Employment 2023

Last Updated August 08, 2023

Poland

Law and Practice

Authors



Hogan Lovells (Warszawa) LLP is one of the top law firms in Poland, offering a broad range of services and tax and legal expertise. The Warsaw office has more than 20 years' experience in advising clients. The employment practice supports clients operating in all sectors of the economy, both in Poland and abroad, and offers legal advice in all aspects of employment law. The advice covers: employment aspects of M&A as well as cross-border mergers, including the transfer of employment establishments to new employers and employee participation rights; restructuring of employment, including group redundancies; issues related to unionised and non-unionised employees; representing employers in negotiations with trade unions, collective disputes and disputes with employees, both inside and outside the courts; cross-border employment and the employment of citizens of EU and non-EU member states in Poland, including work and residency permits; and compliance, mobbing and discrimination-related issues.

In principle, Polish employment law does not stipulate a differentiation between blue-collar and white-collar workers. However, there are certain special provisions in the Labour Code that apply to executives, relating to overtime, maximum weekly working time and minimum rest periods; in particular:

  • employees who manage an employment establishment on behalf of their employer (ie, members of the management board) and heads of separate organisational sub-units of the organisation will, in so far as is necessary, perform work beyond normal working hours without the right to any additional remuneration for overtime;
  • employees who are heads of organisational sub-units have the right to additional remuneration for overtime work performed on Sundays and public holidays if they have not been given another rest day in return;
  • there is no obligation to keep the working time evidence for those employees who manage the employment establishment on behalf of their employer;
  • the limitation on the number of possible working hours per week (ie, a maximum of 48 hours together with overtime hours) does not apply to employees managing the workplace on behalf of their employer; and
  • the requirement to ensure at least 35 hours of uninterrupted rest every week, including at least 11 hours of uninterrupted daily rest, does not apply to employees managing the workplace on behalf of their employer.

Employment contracts should be concluded in writing; however, the lack of a written form will not make the contract invalid. If the agreement is not concluded in writing, the employer is obliged to at least provide the employee with a written confirmation of the employee՚s employment conditions prior to the commencement of their work. The failure to complete the above requirement triggers the employer՚s liability for committing an offence against the employee՚s rights, but does not cause the invalidity of the employment relationship. The written form requirement will also have been met if the document is signed electronically using a qualified electronic signature.

In Poland, employment agreements can be concluded for:

  • a probationary period (no longer than three months);
  • a fixed term; or
  • an indefinite period.

As a general rule, only three consecutive fixed-term contracts are permitted, and the period of employment under fixed-term contracts between the same parties cannot exceed 33 months. It is common practice to employ regular (non-senior-level) employees under an employment agreement for a probationary period (or fixed term) first and to conclude an agreement for an indefinite term afterwards. An employee in a senior-level position typically receives a permanent agreement for an indefinite period from the beginning of their employment.

The employment agreements must be in writing and in Polish unless the employee, if they are not a Polish citizen, requests that the execution of the employment agreement be in a different language.

The parties to the employment agreement are free to choose the law of another country to govern the employment relationship. However, if the work is to be performed in Poland, certain employee entitlements, as imposed under Polish law, would need to be recognised by the employer.

Generally, the working time limit amounts to eight hours a day with an average of 40 hours a week, within an average five-day working week (the basic reference period amounts to four months) subject to extraordinary working time systems that include certain extensions. The limit, including overtime work, amounts to an average of 48 hours a week within the adopted reference period.

There are also provisions that guarantee the minimum daily and weekly rest periods (a minimum of 11 hours per day and 35 hours once a week) and the prohibition of work on Sundays/public holidays (subject to certain exceptions). These limits can be modified based on the system and work time schedule adopted.

Overtime work is, in principle, permitted for the employer՚s justified needs or a rescue action. Overtime should not exceed 150 hours annually, but the employer can modify this to up to 416 hours.

For overtime work, employees are entitled to their regular remuneration plus 50% or 100% additional compensation. Instead of overtime compensation, the employer can grant the employee time off. For employees who regularly work outside the office and whose working time cannot be subject to an employer’s control, it is possible to stipulate a lump-sum overtime compensation corresponding to the estimated amount of overtime work.

The parties are free to agree the amount of remuneration. However, the remuneration cannot be lower than the official minimum wage. The minimum wage for employees is established and adjusted every year by the government. In 2023, the gross minimum remuneration for fulltime employees during the period between January and June was equal to PLN3,490 (approximately EUR780), whereas from July to December it will be PLN3,600 (approximately EUR800). In the case of civil law contracts, such as service contracts, the minimum remuneration in the first half of the year was PLN22.80 (approximately EUR5), however in the second half it will be PLN23.50 (approximately EUR5.30) gross per hour.

The payment of a variable salary is not regulated in the statutes, but is a matter of negotiation between the parties to the employment agreement.

Holiday Leave

An employee is entitled to:

  • 20 days of holiday leave per year – if they have been employed for less than ten years, in general; or
  • 26 days of holiday leave per year – if they have been employed for more than ten years, in general.

