Is the era of unfair practices in the labour market coming to an end? The National Labour Inspectorate (PIP) is set to receive new powers that could radically change the situation of people employed under civil law contracts. The changes announced as part of the revision of the National Recovery Plan (KPO) involve strengthening the powers of PIP and introducing mechanisms that allow civil law contracts to be reclassified as employment contracts.
Why are the changes necessary?
According to the Ministry of Funds and Regional Policy, the current employment system in Poland is characterised by labour market segmentation, which leads to some workers being excluded from social security protection. Although applying social security contributions to all civil law contracts was meant to be one of the key points of the reforms, an alternative solution was chosen - strengthening the National Labour Inspectorate.
The aims are to:
- Increase workers' social security protection.
- Reduce abuse in the use of civil law contracts that in practice meet the criteria of an employment relationship.
- Make it easier to move to employment contracts.
What will change in practice?
The most important changes involve:
- Reclassifying civil law contracts as employment contracts - PIP inspectors will be able to determine on their own that a given civil law contract meets the criteria of an employment relationship and reclassify it.
- Counting length of service - Experience gained under civil law contracts will count towards length of service.
- Support for artists - People with low and irregular incomes will be able to count on support with paying contributions.
- Strengthening PIP's capacity - The Inspectorate is to be better equipped with resources and powers so that it can eliminate abuse in the labour market more effectively.
What about social security contributions on all contracts?
The decision to drop full social security contributions on civil law contracts stems from concerns about the negative impact on the labour market. The document stresses that:
- In Poland, only a small percentage of workers (approx. 0.01%) are not covered by social insurance.
- Burdening employers with additional costs could worsen the country's economic situation, particularly given rising labour costs (up 12% year on year in Q3 2024).
Expert opinions
The announced changes have prompted mixed reactions. On the one hand, the ability for PIP to reclassify contracts is a powerful tool that could limit abuse. On the other, critics argue that such a solution is merely a "sticking plaster", and that the problem requires comprehensive reform of labour market legislation.
What next?
The draft changes have been sent for consultation, which will run until 27 January. The Council of Ministers is due to consider the document on 28 January, and the formal request to revise the KPO will be submitted to the European Commission by the end of January. If the European Commission and the Council of the EU approve the changes, the amended legislation could enter into force by 30 June 2026.
Summary
The new powers for the National Labour Inspectorate could be a breakthrough step in tackling pathologies in the labour market. If the proposed changes are introduced, workers will gain greater security, and unfair practices linked to civil law contracts may become a thing of the past.
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