Updates

As we approach year-end, you may notice variations in future payroll amounts compared to previous months. This is normal during December and January and is usually related to statutory entitlements and employer obligations mandated by local labor laws.

The most common items affecting December payroll are: 

• Year-End Bonus (e.g., 13th Payment, Christmas Bonus)

• Additional statutory holiday/seasonal payments

• Savings/Provident Fund contributions or transfers, when applicable

• Annual taxes or contributions recalculated at year-end

These components vary by country and may increase the total employer cost for the month, even if employee salaries remain unchanged.

How These Costs Are Displayed

All statutory year-end payments will appear in your invoice, clearly labeled with the corresponding benefit or legal requirement.

You’ll see these items under Employer Costs, with descriptions such as:

• “Employer Costs”
• “13th Payment”
• “Year-End Bonus / Aguinaldo”
• “Statutory Holiday Payment”
• “Savings Fund Contribution”

These are not additional service fees; they are standard legal obligations associated with employee compensation.

Do I Need to Approve Something?

If any non-statutory or discretionary item requires extra confirmation, you will be notified through the platform when payroll is ready for your review and approval. Otherwise, no separate approval is required for these components, since they are mandated by law, and you review payroll as usual.

What to Expect in January 2026: Employer Cost Adjustments

We wanted to bring to your attention that many countries are expected to adjust employer social security contributions as of January 2026. Most adjustments follow historic trends and typically represent increases in employer costs due to updated social insurance thresholds, contribution rates, or statutory ceilings.

To help you plan ahead, here is the average yearly % change in employer social security costs over the past 5 years for our top 25 employer locations:

What does this mean for your team?
While each jurisdiction sets its own annual adjustments, these historical trends serve as an indicator of the direction employer costs may move in early 2026. If you’re planning budgets, forecasting headcount costs, or preparing for expansions, it’s a good time to factor in small contribution increases, and in a few rare cases, slight decreases.

If something in the payroll looks unclear, feel free to contact your CSM directly. We're here to help you make sense of all components.