Katarzyna Małaniuk

Attorney at law (Poland)
Senior Associate, Manager
Phone: +48 61 624 49 69

2018 has not been an easy year for enterprises because of the numerous changes to laws and tax regulations. The first half of the year was dominated by the preparations for the GDPR. Now enterprises will have to prepare for the electronic filing of financial statements, the split payment mechanism and, last but not least, they have to think over the compliance act. Therefore, it came as a surprise that the lawmakers started working on a completely new Labour Code and a Collective Labour Law Code.  

The media have recently reported that the Codification Committee has proposed a new Labour Code and a new Collective Labour Law. Code. On 14 March 2018, the Chairman of the Labour Law Codification Committee, Marcin Zieleniecki – Deputy Minister of Family, Labour and Social Policy, announced that the Committee completed their work and adopted two drafts: the Labour Code and the Collective Labour Law Code.

The drafts gave rise to controversies already at the committee stage as 10 out of 14 Codification Committee members voted for their adoption, but against it voted experts representing workers (NSZZ „Solidarność”, OPZZ) and employers (Pracodawcy RP).  

The Labour Law Codification Committee was established in 2016 and consists of 14 members – 7 representatives appointed by the Minister of Family, Labour and Social Policy and 7 selected by the employers’ organisations and trade union organisations represented in the Social Dialogue Council.

Controversial proposals by the Codification Committee

The proposals of the Codification Committee have not been made public, but have provoked reactions from employers as well as employees nonetheless. According to media reports, nothing less than a labour law revolution has been planned. The below list of amendments to the labour law has been developed on the basis of media publications and reports. 

1. Changes in granting holiday leave:

a) The holiday leave to be extended to 26 days per year for all employees.
b) The outstanding holiday leave to be used by January of the following year at the latest.
c) If holiday leave is not granted on time, the entitlement expires. However, the employee is entitled to compensation equal to 2 times the holiday pay which would be due if the holiday leave was granted on the latest possible date.
d) The holiday leave entitlement to be calculated in hours (although usually granted in days).

2. Changes in the forms of employment:

a) No option to hire under civil law contracts, including contracts of mandate and contracts for specific work.
b) An employment contract (an employment contract for a trial period, a fixed-term employment contract, an employment contract for indefinite time, a seasonal employment contract, an employment contract for casual work, an on-call contract) or self-employment (reserved for specialists) to be the basis of employment.
c) An option to conclude a fixed-term employment contract only in exceptional situations, e.g. a replacement contract and for a period not longer than 18 months, while allowing a collective agreement to extend that period. However, the above-mentioned restriction would not apply to contracts which due to special reasons may currently be concluded for longer. In these cases, neither a restriction as to the time for which such contracts are concluded nor the limit on the number of such contracts would apply.
d) Trial period to last half a year.
e) Seasonal employment contract to be concluded only for a maximum of 30 days. 

3. Other proposals:

a) Modified provisions related to the employers’ responsibility for sick pay by shortening the period payable by employers, especially in the case of short-term contracts.
b) Obligation to justify the termination of contracts concluded for a fixed term.
c) Termination of an employment contract would require to hear the employee out (where more than 10 employees are hired).
d) Remuneration components not to be discretionary (excluding bonuses).
e) Overtime to be allowed upon the employer's written order only.
f) Collective agreement to provide for the option to establish special payroll accounts where the money for overtime would be deposited (it could be paid out in specific situations).   
g) Leave upon request to be notified 24 hours before its beginning at the latest.
h) Self-employment to be partly protected by the Labour Code.
i) Doubts whether the hiring is based on self-employment or an employment contract to be settled in favour of the employment contract.

Standpoint of the government and the Minister of Family, Labour and Social Policy

Although the Committee’s proposals were never made public, a government representative promptly reacted to them indicating that the governing party was not working on any changes to the Labour Code and would not support the Committee’s proposals. Nevertheless, uncertainty remained. 

After a month, that standpoint was officially confirmed by Elżbieta Rafalska, the Minister of Family, Labour and Social Policy. At the conference held on 13 April 2018, the Minister stressed that the Committee’s work was valuable and “will be revised, adapted and used for a draft amendment of the Labour Code”, especially as regards the working time and solving collective disputes. She also added that they could not imagine the new provisions to be adopted against the will of the society. Therefore, the government would not continue the work as proposed by the Committee and the changes to the labour law would be introduced by consensus of all stakeholders.

What will happen to the work on the Labour Code reform?

Regarding the work on the Labour Code reform, Minister Rafalska emphasised that at the beginning it would concentrate on assessing the impact of the proposed regulations. This would take approximately three months. As for now, concrete solutions are to be presented at the end of 2018. 

This means that the lawmakers will amend the Labour Code (especially as regards the working time) most probably still in 2018. However, the changes will only modify some of the existing provisions and no new, revolutionary labour code will be adopted.

We will keep you updated should any changes occur. If you have additional questions concerning this topic, the experts of Rödl & are at your disposal.