New powers for the National Labour Inspectorate (PIP) - what changes from 2026?
In July 2026, an amendment to the Act on the National Labour Inspectorate came into force, fundamentally changing the rules for inspecting employment in Poland. Until now, only labour courts could establish the existence of an employment relationship in place of a civil law contract. This power has now also been given to labour inspectors, who can issue binding administrative decisions in such cases.
The second groundbreaking change is the introduction of a risk analysis mechanism. It consists of the systematic exchange of data between PIP, the Social Insurance Institution (ZUS) and the National Revenue Administration (KAS). As a result, inspectors can precisely select for inspection companies suspected of sham self-employment - in particular where the entrepreneur issues invoices to only one client.
The reform stems from Poland's commitments set out in the National Recovery Plan (KPO). EU institutions have pointed for years to the problem of segmentation in the Polish labour market, that is, the existence of parallel forms of employment with different levels of tax and contribution burdens. The previous PiS government originally planned to bring civil law contracts fully within the social contributions system, but the current coalition - in agreement with the European Commission - replaced this milestone with strengthened powers for PIP.
Is this the end of B2B contracts? When will an inspector challenge a contract?
Contrary to the fears of many entrepreneurs, B2B contracts are not being banned. Cooperation between two business entities remains fully legal. However, inspectors may challenge a B2B contract where in practice it replaces an employment contract - that is, where it amounts to so-called sham self-employment.
The key factors are the indicators of an employment relationship set out in Article 22 § 1 of the Labour Code. A labour inspector will examine the factual situation, not the wording of the contract. As the former Chief Labour Inspector Marcin Stanecki put it: "Paper will bear anything, but it is not the wording of contracts that will determine our decisions".
A B2B contract will be challenged where the self-employed person in reality:
- performs duties personally, with no option to delegate them to someone else,
- works at a specified place and time set by the client,
- is subject to the direction of the contracting party - receiving ongoing instructions on how to perform the work,
- does not use their own equipment and does not organise their work independently,
- does not bear the real business risk of running a business,
- receives a fixed remuneration irrespective of results.
Similar rules apply to contracts of mandate (umowy zlecenia) and contracts for specific work (umowy o dzieło). None of these forms is eliminated, but they will not be usable to replace regular employment.
The inspection procedure step by step - from a "yellow card" to a decision
The reform introduces a two-stage enforcement mechanism that gives businesses time to adapt to the legal requirements. Inspectors will not be converting contracts "on the spot".
Stage one - an order to remedy irregularities
First, the inspector issues a so-called "yellow card" - an order to remedy the infringements identified. The parties then have a choice of two paths: entering into an employment contract or changing the terms of cooperation so that they reflect the real relationship between two independent businesses. Importantly, PIP can also analyse documents remotely, without a physical visit to the company.
Stage two - a decision to convert the contract
If the parties do not comply with the order, the inspector applies to the regional labour inspector for an administrative decision converting the civil law contract into an employment relationship. Both the worker and the employer have the right to appeal within one month of that decision. Enforcement of the decision may be suspended until the labour court rules, unless the inspectorate grants it immediate enforceability - reserved mainly for specially protected persons, such as pregnant women.
Financial and legal consequences of conversion
The employment relationship will arise on the date the decision is issued, but the actual obligation to pay contributions and taxes will shift to the moment the decision becomes enforceable. As attorney Joanna Stankiewicz of the law firm Dudkowiak & Putyra explains, PIP decisions cannot have retroactive effect - establishing the consequences for an earlier period requires a separate court claim.
Breaching the new rules carries a fine of PLN 2,000 to PLN 60,000 (previously PLN 1,000 to PLN 30,000). The legislator has, however, provided for a one-year amnesty - anyone who voluntarily replaces a civil law contract with an employment contract will avoid financial penalties.
Scale of the changes - how many entrepreneurs will the PIP reform affect?
According to estimates from the Ministry of Finance, there are currently around 160,000 sham self-employed people in Poland. The ministry calculates that every 10% of B2B contracts converted into employment contracts will bring the state budget more than PLN 200 million a year in higher taxes and contributions. The real scale of the changes, however, depends on PIP's organisational capacity and the strategy of the new Chief Labour Inspector.
The inspectorate has announced that in the first phase it will respond primarily to complaints from those concerned - a complaint template is already available on the PIP website. This does not mean, however, that inspections will not be initiated by the authority itself. The risk analysis mechanism enables the automatic selection of companies where the indicators clearly point to sham self-employment.
The reform does not concern only the IT sector, with which B2B contracts are most often associated. Inspections may also cover sectors such as marketing, consulting, construction, transport and creative services - wherever engagement through sole proprietorships is common.
How to prepare? Practical tips for businesses and the self-employed
The new rules need not mean problems if B2B cooperation reflects a real relationship between businesses. It is nevertheless worth carrying out an audit of existing contracts and employment practices now. Here are the most important steps:
- Review of B2B contracts - check whether the contractual provisions and day-to-day practice contain elements characteristic of an employment relationship.
- Verifying the independence of the contractor - make sure the contractor organises their own work, uses their own tools and bears business risk.
- Eliminating features of subordination - avoid setting fixed working hours, a fixed place for performing services or issuing ongoing work instructions.
- Diversifying the contractor's income - working exclusively with one entity is one of the strongest warning signals for PIP.
- Using the amnesty - if the current contract in fact meets the criteria of an employment relationship, voluntary conversion within a year will allow you to avoid penalties.
The PIP reform is the most significant change in Polish labour law in years. Both employers and sole proprietors should treat it as an incentive to put their employment relationships in order - before an inspector does it for them.
Do you need a professional analysis of your B2B contracts or help preparing for a PIP inspection? Contact our firm - we will help you assess the legal risk, adapt your contracts to the new requirements and effectively represent your interests in proceedings before the labour inspectorate or a court.
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