Periods of previous employment, even with a different entity, are included in the work record on which the length of the holiday leave depends. Education periods are also included in the work record on which the length of the holiday leave is calculated. During a holiday leave, the employee is entitled to regular pay as if they were working. An employee cannot give up their right to holiday leave. Cash payment in lieu of unused holiday is possible but only in the case of a termination or the expiry of employment.

Sick Leave

Generally, employees on sick leave are entitled to sick pay in the amount specified by law, which is equal to 80% (or 100% in the case of pregnant employees, or sickness caused by an occupational accident) of their remuneration calculated in general on the basis of the salary received for the 12 consecutive months preceding the period of their incapacity to work.

In general, for the first 33 days of sick leave, the above-mentioned sick pay is paid by the employer, after which the payment obligation is taken over by the state (ie, the Social Security Office). In the case of absence from work due to sickness, the employee is obliged to notify their supervisor of their absence from work as soon as possible and no later than on the second day of absence, despite the fact that the sickness certificate is immediately uploaded to an online platform to which the employer has access.

Family-Friendly Rights

Parent employees are entitled to statutory leaves, including:

  • basic maternity leave – from 20 to 37 weeks (depending on the number of children born) (allowance equal to 100% of earnings);
  • parental leave – from 41 to 43 weeks (depending on the number of children born) (the first six to eight weeks’ allowance of 100% of earnings, and then 70%), each parent has an exclusive right to nine weeks of non-transferable parental leave; if a parent decides to apply for parental leave at the same time as maternity leave, then the maternity and parental leaves are both paid at 81.5% (instead of 100% and 70%);
  • paternity leave – two weeks (allowance equal to 100% of earnings); and
  • additional parental leave – maximum of 36 months (unpaid).

The payments during the above-mentioned leaves are paid by the state (ie, the Social Security Office) and are calculated in the same manner as sick pay, meaning they are based, in general, on the salary received for the 12 consecutive months preceding the period of incapacity to work.

Confidentiality

The employee's basic duties, as stipulated in the Labour Code, include:

  • taking care of the interests of the employer;
  • protecting the employer's property;
  • maintaining the confidentiality of information the disclosure of which could expose the employer to damage; and
  • observing the confidentiality obligations stipulated in the Act on Combating Unfair Competition.

However, there are no direct statutory regulations concerning the employee’s confidentiality duties in the post-employment period. Therefore, it is highly advisable to sign confidentiality agreements that would oblige the employee to keep their employer’s confidential information secret both during and after the termination of employment.

Liability Rules

The rules for employee liability for damage caused to their employer depend on whether the employee caused the damage intentionally or accidentally. If the damage sustained by the employer is caused by the employee accidentally as a result of the non-performance or undue performance of work duties, the employee’s liability is limited to the extent of the actual loss incurred by the employer. Moreover, the amount of damages cannot be more than three months’ salary. If the employee causes damage intentionally, they will be liable for the full amount of the damage.

If an employee causes damage to a third party in the performance of their employment duties, only the employer (not employee) is obliged to compensate for the damage.

PPK

A PPK is a mandatory additional long-term saving programme (co-funded by the employer, the employees, and partially by the state). The employer's compulsory minimum contribution rate is 1.5% of the employee’s remuneration. The enrolment into the pension plan is automatic for all employees of applicable age; however, employees have the right to opt out at any time. Failure to set up a PPK can result in fines imposed on the management board of the company amounting to up to 1.5% of the employer’s remuneration fund from the previous year.

Post-employment restrictive covenants can only apply to an employee who has access to particularly important information, the disclosure of which could expose the employer to damage. These clauses must be agreed in writing to be valid and must determine the time, place and scope of the non-compete undertaking. There is no statutory limit concerning the duration of a non-compete restriction, but typical post-termination bans last for three to 12 months. A non-compete will not be effective if it takes the form of an absolute ban on any activity in a particular industry; it must relate to an activity actually carried out by the entrepreneur (main or secondary) or planned (not a hypothetical possibility). Moreover, post-employment non-competition clauses must stipulate the amount of compensation payable to the employee for their compliance with the non-competition restriction. This compensation cannot be lower than 25% of the remuneration received by the employee prior to their termination of employment for the period equal to the period of the prohibition of competition. Compensation can be paid in monthly instalments.

If the employee violates a valid and enforceable non-compete clause, they become liable to pay damages to the employer. In practice, post-employment non-compete covenants are commonly combined with a contractual penalty that must be reasonable in relation to the employee’s compensation for the non-compete restriction. Furthermore, the employer can also be entitled to further damages if the damage caused by the employee exceeds the amount of the contractual penalty.

Important amendments to the Polish Labour Code were introduced in April 2023, according to which if there is no non-competition clause in an employment contract, an employer cannot prohibit their employee from working for another employer or entity.

Non-solicitation clauses with reference to clients and customers are allowed under Polish law. These non-solicitation clauses typically cover the term of employment and/or a defined period after their termination (usually one to three years). Unlike post-employment non-competition covenants, Polish law does not require the employer to pay the employee any compensation for non-solicitation in order to be considered enforceable. Non-solicitation clauses concerning customers in certain circumstances can be considered to be non-competition clauses that require compensation.

