A revolution at the National Labour Inspectorate - what changed on 8 July 2026?
From 8 July 2026, new rules have been in force that fundamentally change the powers of the National Labour Inspectorate (PIP). It is the most far-reaching reform of the labour inspectorate in years - inspectors have gained tools that until now they could only apply for through the courts. For thousands of business owners who use B2B contracts and civil-law contracts of mandate (umowy zlecenia), this means an immediate need to review how they work with their contractors.
Until now, a PIP inspector who suspected sham self-employment could only bring an action before a labour court to establish an employment relationship. Such proceedings lasted months, sometimes years, which effectively discouraged inspectors from starting them. Now the regional labour inspector can independently issue an administrative decision confirming the existence of an employment relationship - without waiting for a court judgment.
The reform is not limited to reclassifying contracts. The legislator has sharply increased financial penalties, introduced new categories of offences and created an amnesty mechanism for companies that voluntarily regularise their situation. Let us look at the details of each of these elements.
New penalty rates - how much will a business owner pay for breaching labour law?
The change in penalty rates is one of the most noticeable elements of the reform. Comparing the old and new amounts clearly shows the direction the legislator is taking - financial deterrence is meant to be real, not symbolic.
Fixed-penalty notices issued by a PIP inspector
- Before the reform: up to PLN 2,000 (up to PLN 5,000 for repeat offenders penalised twice within two years).
- After the reform: up to PLN 5,000 (up to PLN 10,000 for repeat offenders).
A fixed-penalty notice is the only financial penalty that a PIP inspector imposes alone, without involving a court. Its increase of more than twofold means that even for minor breaches the costs can be painful, particularly for smaller businesses.
Court fines under the Labour Code
- Before the reform: from PLN 1,000 to PLN 30,000 (Articles 281-283 of the Labour Code).
- After the reform: from PLN 2,000 to PLN 60,000, and in the case of repeat offending up to PLN 90,000.
Doubling the range of court fines gives courts much wider scope to impose penalties proportionate to the scale of the breach. For companies engaging dozens of people under sham civil-law contracts, the total amount of potential sanctions can reach hundreds of thousands of zloty.
A new offence - the ban on retaliation
The reform introduces an entirely new category of offence: retaliation against an employee in connection with an inspector's decision. Dismissing, or treating in any unfavourable way, a person whose contract has been reclassified carries a separate fine of PLN 2,000 to PLN 60,000. As Robert Nogacki, managing partner at the Skarbiec Law Firm, emphasises, this provision is intended to protect people who until now feared the consequences of reporting irregularities.
The mechanism for reclassifying B2B contracts as employment - how does it work in practice?
The heart of the whole reform is a two-stage mechanism for reclassifying contracts. Contrary to popular belief, the inspector does not change the contract "with a stroke of a pen”. The procedure is divided into stages, which gives the business owner an opportunity to respond at each of them.
Stage one: during an inspection, the inspector issues an order to remedy the breaches. The company can comply in two ways - by amending the defective civil-law contract so that it no longer bears the hallmarks of an employment relationship, or by concluding an employment contract with the person concerned. At this point, the business owner still has full control of the situation.
Stage two: only ignoring the order opens the way for the regional labour inspector to issue an administrative decision confirming the existence of an employment relationship. This decision has retroactive effect - from the day the person actually began work under conditions characteristic of an employment relationship.
Another important element of the reform is the interruption of the limitation period. The regional inspector's initiation of proceedings interrupts the limitation period for employee claims, while a court dispute over the existence of an employment relationship suspends the limitation period for tax liabilities. The relevant provision has been written directly into the Tax Ordinance. A strategy of dragging out proceedings therefore no longer pays off.
The appeal route - how to defend your rights?
The legislator has provided business owners with a full appeal route at every stage of the proceedings. This is key information for companies concerned about arbitrary decisions by inspectors.
In the case of a fixed-penalty notice, the business owner may refuse to accept it - the case then goes to court under the general rules. A fine is imposed by the court and the standard appeal process applies.
The most important, however, is the appeal procedure against a decision reclassifying a contract as employment. The appeal must be filed within one month of delivery of the labour inspector's decision. The inspector may uphold the appeal in full and amend the decision themselves. If they do not, they have one month to refer the case to the labour court.
As a rule, an appeal suspends the enforceability of the decision - it becomes enforceable only after the appeal deadline expires without an appeal being filed, or after a final court judgment. This means that merely filing an appeal gives the business owner time to prepare for any organisational changes.
Amnesty for companies - a chance to avoid sanctions
One of the most interesting elements of the reform is the one-year amnesty. Business owners who, within 12 months of the new rules coming into force (i.e. by 8 July 2027), voluntarily convert incorrectly used civil-law contracts into employment contracts will not be subject to the sanctions provided for in the Labour Code.
This solution sends companies a clear signal: the legislator does not want merely to punish, but above all to bring about the legalisation of employment. It is worth remembering, however, that the amnesty covers only Labour Code sanctions - it does not automatically release a company from outstanding liabilities to the Social Insurance Institution (ZUS) or the Polish Tax Office (urząd skarbowy). Any decision to use the amnesty should therefore be preceded by a comprehensive legal and tax analysis.
What should a business owner do now?
The PIP reform of July 2026 is not a distant prospect - it is law in force. Companies that work with people under B2B contracts or contracts of mandate in conditions resembling an employment relationship (fixed hours, exclusivity, managerial subordination) should take action immediately.
Above all, we recommend an audit of all civil-law contracts for the hallmarks of an employment relationship, an analysis of whether you can use the amnesty before the 12-month deadline expires, and the preparation of internal procedures in case of a PIP inspection.
Do not wait for an inspector's visit. Contact our firm to carry out a professional contract audit and prepare a strategy for adapting your company to the new rules. One meeting could save you from penalties running into thousands and from costly administrative proceedings.
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