If there is one truth HR leaders can no longer ignore, it’s this: the AI transformation isn’t coming, it’s already here. Unlike past waves of organisational change, this one won’t be optional. Every company will need concrete, intentional plans for how AI will be integrated in workplace.
HR will remain at the forefront of this shift. At Spotify, we’ve introduced a chatbot to answer employee questions on policies and processes – from vacation entitlements to parental leave and wellness benefits. But as these systems mature, human judgment will only grow in importance.
The real transformation, however, won’t be technical; it will be behavioural. The organisations that invest in building AI fluency across their entire workforce will pull ahead in 2026. This transformation won’t be the result of HR initiatives or R&D pilots; it will be a company-wide evolution requiring cross-functional alignment and shared ownership.
Retention will be one of the most critical competitive differentiators in 2026. As the labour market shifts again, the cost of attrition and burnout will only rise. For this reason, another big focus will be mental health. In a world that is moving faster than we have ever experienced, employees need stability, clarity and psychological safety. The organisations that win in this era will be the ones that invest deeply in their people.
People do their best work when they feel valued, supported and seen. The rapid rise of AI doesn’t diminish that truth. In 2026, human-centred leadership will be essential.
2026 will be the year we stop obsessing over where we work. We will move beyond the office-versus-remote debate, as the collective focus shifts to how work gets done. Organisations that are future-focused will put less emphasis on policies about place and more on the practices that enable distributed work to be done effectively.
The big shift will be in how work gets done with AI as a teammate – stitching context across locations, enhancing collaboration and freeing people to focus on higher‑value, human problem-solving.
AI has the power to fundamentally shift how we work, individually and in teams. Leaders who build a culture of experimentation, giving people safe spaces to play, test and learn with AI as a teammate – and model this behaviour themselves – will see the biggest shift. HR and people leaders will play a crucial role in upskilling, modelling and championing this cultural transformation.
Teams will progress from AI experimentation to strategic use. Those that design AI into their workflows effectively and use the technology to solve real business challenges will see the greatest gains. Teams will set clear goals, plug AI into the right data, create simple playbooks, measure progress, refine and scale out the most effective solutions.
The intersection of AI and mental health in the workplace is going to be a critical concern in 2026. I see a tension forming between operational efficiency and the need for human empathy.
One of the biggest risks is that using AI to automate management tasks, such as performance reviews or feedback, can make employees feel dehumanised, like a number in the system, rather than individuals. That erosion of trust and psychological safety can lead to burnout, anxiety and disengagement.
I’ve also noticed what I call the ‘hiding’ phenomenon: managers who are strong technically but less skilled in people management sometimes hide behind AI platforms. The feedback might be technically correct but lacks authenticity, and it prevents the human-to-human connection that employees really value.
Generational differences play a role too. Younger employees, who are highly emotionally intelligent, are most vocal about their mental and physical health and are wary of AI encroaching on authentic interactions. Middle-aged employees tend to be more comfortable with these tools, while older generations often share the younger cohort’s scepticism.
Looking ahead to 2026, organisations will realise that AI cannot replace human connection. To protect mental health, leaders must focus on psychological safety, not just surface-level perks such as yoga or wellness apps, but real investment in upskilling managers in empathy and emotional intelligence.
Dr Melissa Carr
Director of DEI at Henley Business School
In 2025, diversity, equity and inclusion (DEI) was used as a weapon – symbolising everything wrong with “wokeness”. In America, President Donald Trump’s administration has branded migrants as “aliens” and “invaders”, casting those campaigning for human rights as soft on crime or even complicit with “monsters”. Inevitably, this rhetoric has spilled into corporate life. DEI has sometimes been seen to protect the “undeserving” or lower standards. And DEI leaders are routinely pulled into battles over who belongs and who does not.
Moving into 2026, we’re going to see DEI going undercover. Rather than a separate initiative, it will be built into everyday workforce engagement, even if the language of DEI is used less openly. By relabelling their DEI programmes as “culture”, “belonging”, “responsible business” or “workforce equity”, for instance, many firms are already ensuring their practices are continuing.
In a world where US federal policy is pulling in one direction and other jurisdictions moving in another, we will see multinational organisations adopting a regional recalibration model, holding a clear global commitment to equity and dignity, but tailoring mechanisms to local context.
Source – https://www.raconteur.net/talent-culture/hr-leaders-share-their-2026-workplace-predictions