In general, the processing of personal data in the employment sphere is subject to the provisions of the Labour Code, which was amended after the entry into force of the General Data Protection Regulation (GDPR). Employers should also keep in mind other regulations contained in various legal acts, which stipulate, for example, the storage limitation periods of certain documents containing employees’ personal data.

GDPR

The GDPR sets forth the general rules that should be followed by employers that act as data controllers of their employees’ personal data. According to these rules, employers should, among other things:

  • have a legal basis for data processing, and ensure that this processing is conducted in a fair and transparent manner in relation to the employees;
  • collect, use and process their employees’ personal data for specified, explicit and legitimate purposes, and should not further process such data in a manner that is incompatible with these purposes;
  • collect, use and process adequate and relevant personal data, which should be limited to what is necessary in relation to the purposes for which it is processed;
  • keep accurate and up-to-date personal data of their employees;
  • keep personal data of their employees for no longer than is necessary for the purposes for which the personal data is processed; and
  • process personal data in a manner that ensures the appropriate security of the personal data, including protection against any unauthorised or unlawful processing, and against any accidental loss, destruction or damage by using the appropriate technical or organisational measures.

The Labour Code

The Labour Code sets forth certain restrictions with respect to the processing of employees’ personal data. In particular, employers are allowed to:

  • request from their employees only certain limited personal data that is expressly listed in the Labour Code, and other personal data but only if it is necessary in order to exercise rights or to fulfil an obligation arising from the provisions of law;
  • process employees’ personal data that does not constitute so-called special category data (eg, health data, political opinions, religious or philosophical beliefs, or data revealing racial or ethnic origin) on the basis of the employees’ consent, but only when the lack of this consent or the withdrawal thereof does not cause disadvantageous treatment or negative consequences for the employees; in particular, it cannot constitute a reason justifying the refusal of employment, the termination of an employment contract with notice, or its termination without notice by an employer;
  • process employees’ personal data that falls within special category data, on the basis of consent, but only if this personal data has been provided upon an employee’s initiative;
  • process an employee’s biometric data, as well as in a situation where it is necessary to provide this data for the control of access to particularly important information, the disclosure of which could expose the employer to damage, or for access to premises requiring special protection; and
  • use monitoring that involves the processing of employees’ personal data only for certain purposes indicated in the Labour Code and only to a certain extent.

In general, there are no special requirements needed to perform work in Poland applicable to an EU/EEA/Swiss citizen.

In order for all other foreigners to be allowed to legally work in Poland, the below-mentioned conditions need to be fulfilled:

  • they must hold a document permitting them to enter the Polish labour market; and
  • they must hold a residence document that also indicates their right to work (eg, the relevant visa or residence permit; a tourist visa would be considered insufficient).

There are several types of documents that allow for entry into the Polish labour market:

  • a work permit (types A, B, C, D, or E) – applied for by the employer to the competent voivode; these types of work permits generally authorise work for up to three years;
  • a seasonal work permit (type S) – applied for by the employer to the competent starost (the Poviat Labour Office); this type of work permit authorises seasonal work (in agriculture, horticulture, the tourist industry), for up to nine months within a calendar year;
  • a declaration on entrusting work to a foreigner – submitted by the employer to the Poviat Labour Office for nationals from Armenia, Belarus, Georgia, Moldova, and Ukraine; this type of work permit authorises non-seasonal work without a permit for 24 months; and
  • a temporary residence and work permit – applied for to the voivode by a foreigner who is staying in Poland legally; this type of work permit authorises the applicant to work and reside in Poland.

Temporary Protection for Ukrainian Citizens

Poland has taken a number of temporary measures to help Ukrainian citizens who have left their homeland as a result of Russian aggression. Ukrainian citizens, who have legally arrived in the territory of Poland since 24 February 2022 and have declared their intention to stay in Poland, have been granted an extended right to stay, work, and set up their own businesses within the territory of Poland. They will continue to enjoy legal residence and the right to work in Poland on the basis of their notification to the Labour Office up to 4 March 2024. In addition, this period has been extended for those pursuing compulsory or voluntary education within the territory of Poland or through means of remote learning provided from Ukraine until 31 August 2024, and for those retaking the Polish matriculation exam until 30 September 2024. An employer who entrusts work to a Ukrainian citizen is obliged to notify the Poviat Labour Office within 14 days from the date of their commencement of work. The notification must include information concerning the minimum working conditions for refugees and data on the employer’s workforce (ie, the number of employees employed under employment and/or civil law contracts) as of 23 February 2022 and the date of notification.

Please refer to 4.1 Limitations on Foreign Workers.

The new remote work law was introduced into the Polish Labour Code in April 2023. Under the new law, employers are entitled to introduce fully remote or hybrid work in their organisation. They can do this either by adopting the internal by-laws to be consulted with employees’ representatives, or by concluding individual employment contracts. Previously, introducing remote work resulting from a unilateral order from a firm was only limited to exceptional cases such as force majeure events.

