The 2026 PIP reform - what are the inspectors' new powers?
In 2026, the National Labour Inspectorate (PIP) gained significantly expanded powers that may directly affect the legal position of thousands of business owners and individuals working under civil-law contracts and B2B contracts. Until now, inspectors could only flag irregularities, and the final decision rested with the labour courts. The procedure now has two stages and is far more severe.
First, the inspector issues a recommendation to remedy the irregularities. If the business owner fails to comply with that recommendation, the Regional Labour Inspector may issue a binding administrative decision on the conversion of a civil-law contract or B2B contract into an employment contract. The employer retains the right to appeal to the court, but the mere issue of the decision has immediate legal and organisational consequences.
Importantly, inspectors have also gained access to data held by the Social Insurance Institution (ZUS) and the Polish Tax Office (urząd skarbowy), which makes it easier to compare the declared form of cooperation with how it works in practice. Remote inspections have also become possible, which extends the reach of PIP even with a limited number of inspectors.
What factors indicate a hidden employment relationship?
The key concept at the centre of the whole reform is the employment relationship within the meaning of Article 22 § 1 of the Labour Code. The inspector does not assess only the wording of the contract - above all, they analyse how the duties are actually performed. Even if the parties call their cooperation a B2B contract, it will be classified as employment if it meets the statutory criteria.
During inspections, PIP inspectors pay particular attention to the following circumstances:
- Organisational subordination - working under the supervision of a superior, at fixed hours and in a designated place.
- A permanent place in the company's structure - having a company email address, taking part in team meetings, being subject to the employee appraisal system.
- A defined scope of duties and work instructions - no real freedom in choosing tasks or how to carry them out.
- Exclusivity of cooperation - a non-compete clause that prevents providing services to other parties.
- Moving from employment to B2B - continuing to perform identical duties after the form of contract changes, especially for the same client.
Meeting several of these criteria at the same time means a very high risk of the cooperation being treated as sham self-employment. In that case, both parties bear the consequences - the commissioning company and the person running the business.
The real consequences of reclassifying a contract - who is most at risk?
Reclassifying a B2B contract or a contract of mandate as an employment contract is not just a change of formal status. It brings a number of concrete and often severe financial, tax and organisational effects, which can surprise both business owners and people who have so far run a sole proprietorship.
Consequences for the business owner (the client)
A company whose cooperation is reclassified must expect an obligation to pay arrears of ZUS contributions together with interest for the whole period of the contested contract. On top of that come possible additional income tax payments resulting from the reclassification of costs, as well as the risk of administrative penalties. Over several years of cooperation with multiple contractors, these amounts can reach hundreds of thousands of zloty.
Consequences for the person working on a B2B basis
People running a sole proprietorship (JDG) may lose the right to preferential forms of taxation, such as the flat tax or the lump-sum tax. The situation is particularly serious for those who - as in publicly reported cases - received labour office grants to start a business. Reclassifying the contract may mean having to repay the grant because the condition of running the business for the required period has not been met.
The purely financial aspect should not be overlooked either - moving to employment while keeping the same total employment cost for the company means net pay for the employee that is lower by anything from over ten to several dozen per cent compared with their previous B2B earnings.
How can you lawfully protect B2B cooperation against a PIP inspection?
The new PIP powers do not mean a ban on running a business or the end of the B2B model. They do mean, however, that the cooperation must have the features of a genuine business relationship and not of a hidden employment relationship. Properly preparing the contract and the rules of cooperation can significantly reduce the risk of adverse consequences from an inspection.
In law firm practice, we recommend that business owners and people working on a B2B basis take the following steps:
- Audit of existing contracts - checking whether the contractual provisions and day-to-day practice point to features of an employment relationship.
- Removing elements of subordination - dropping rigid schedules, working time records or the obligation to provide services in person at the client's premises.
- Diversifying clients - working with more than one client clearly confirms the business nature of the activity.
- Careful drafting of non-compete clauses - an overly broad ban may be treated as a sign of dependence typical of employment.
- Documenting independence - keeping your own accounts, bearing business risk, and winning contracts independently.
It is worth stressing that the name of a contract does not determine its legal nature. PIP inspectors assess the actual terms of cooperation, so it is crucial to ensure consistency between the wording of the contract and day-to-day practice.
Will the new rules really change the labour market?
The effectiveness of the reform depends on several factors that go beyond the wording of the legislation itself. The National Labour Inspectorate has for years struggled with staff shortages and underfunding. HR experts point out that without a real increase in the number of inspectors and an improvement in their working conditions, the new powers may remain largely theoretical.
A further bottleneck is the labour courts, which are already heavily overloaded. Since every business owner has the right to appeal a Regional Labour Inspector's decision to the court, mass inspections could generate a wave of proceedings that the justice system will be unable to handle efficiently.
On the other hand, the preventive effect should not be underestimated. Simply being aware of PIP's expanded powers and of inspectors' access to data from ZUS and the tax offices may prompt many companies to voluntarily correct their employment model - before the first inspection. This mechanism may prove to be the most effective part of the whole reform.
Do not wait for an inspection - discuss your situation with a lawyer
The new PIP powers are not a distant prospect - they are law in force that can affect any company using B2B contracts or civil-law contracts. Whether you are a business owner engaging contractors or a person running a sole proprietorship, it is worth auditing your contracts now and making sure the cooperation meets legal requirements.
Contact our firm to discuss your situation and receive specific recommendations on protecting B2B cooperation. We help both companies and self-employed people prepare for PIP inspections and avoid the costly consequences of contract reclassification.
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