Polish labour law

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polish labour law

Have you ever had to do with Polish labour law? Probably not but since there are many US and UK based companies opening their branch offices or operating in Poland there is a chance you may soon have to deal with it, either as an employer representative or an employee.

Polish labour code

If that is the case, the first and foremost piece of legislation that you need to look into is the Polish labour code.

The Polish labour code will tell you:

  • how to conclude an employment contract and how to terminate it,
  • how to manage wages,
  • what are employee and employer statutory duties,
  • how you can prevent employee competitive activity via non compete agreements,
  • when the employee is liable for damage or loss caused to you,
  • what you need to know about work time, leaves and parents’ rights,
  • whether you can employ a minor,
  • what safe and healthy measures you need to take in your workplace,
  • how to go about union agreements (barganing agreements),
  • when you may be charged with an offence against an employee.

Collective dismissals and trade unions

For more detailed issues you may need to look into specific pieces of legislation. For example, if you require information on mass layoffs, you will have to get familiar with the Collective Dismissals Act. If you are concerned with trade unions and their rights, the right act for you would the Trade Unions Act. There are many more. Some professions have their own acts to govern their particular emloyment contracts and rights.

Featured General

Minimal wages in Poland

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minimal wages in Poland

Statutory minimal wages

Most European legislations provide for statutory minimal wages as a means of protecting employees. Whether or not minimal wages actually play that protective role is a question to economists. Employment lawyers focus on legal aspects of minimal wages, so let me say a few words about that.

How is minimal wages determined in Poland

Minimal wages in Poland are determined by a special committee comprising members of the government, trade unions and employer organizations. The commitee is referred to as the Council for Social Dialogue. Technically, the Council should, by 15th June of each year, be provided by the government with a set of economic data, including price indices, and forecasts of price/GDP/household income variations. The Council then has 30 days to agree on minimal wages. If it fails to do so, the government may decide on the minimal wages without consulting the Council. Minimal wages for the following year should be determined by 15th September of the current year. In practice the Council rarely reaches an agreement on the minimal wages, so it falls to the government to decide.

Minimal monthly wages and hourly rate

It is important to note that minimal wages to be determined by the Council or the goverment are:
  • minimal monthly wages for full time work (understood as work performed under an employment contract) and
  • minimal hourly rate for individuals performing professional activities under civil law contracts.

In 2020 the minimal monthly wages is 2600 PLN, while the minimal hourly rate is 17 PLN.

In 2021 the minimal wages will be 2800 PLN, while the minimal hourly rate will be 18,30 PLN.

These are gross amounts, so they must be decreased by statutory deductions (income tax, social and health insurance contributions). In the end, the disposable income is not overwhelming.

Claim for minimal wages

The legal effect of minimal wages is that a full time employee’s monthly salary (including base salary and regular additional payments) may not be lower than minimal wages. Part time employees are entitled to minimal wages on a pro rata basis. Otherwise the employee has a claim to increase the salary up to the statutory minimal wages.

Apart from that, minimal wages affect other areas of employment law in Poland. For example, employees filing for damages based on discrimination or victimisation are guaranteed by statute that the damages, if awarded by the court, will not be lower than minimal wages. Certain additional pay components (e.g. for work at night) also depend on statutory minimal wages.

Remuneration

What is the rule of equal treatment?

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equal treatment

The rule of equal treatment

Polish labour law provides for the obligation to treat all employees equally with respect to conclusion and termination of employment, employment terms, promotion and access to professional training, irrespective of:

  • sex;
  • age;
  • disability;
  • race;
  • religion;
  • nationality;
  • political views;
  • trade union membership;
  • ethnic background;
  • religious creed;
  • sexual orientation;
  • full-time or part-time employment;
  • employment for indefinite or fixed time.

Prohibited criteria

These are referred to as prohibited criteria. The list is not exhaustive, meaning that, depending on a situation, there may be other circumstances leading to, or resulting in, discrimination, and thus constituting prohibited criteria.

If the employer differentiates situations of particular employees based on prohibited criteria, they will be considered to violate the rule of equal treatment. The exception is when the employer is able to demonstrate that such differentiation is justified by genuine occupation requirements.

Genuine requirements

Examples of such genuine occupation requirements would include:

  • experience and length of employment affecting the conditions of employment, salary or promotion;
  • grounds related to parenthood protection or disability reasons;
  • changes in working time arrangements if justified by reasons unrelated to employees.

Remedies

Remedies available to discriminated employees are not overwhelming: they may claim damages. The minimum is minimal wages, but there is no upper limit. Employees are protected from dismissal once the claim has been brought. The claim may also be made after the employment relationship has come to an end, no matter whose initiative that was. Damages must be effective, proportionate and preventive.

Equal pay

The employer is also explicitly obliged to provide equal pay for equal work or for work of equal value. In this context pay is understood to include not only regular wages, but also monetary additions and non-material benefits. If a case based on violation of the rule of equal pay is brought to court, the court is not only authorised to award damages to the employee, but also to determine his or her pay for the future. This is an extraordinary legal measure under Polish labout law, as normally the court is not in the position to change or decide about the amount of the employee’s pay. The employee’s pay is subject to the parties’ agreement only.

 
Discrimination

Transfer of undertakings: the concept of transfer

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transfer of assets

Polish labour law does not give a definition of the transfer of undertakings. However, it is traditionally understood as any organizational change which leads to transfer of ownership and includes mergers, takeovers or divisions of undertakings. Legal titles for such transfers are various: sale, lease, inheritance or other.