Under the new remote law, the employer has to provide the remote employee with the materials and tools necessary in order to perform their work remotely, including the installation, servicing and maintenance of any technical equipment. Unlike during the COVID-19 pandemic, the employing entity also has to cover the costs of the energy and telecommunication services necessary in order to perform the work from home, as well as pay an equivalent sum for using private equipment for business purposes. All the payments to be made to the employee can be covered in the form of a lump sum paid either monthly or at other times.

Employers are also required to set the rules concerning data protection and the confidentiality of information, and the health and safety of remote workers, as well as to provide training sessions to employees when necessary.

Polish law does not provide for sabbatical leave. In order to take a long break from work, employees can apply for unpaid leave during which they are protected against dismissal as in the case of any justified absence. It is up to each employer to introduce internal rules on sabbatical leave, especially for long-serving employees.

There is a gradual decline in interest on the Polish market in using temporary workers in favour of an increase in the popularity of outsourcing. A likely reason for this situation is that the leasing of temporary workers through registered work agencies is rather formalised. As a result, employers look for more flexible forms of supplying work forces. However, it is important to keep in mind that outsourcing cannot take the form of “body leasing” meaning the leasing of employees, but should instead have the form of providing certain services which will be performed by workers employed by a service provider.

In addition, as a natural consequence of COVID-19, there is a tendency among businesses to reduce office space and the implementation of desk-sharing solutions either within the employer’s internal premises or within an office space offered by third-party providers.

Another significant development in Polish law, which occurred in February 2023, was the introduction of a new law concerning employee sobriety checks. Employers are entitled to carry out preventive checks for the presence of alcohol or substances similar to alcohol. In order to be able to use said checks, it is necessary to create internal rules on sobriety checks which can be added to the work regulations.

The right to establish and join a trade union is granted to employees, as well as civil law contractors. Establishing a trade union requires, among other things:

  • the adoption of resolutions concerning the establishing of the trade union by at least ten people;
  • the election of trade union authorities;
  • the drawing up of the articles of association; and
  • the union’s registration in the court register.

The trade union is obliged to notify the employer of the number of its members in the given entity twice a year (by 10 January and 10 July). There is no obligation to disclose the names of its members.

Trade unions, if present in a company, retain significant influence over the operations of the company; in particular, the employers are obliged:

  • to agree with the trade union on the remuneration and social benefit fund by-laws (whenever they need to be adopted);
  • to consult with the trade unions about any anticipated termination of the employment agreements with employees who are members of said trade union or are covered by the protection of the trade union as a non-member;
  • to consult/notify the trade unions in the case of an anticipated transfer of the work establishment; and
  • to consult/notify the trade unions in the case of any group lay-offs – with no right to block the dismissals.

Moreover, the trade unions can, under certain conditions, take strike action.

The creation of works councils is not obligatory in Poland; however, employers employing at least 50 employees are required to notify their employees that they are entitled to set up a works council. Works councils have consultation and information rights in matters concerning, among other things, changes in the employer’s economic situation or substantial changes in the work organisation and/or headcount.

Collective bargaining agreements (CBAs) can be concluded between the employer and the trade union (a single-establishment CBA), or between the employers՚ organisations and the intercompany trade unions (multi-establishment CBAs). The purpose of concluding a CBA is to agree on the comprehensive work conditions and terms of the employment relationship (eg, remuneration, additional benefits for employees, employment guarantees) and the mutual obligations of the parties. The terms of a CBA cannot be less favourable than the provisions of the Labour Code. A collective labour agreement directly affects the rights of employees covered by its provisions.

A CBA can be concluded for a definite or indefinite period. A CBA requires registration with the relevant register maintained by the competent state authority (the local labour inspector or the Ministry of Labour). The registration of a CBA is preceded by an examination of the legality of its provisions.

An employment contract can be terminated:

  • by mutual consent of the employee and employer (ie, via a mutual termination agreement);
  • upon written notice by one of the parties observing the period of notice (a so-called termination with notice);
  • upon written notice by one of the parties without observing the period of notice (a so-called termination without notice); or
  • after the expiry of the period for which it has been concluded.

An employer’s statement on the termination of a fixed-term employment contract and a contract for an indefinite period of time upon notice, as well as a statement on the termination of an employment contract without notice, should be in writing (ie, it requires a handwritten signature or a qualified electronic signature in the meaning of EU and Polish law) and should stipulate the reasons for the termination. Furthermore, the employer’s statement concerning the termination should include information on the employee’s right to appeal to a labour court.

The reason for the termination must be valid, justifiable and real, but there is no legal definition or catalogue of the reasons justifying the termination of a contract. This means that dismissals can be justified for employee-related reasons (such as poor performance) or for employer-related reasons (eg, liquidation, internal reorganisation). The reason for the termination must be sufficiently clear for the employee to easily comprehend. The lack of any justified reason for termination is one of the grounds for an appeal against dismissal.

If an employee is protected by a trade union, the employer must inform the trade union of its intention to terminate the fixed-term employment contract or the employment contract for an indefinite period.

