A new draft law proposing changes to the way the National Labour Inspectorate operates has been submitted to the Sejm. During its first reading on 25 February, the draft was not rejected and was therefore referred to the Social Policy and Family Committee for further consideration. Despite the concerns and controversies raised so far, including by businesses, the legislature continues to pursue the thorough modernisation of Poland’s employment model, which involves increased supervision of the labour market and curbing the abuse of civil law contracts. In this article, we will take a look at the proposals included in the new draft and explain what they mean for businesses.
New powers of the PIP – monitoring civil law contracts
The most controversial proposal is to grant the PIP the power to issue decisions establishing the existence of an employment relationship in situations where the parties have formally entered into a civil law contract (e.g. a contractor agreement, a contract for specific work, or a B2B contract), but the terms of their cooperation actually correspond to those of an employment relationship.
Two-stage monitoring
However, the draft provides a mechanism to limit the automatic conversion of civil law contracts into employment relationships.
This means that a decision declaring the existence of an employment relationship will only be issued if the employer fails to comply with an order to remedy the violations. Therefore, the parties will first be given an opportunity to voluntarily modify their cooperation model.
Appeals to labour courts
A significant proposed change is that appeals would be heard by labour courts instead of the Chief Labour Inspectorate.
Consequently, employers will need to ensure that their appeals are prepared very carefully, as all evidence and arguments will have to be presented at that stage. It will only be possible to supplement these later in exceptional circumstances.
Security during litigation
The court will have the option of granting security by extending labour law protection to the worker. This will significantly reduce the likelihood of the contract being terminated during the litigation process.
Enforceability
The automatic enforceability of decisions has been removed from the draft. A decision will take effect on the date of its issuance, but will only become enforceable following a final, non-revisable judgement, or once the deadline for appeals has passed.
However, the draft still allows for a decision to be declared immediately enforceable on an individual basis, which could pose a greater risk to businesses.
Advance rulings by the PIP
The draft also provides for the introduction of binding advance rulings to be issued by the National Labour Inspectorate. This solution is similar to the situation with tax rulings: an undertaking will be able to request that the PIP assess whether a given legal relationship can be considered a contract of employment. The ruling will thus enable the parties to modify their cooperation model even before a potential inspection.
What are the implications of the draft law for businesses?
Although the future of this draft law is uncertain, the direction of the reform is clear.
The key change – enabling the National Labour Inspectorate to reclassify civil law contracts – remains a milestone of the National Recovery Plan, increasing the likelihood that the reform will be implemented in 2026.
In light of the proposed amendments, businesses should now:
- Analyse the employment model they are using (in particular civil law contracts and B2B contracts)
- Assess how cooperation with their staff is actually carried out
- Limit features that are characteristic of an employment relationship
- Gather documentation confirming the independence of staff members
- Consider auditing civil law contracts
- Develop rules for monitoring advance rulings by the National Labour Inspectorate after the draft law comes into force
It may be a good idea to consult with experts in this regard.
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