In the recent years, mostly under the influence of the Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the Member States relating to the safeguarding of employees’ rights in the event of transfers of undertakings, businesses or parts of undertakings or businesses, and the related  rulings of the Court of Justice of the European Union, the understanding of the transfer of undertakings has changed, or rather – broadened to include a number of further sets of circumstances. In short, the transfer of undertakings may be considered to occur:

  • on takeover of tasks, not necessarily assets;
  • on subcontracting certain tasks to a third party contractor (in bilateral relationships);
  • on takeover of services, previously outsourced to one party, by another service provider, especially if such takeover of services was accompanied by takeover of assets related to these services (in tripartite relationships).

Obviously, not all situations described above will automatically trigger the transfer of undertakings. There are certain additional aspects which must be taken into consideration, such as:

  • the kind of day-to-day activity of the parties involved;
  • whether the takeover of tasks/services was accompanied by takeover of assets;
  • whether the tasks/services taken over constitute the major or auxiliary part of the business of the party who launched the takeover.

Because of this it is becoming increasingly difficult to state conclusively whether business transactions are caught by the transfer of undertakings. Needless to say, this leads to a lot of legal uncertainty, both on the part of the employee and the employer. Depending on particular circumstances, the party to whom tasks or services have been subcontracted may not even be aware that the transfer of undertakings has taken place, not mentioning the related employees. From this perspective, even though the broadening concept of the transfer of undertakings was originally and is still meant to protect the employees, it may oftentimes backfire rather than help.

Recently I have had a case court case with just that problem. Another company had taken over subcontracted security services. Before it started to provide the services, it employed a certain number of employees of the previous contractor. Employment was preceded by a regular recruiment process. Not all employees got through it. Not all employees of the previous contractor had been employed by the new company, and certainly not a majority of them. The previous contractor fired some of its employees involved in provision of the security services and removed all its belongings, including kitchen utilities and furniture. The successor provided all necessary equipment, like firearms, vehicles, torches, computers, furniture, etc.

Based on this, the court had to decide whether there had been a partial transfer of undertakings.

The issues to consider were:

  • whether there had been a transfer of tasks and manpower;
  • whether there had been a transfer of assets;
  • which factor: the transfer of tasks/manpower or the transfer of assets was crucial to continue with the provision of security services.

In the end the court resoved that there had been no transfer of undertakings as there was no transfer of assets. Assets, such as firearms, were crucial to provide security services.  This opened the door for my clients to claim severance pay related to mass dismissals.

Transfer of undertakings

Transfer of undertakings: legal requirements

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transfer of undertakings legal requirements

Employers participating in the transfer of undertakings must meet a number of legal requirements to make sure the transfer complies with the labour legislation and measures for employee protection.

Information provided to trade unions or employees

First, employers must inform their trade unions, or – where there are no trade unions present – their employees, of the intended transfer and related matters. These matters include: reasons for transfer, its potential effects on employees, plans concerning employment or work and pay conditions. Information must be given in writing at least 30 days before the intended date of transfer. However, failure to provide information does not make the transfer null and void.

Transfer may not be sole grounds for termination

Second, the employer must not terminate the employees solely on the grounds of transfer. Such termination will be considered injustified and trigger employee remedies (compensation or restoration to work). However, there may be other reasons to justify termination, e.g. the need to restructure or reduce the employer’s workforce, or an employee’s poor performance. The important thing is that any such reason must be genuine and real.

“Summary” termination of the employment contract

Third, employers partaking in the transfer of undertakings must bear in mind that in connection with the transfer an employee is entitled to make use of a “summary” termination procedure. An employee may terminate their employment contract at 7 days’ notice within 2 months of transfer, without giving reasons. An employment contract so terminated will be considered as terminated by the employer with the applicable period of notice. Since the procedure of transfer is aimed at protecting the employee in the first place, there is no equivalent right for the employer and no “summary” termination procedure is available for them. As mentioned above, even regular dismissals solely on the grounds of the transfer are limited.

Transfer of undertakings

Full-time vs. part-time work

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full time or part time

Full-time or part-time work?

Employees may work on a full-time or a part-time basis, whichever is agreed with the employer. There are no particular restrictions in this respect. The choice of the working time scheme is left to the parties to the employment contract.

However, full-time or part-time employment affects mutual rights and obligation of the employee and the employer.

No discrimination

First, it is forbidden to discriminate part-time employees or favour full-time employees with respect to entering into or termination the employment contract, employment terms, promotion or access to professional training. Second, employers are required to inform their employees about opportunities of full-time or part-time employment.

Impact on overtime and vacation leave

Third, part-time employment affects the rules of overtime and paid vacation leave. The amount of vacation leave of a part-time employee should be calculated in proportion to that employee’s working time, with fractions being rounded up to a full day of leave. Further, a part-time employee working longer than stated in their employment contract will not be considered as working overtime provided that the 8-hour-per-day limit has not been exceeded. In this case the employment contract can indicate the number of hours above the contractual working time, exceeding of which earns the part-time employee the right to overtime premium. If it does not, the employee will not be entitled to overtime premium, even though they worked longer than provided in the contract (as long as working time did not exceed 8 hours a day and 40 hours a week).

Working Time and Leave