In general, Polish law does not distinguish between the procedure for performance-related dismissals or dismissals for economic and/or technical reasons. However, the procedures differ in the case of collective dismissal.

Collective Dismissals

Collective dismissals take place if the employer employs at least 20 employees and within a period of 30 days plans to dismiss at least:

  • ten employees, if the employer employs fewer than 100 employees;
  • 10% of the employees, if the employer employs at least 100 employees, but fewer than 300 employees; or
  • 30 employees, if the employer employs at least 300 or more employees.

Collective redundancies are made upon the employer’s initiative and are motivated by reasons not related to the employees (eg, a reduction in the workforce due to the employer’s financial situation).

The procedure for collective dismissals requires prior consultation with the trade unions (if there are any) or the employee representatives. No letters of dismissal can be handed out until after the consultation period has concluded. Moreover, the employer is required to notify the local labour office as to the outcome of any consultations with the employee representatives, as well as any planned redundancies.

Employees who are made redundant under a collective dismissal procedure are entitled to a severance payment, the amount of which varies between one and three months’ remuneration, depending on the employee’s total length of service with the employer. Severance pay is capped at the level of 15 times the statutory minimum salary in Poland. Severance pay is also due to employees who have been dismissed for non-employee-related reasons, even if the number of dismissed employees does not fall below the thresholds stipulated for collective dismissal, provided the employer employs at least 20 employees.

The period of notice depends on the type of employment contract and the length of service with the given employer. Notice periods can only be extended for the benefit of the employee.

The statutory notice periods are as follows.

For indefinite-term and fixed-term employment contracts, if the employee has been employed:

  • for less than six months – the notice period is two weeks;
  • for six months, but less than three years – the notice period is one month; or
  • for at least three years – three months.

For probation contracts:

  • if the contract is for a period up to two weeks – the notice period is three working days;
  • if the contract is for a period between two weeks and three months – the notice period is one week; or
  • if the contract is for a period of three months – the notice period is two weeks.

During the notice period, the employer can place the employee on gardening leave, and the employee will retain their right to remuneration during this time.

It is generally not possible to pay an employee compensation in lieu of notice. Only in cases of dismissal for non-employee-related reasons can the three-month notice period be shortened to one month in exchange for compensation.

During the notice period, the employee can be requested to use their entire holiday leave or be paid an equivalent for any unused holiday.

An immediate termination due to an employee’s fault (summary dismissal) can take place only if the employee:

  • has seriously and intentionally – or by an act of gross negligence – violated their basic duties (a fundamental breach of the employee’s basic duties);
  • has committed an offence that makes the employee’s further employment in their position impossible, and providing this is obvious or confirmed by a final court verdict; or
  • is responsible for losing a licence or a qualification necessary to perform their duties in the position held.

Such termination is possible only within one month after learning about the circumstances justifying the immediate termination.

Under Polish law, an immediate termination by the employer is also possible in the case of a long-lasting incapacity to work due to illness (lasting longer than the joint period of receiving sick pay from the employer, statutory sickness benefit and rehabilitation benefit for the first three months).

Termination agreements are possible and are often the recommended way of terminating an employment relationship. In a termination agreement, the parties are free to determine the date of expiry of employment (ie, the notice periods do not apply), as well as agree on any other issues. The only restriction is that any waiver of the employee’s right to remuneration stipulated in such an agreement would not be valid. Termination agreements theoretically do not require a written form; however, from a practical point of view, it is recommended that they are executed in writing.

Under Polish law, certain employees enjoy special protection against dismissal, which means that their contracts of employment cannot be terminated upon notice. If notice is served, it will be effective; however, the employee would be able to challenge it in court.

The protection against dismissal specifically applies to:

  • employees absent from work due to holiday leave, sick leave, or maternity or parental leave;
  • pregnant employees;
  • employees at pre-retirement age (ie, four years before reaching retirement age); and
  • trade union officers or members of works councils.

The termination of a contract with trade union officers or members of works councils requires the permission of the management board of the relevant trade union organisation or works council. They are protected from dismissal not only during the term of their office, but also up to one year after this term ends.

An employee can challenge their dismissal in a labour court if there was no justified reason for the dismissal or if the dismissal is otherwise faulty and breaches the law. An appeal can generally be submitted within 21 days of the date of receipt of the termination letter.

Employees dismissed with or without notice, who have been employed for a fixed-term or for an indefinite period, can (i) demand that the court reinstate them to work, or (ii) claim damages.

The value of damages for wrongful dismissal is limited by law; for instance, in the case of indefinite-term contracts, it can be generally awarded up to the amount of three months’ remuneration, but, in the case of extended notice periods, the court can order damages corresponding to the extended notice period.

In the event of reinstatement to work, an employee would also be entitled to compensation for the loss of their remuneration during the term of being unemployed for up to three months. This limitation on the amount of compensation does not apply to certain categories of protected employees (eg, pregnant women, employees at pre-retirement age, or women on maternity leave) who are eligible for the aforementioned compensation for the entire period of their unemployment.

