[Poland] PIP will gain new powers – the aim is to combat fictitious self-employment

According to the draft bill under development, The State Labour Inspection (PIP) may receive new powers. PIP will be able to order the transformation of an existing civil law contract into an employment contract.

New competences – PIP will order a change to the contract

PIP together with the Ministry of Family, Labour and Social Policy (MRPiPS) are developing a draft amendment to the regulations aimed at enabling the State Labour Inspection to combat fictitious self-employment. This involves an order to convert a B2B contract, a contract of mandate or a contract for specific work into an employment contract.

Current regulations define only one way to change a civil law contract into an employment contract, and that is to file a lawsuit to determine the existence of an employment relationship. However, a labour inspector may file such a lawsuit on condition of cooperation with the employee, and employees are often afraid to file a lawsuit against their employers.

Meanwhile, according to the proposed solutions, the labour inspector will be able to issue an administrative decision ordering the employer to transform a civil law contract into an employment contract with immediate effect. The only grounds for such a decision are the features of the employment relationship.

Employment in Poland – statistical data

According to data from the latest edition of the Central Statistical Office publication – Economic activity of the Polish population – 1st quarter of 2024 – in the 1st quarter of 2024, economically active people constituted 58.5% of the population aged 15-89, and 16,053 thousand (i.e. 93.4%) people worked full-time, while 1,141 thousand (i.e. 6.6%) worked part-time.

The number of inspections carried out by the State Labour Inspection is growing year by year. In 2023, inspectors carried out over 61,000 inspections at almost 50,000 employers. 40,717 civil law contracts were inspected, and labour inspectors questioned 1,852 of them. See also: PIP – number of labour rights violations and penalties imposed on employers on the rise

Hiring staff and E-File – how can we help?

In the face of the upcoming changes, entrepreneurs should primarily review employment in the organization in terms of the form and content of contracts. This will allow them to avoid potential risks when the new regulations come into force.

In cooperation with a law firm from our Group – TGC Corporate Lawyers – we offer comprehensive support in the field of labour law.

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Moreover, currently in the era of increasing digitalization, it is worth considering switching to an electronic form of storing and managing employee documents. Thanks to e-documentation, or E-file, you will save time, reduce costs and provide your company with full data security and quick access to them for HR department employees and team managers.

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