The courts are free to decide whether an employee will be reinstated to work or awarded damages, depending on their assessment of the circumstances of a given case, unless the employee is in a protected category. In long-lasting proceedings, the courts often decide that reinstatement to work is no longer possible.

Grounds for Anti-discrimination Claims

Under Polish law, employees have equal rights for performing the same duties and should be treated equally in terms of:

  • the establishment of employment relationships;
  • the determination of the conditions of employment;
  • promotion and access to training courses aimed at improving professional qualifications; and
  • the termination of employment relationships.

The list of grounds on which employers cannot differentiate between workers is open-ended and includes gender, age, disability, race, religion, nationality, political beliefs, trade union membership, ethnic origin, sexual orientation, employment for a definite or indefinite period, or employment on a full-time or part-time basis.

Burden of Proof

The employee should indicate in the court on what grounds they have been discriminated against and indicate the circumstances demonstrating that they have been treated unequally on those grounds. It is sufficient that the employee substantiates their allegations that direct or indirect discrimination has occurred; whereas the burden of proving that the discrimination did not take place will rest with the employer, who will be obliged to prove that the differentiation between the employees has been motivated by objective reasons.

Claims

An employee who has faced any form of discrimination, harassment or sexual harassment is entitled to claim compensation from the employer, which cannot be less than the minimum remuneration in Poland.

An employee can claim compensation for any damage suffered as a result of a breach of the principle of equal treatment, including the right to claim compensation for the difference in remuneration if it was too low as a result of the employer՚s discriminatory practices.

In addition, an employee has the possibility to terminate the employment contract with immediate effect due to a serious breach by the employer of its fundamental duties towards the employee. In this case, the employee will be entitled to compensation equal to the amount of remuneration corresponding to the notice period.

Court proceedings conducted via video were introduced during the COVID-19 pandemic. Despite the fact that the state of emergency on the territory of Poland was lifted as of July 2023, this possibility will be maintained for a further year, until July 2024. At the same time, an amendment to the Code of Civil Procedure is under way in parliament, which provides for the permanent introduction of the possibility to conduct hearings in civil cases, including employment disputes, by means of remote communication.

Labour disputes are typically resolved by the labour courts, which function within the Polish system of common courts. However, it is also possible to settle a dispute amicably with the help of a mediator (for such a settlement to be binding, it will need to be approved by the court).

The professional legal representation of a party in court is not mandatory in labour law-related litigation. The parties are free to choose whether they represent themselves or ask for representation before the court from a licensed lawyer.

In labour matters, the parties can only enter into an arbitration agreement after the dispute arises. Unlike other types of relations, in labour matters it is not possible to agree in the employment contract that disputes arising between the employer and employee will be settled by an arbitration court, and such a provision would be invalid.

Due to recent changes in the law, the employees have been released from court fees for claims brought against employers. The general rule is that procedural costs (court fees and costs for professional representation) are allocated in proportion to the outcome of the case. However, the costs for professional representation awarded by the court to the prevailing party typically do not correspond to the actual costs incurred but are determined based on statutory tariffs for employment matters. Any difference must be borne by the client.

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Trends and Developments


Authors



Linklaters is a leading global law firm that helps its clients achieve their strategies wherever they do business. The Warsaw office is one of the largest law firms in Poland, offering a broad range of legal services across all major practice areas. The Warsaw team is part of Linklaters’ global employment practice, which allows it to provide seamless legal support to clients on multinational matters, in particular those requiring an innovative or unified approach across various jurisdictions, and to offer clients the benefit of experience gained across the international network. The team works on the most complex and sensitive employee relations issues, including executive exits, whistle-blowing allegations, restructuring and labour disputes, and risk management. It also advises on various day-to-day HR matters. The team has vast experience advising various clients from a range of industries on many significant and complex matters in the Polish and European market.

The Revolution in the Polish Labour Market Continues

The year 2023 has brought changes to a wide variety of HR aspects. Many important amendments to the Polish labour law have been introduced, and HR departments are still struggling to implement them – including remote work, sobriety testing and remodelling amendments of the Labour Code implementing the Work-Life Balance Directive and the Transparent Working Conditions Directive, and introducing other significant revisions – as well as establish new procedures and ensure compliance. Despite the significant number of changes to date, the revolution continues.

New challenges are being added by further law amendments under local and EU initiatives and labour evolution.

Towards More Flexible Working Conditions: Remote Work and a Four-Day Working Week

Remote work still on the rise

The rapidly-changing employment environment requires employers to adapt their practices to its specificity and, in particular, to take into account employees’ preferences in the organisation of work, as well as demographic changes, digital and technical progress, migration, work-life balance settings and the various challenges and threats of today’s world.

From that perspective, more flexible working conditions have become a new expectation of employees and are very often a decisive factor in the selection of employment offers or in staff retention.

However, the freshly introduced remote work laws still raise a plethora of practical concerns for employers and many are still in the process of finding a happy medium for it to become a new reality. Also, cross-border remote work (telework) has become more visible and is slowly being addressed in the legal landscape, filling the grey area in which it has operated to date. Poland has signed the Framework Agreement on the application of Article 16(1) of Regulation (EC) No 883/2004 in cases of habitual cross-border telework. As of 1 July 2023, based on the above Agreement, the social security system of the state of the employer’s seat may be applicable to the teleworker, provided that the cross-border telework in the state of residence takes up less than 50% of the working time. From a practical viewpoint, the scope of applicability of the arrangement still remains open to interpretation, for example, whether it will be applicable to cross-border remote workers and whether the Agreement will be applicable to the given country where the telework is performed. Without a doubt, it is a step forward on an EU level, but many doubts and risks in cross-border remote work remain, including in the applicable law and management of crisis events. Otherwise, the employment relationship that is tied up with procedural knots by national legislations without any common EU-wide co-ordination rules could lose its popularity, to the benefit of all types of freelancer contracts which allow far greater remote work freedom, especially in certain sectors.

Four-day working week: wishful thinking or a real future?

There are rumours that economic uncertainty and crises may be the underlying cause for the growing number of companies that are implementing a four-day working week or other models with decreased working time, which also accidentally coincides with employees’ expectations in general. What seemed almost impossible several years ago, in the current circumstances, might materialise sooner than expected. Currently, certain companies are implementing the scheme for a fixed duration to gauge the workers’ response. Also, some companies have implemented a four-day working week to prevent temporary economic difficulties and avoid redundancies. There are also entities which treat the shortened working week as an employee benefit, attracting talent and giving a reasonable advantage. Either way, reducing traditional monetary benefits and replacing them, partly, with a reduction in working hours might meet the expectations of the young entering the labour market – expectations which are vastly different from those of previous generations. Some believe that the companies which are first to introduce this non-monetary advantage will be the winners in the increasingly competitive employment market. As proof of the importance of the topic, a legislative proposal to shorten the working week from 40 to 35 hours was submitted to the Sejm, the lower house of Poland’s bicameral parliament, in September 2022 by a group of MPs from the Left. Despite the fact that the draft has not yet received an official response from the government, the proposal proves that an increasing number of companies are discussing this solution for various reasons. However, a four-day week may potentially be introduced soon, tailoring working time organisation at the employer, based on the currently binding provisions of the Labour Code, and allowing for certain adjustments of the working time, including, for example, shortening of the weekly working time based on the internal work regulations and decreasing remuneration proportionally in the individual employment contracts, or extending daily working time and retaining regular individual remuneration. Various scenarios are possible, depending on the given case.

Whistle-Blowing Obligations Belated but Still Coming

Although the deadline for the implementation of the EU Whistle-Blowing Directive by EU member states lapsed on 17 December 2021, the respective provisions have still not been implemented in Poland. Several versions of the applicable draft act have been published over the course of the last two years but none of them is final, and it is expected that the final draft will be further amended in relation to the most recent one. It seems that the most significant challenge resulting from the projected provisions (as stipulated in the draft dated 12 July 2023, which is the latest one at the time of writing) is that the obligation to adopt internal whistle-blowing procedures will come into force 14 days after the publication of the act. In practice, this means that all entities should start preparatory actions for the act’s implementation even before it is adopted, to ensure they are ready to comply with the new provisions almost immediately after they become effective.

This is a significant change in relation to the previous approach, which assumed that entities employing at least 250 workers would be obliged to adopt the internal whistle-blowing procedures within two months from the entry into force of the act, and those engaging between 50 and 249 persons would have until 17 December 2023. This reduction of the deadline may seem to be too ambitious to be upheld, especially given that the corresponding obligation to consult over the internal procedure with trade union(s) (or, in their absence, representatives of persons performing work elected in the manner adopted at the given entity) should last at least seven days and not more than 14 days (which is also provided by the most recent draft). However, even if the deadlines are not as drastically reduced as outlined above, it cannot be excluded that they may still be challenging to observe given the significant delay in the implementation of the EU Whistle-Blowing Directive in Poland. Not to mention that the provisions in their current form are ambiguous in many material respects and may prove to be problematic for entities obliged to comply with them. Therefore, future developments in respect of the new provisions of Polish law implementing the EU Whistle-Blowing Directive should be carefully observed by all employers in Poland in order to ensure that they are up to speed with the rapidly changing legal landscape.

Pay Transparency Directive: Remuneration Earthquake Approaching

Member states are required to transpose the Pay Transparency Directive into their national systems by 2026. The aim of the Directive is to lay down minimum requirements to strengthen the application of the principle of equal pay between men and women, the prohibition of discrimination on grounds of sex through pay transparency, and to bolster enforcement mechanisms. As a result, employers are to face a totally new legal landscape. The requirement that remuneration terms are to be more visible and transparent to employees should be ground-breaking and this is to happen by imposing various obligations on employers and providing employees with rights to raise the curtain and ask questions. New rules will include the requirement to include remuneration (level or range for the position) in job advertisements or prior to the job interview; the obligation to make a description of the criteria to determine pay levels and careers for employees easily accessible; the right of employees to receive and request information (and to be informed of this right by the employer on an annual basis) on their individual pay level and the average pay levels, broken down by sex, for categories of workers doing the same or equal work, in accordance with set rules.

A disclosure of remuneration for enforcement of the principle of equal pay will be an option to recourse for employees and an obligation for employers. In addition, pay gap reporting will become a standard, as will compulsory pay audits. In other words, where a pay report shows a pay gap of at least 5% in any category of employee and if the employer has not justified the difference by objective and gender neutral factors, it will be necessary to pursue an equal pay audit in co-operation with employee representatives. Remedies will be required. Furthermore, claims for boosted compensation will be available for employees suffering harm as a result of infringement of their rights related to the principle of equal pay between men and women for equal work or work of equal value. Comprehensive rules will follow from the Polish law implementing the Directive (no details or prospects yet available).

Nevertheless, to avoid risk and image risk, it has become essential for employers to prepare for these important changes and start audits of their remuneration systems and introduce relevant amendments, if necessary, long before the pertinent legislation comes into force and before their remuneration terms become visible to the public.

Vast changes will be brought, together with the implementation of the Gender Balance Directive (2022/2381), initially applying only to listed companies (excluding SMEs). The transposition of this Directive must take place by 28 December 2024. However, given the lack of legal obligation to comply with gender quotas, Polish companies will face another micro-revolution. As with the pay transparency standards above, internal preparations within companies should start well in advance of the first reporting deadline, otherwise there will be reputational risk, especially in branches that traditionally have not offered executive positions to women.

S in ESG

HR departments need to prepare the “S” element of ESG, covering matters related to the employee and social issues, including soft measures. Following the implementation of the Corporate Sustainability Reporting Directive (2022/2464) on 5 January 2023 (eg, regarding equal treatment and opportunities and other aspects of working conditions), various entities will need to apply or will be required to apply EU Sustainability Reporting Standards (ESRS), reporting guidelines that should be adopted in the foreseeable future. With the adoption of guidelines, the reporting obligations will shift from elusive towards substantial. The soft ESG measures might at some point become quite similar to several internal compliance procedures, as their prevailing aim is to create a safe and sound working environment. The increased importance of various policies related to diversity and inclusion, employee well-being, as well as reporting procedures allowing prompt response and investigations, can already be observed and seem to be on the agenda of personnel departments in many companies. The inclusiveness of the workplace has become a top priority for corporations. Factors of significant importance will include matters related to workplace culture, implementation of diversity, integration and tolerance policies, awareness of employee rights, activating employees, but also linking remuneration of management staff and employees with ESG goals and, among others, implementation of the so-called “green solutions” in enterprises, as well as defining an employee appraisal system, employee volunteering, participation in social or environmental campaigns, bridging gender gaps: gender-balanced recruitment, training, promotion of the under-represented gender, and taking action to improve occupational health and safety. The benefits of reporting in the scope of “S” could involve: broader access to financial capital, identifying and managing own risks and opportunities in terms of sustainability issues, attracting employees, and customers paying attention to issues related to sustainable development, improvement of reputation and broadly understood PR.

AI Tools and the World of Work

Although disputes around the use of artificial intelligence for the benefit of the world of work have been ongoing for quite some time now, recent months have brought an increased amount of interest in the topic in Polish society. The use of AI tools is slowly gaining popularity among business sectors in Poland, with the “boom” being a matter for the future. However, certain solutions may already be used by HR departments, but always require prior careful legal review. Currently, no tailor-made legal framework has been created for the use of AI tools. It remains probable that Poland will await common EU legislation on the topic without undertaking any prior internal efforts.

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Law and Practice

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Hogan Lovells (Warszawa) LLP is one of the top law firms in Poland, offering a broad range of services and tax and legal expertise. The Warsaw office has more than 20 years' experience in advising clients. The employment practice supports clients operating in all sectors of the economy, both in Poland and abroad, and offers legal advice in all aspects of employment law. The advice covers: employment aspects of M&A as well as cross-border mergers, including the transfer of employment establishments to new employers and employee participation rights; restructuring of employment, including group redundancies; issues related to unionised and non-unionised employees; representing employers in negotiations with trade unions, collective disputes and disputes with employees, both inside and outside the courts; cross-border employment and the employment of citizens of EU and non-EU member states in Poland, including work and residency permits; and compliance, mobbing and discrimination-related issues.

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Linklaters is a leading global law firm that helps its clients achieve their strategies wherever they do business. The Warsaw office is one of the largest law firms in Poland, offering a broad range of legal services across all major practice areas. The Warsaw team is part of Linklaters’ global employment practice, which allows it to provide seamless legal support to clients on multinational matters, in particular those requiring an innovative or unified approach across various jurisdictions, and to offer clients the benefit of experience gained across the international network. The team works on the most complex and sensitive employee relations issues, including executive exits, whistle-blowing allegations, restructuring and labour disputes, and risk management. It also advises on various day-to-day HR matters. The team has vast experience advising various clients from a range of industries on many significant and complex matters in the Polish and European market.

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