Changes in fixed-term contracts in Poland in 2016
In the world of work fixed-term contracts make sense when there is a factual reason for limitation of one’s employment time. This can be e.g. the need of the company, when employees should be hired only for the duration of a project. Normally, the cooperation between the employer and the employee should be based on an employment contract concluded for an indefinite period of time.
During recent years an enhanced tendency could be observed in Poland, an employers’ tendency to make contracts limited to several years with their employees. Often there was no factual reason. In the past it often led to situations, in which employees, when being dismissed, had to be content with a two-week period of notice, irrespective of their period of employment. Colleagues with open-ended contracts had it better.
Depending on their duration of employment they could benefit from longer notice periods that are provided by the Polish Labour law. In 2013 the European Commission has already reprimanded the Polish Government for this discrimination against employees with temporary contracts. A year later the European Court of Justice found in the case C-38/13 that the rules of the Polish Labour law on shorter notice periods in temporary contracts are incompatible with the corresponding European legal provisions of the Framework Agreement on temporary contracts in the annex to the Directive 99/70/EG of 28 June 1999.
Change of the Polish Labour Code
The Polish legislator has reacted by enforceing over the last few weeks considerable changes in the provisions on temporary contracts in the Polish Labour law. The starting point here is that there are now only three types of employment contracts in Poland: the employment contract concluded for an indefinite period of time, the temporary contract as well as the employment contract for a trial period.
Employment based on fixed-term contracts
Up to now, the Polish Labour law stated that the third fixed-term contract concluded one after another causes legal consequences of an open-ended contract, if the period of time between the cancellation of the previous contract and the signing of the following contract is no longer than a month. After tough negotiations of social partners it has been agreed that in the future the employers are allowed to hire their employees on the basis of fixed-term contracts during the period of 33 months at the most, whereby during this time three fixed-term contracts are allowed to be signed. Both the beginning of the 34th month of cooperation and the signing of the fourth fixed-term contract lead to the situation, in which the employee is entitled to the rights that come with an open-ended contract.
There are, however, exceptions: the time-limit of 33 months is not applicable, when the employer wants to hire employees that would provide temporal or seasonal work, as well as when a fixed-term contract is signed with an employee that replaces temporarily another employee during his or her justified absence. Furthermore, it is possible to employ managers as well as members of the Executive Board of Polish capital companies for the period of their cadence in the corporate bodies of these companies, without being restricted by the above-mentioned temporal limitation.
What remains to be seen is how the fourth exception will be dealt with in the future by employers and Labour courts as well the National Labour Inspectorate. The time-limit of 33 months is also not applicable, when the employer can name objective reasons laying on his side that justify hiring employees on the fixed-term basis for longer than the above-mentioned time-limit. However, the amending law does not contain an indication as to the reasons that could be of importance. On the contrary. As a further condition for application of the exceptions it is pointed out that the execution of a long-time fixed-term employment contract without complying with the 33-months-regulation should be permissible, when it serves the factual fulfillment of needs limited in time and is indispensable in the light of all of the circumstances upon conclusion of the contract.
Specification of admissibility of the employment contracts for a trial period
As yet, a probationary employment contract can be signed for a maximal period of three months. The probationary contract is now legally defined as a contract that is signed with an employee in order to examine his or her qualifications as well as the possibility of employing him or her to perform a certain kind of work. What was previously disputed in jurisprudence and legal literature, is now set by law: the admissibility of signing another probationary employment contract, when the employee should be hired for another workplace that is not covered by the first probationary period.
Changed notice periods
The change of the Polish Labour Code unifies notice periods, which for both open-ended and fixed-term employment contracts come to:
- for a duration of employment of less than 6 months – 2 weeks,
- for a duration of employment of at least 6 months – 1 month, as well as ,
- for a duration of employment of at least 3 years – 3 months.
Employee’s release during the notice period
Until now, because of a missing legislative provision, an employee’s consent was necessary to release him or her from the duty of performing work during the notice period. It has been changed by the amendment of the Polish Labour law. Now, the Polish Labour Code contains a regulation, on the basis of which the employer can one-sidedly grant such a release. The employee is entitled to payment during the notice period.
With the introduction of the changes in the Polish Labour Code discussed above, the Polish legislator fulfils important postulates both of the European Commission and the Polish social partners. While in some areas the employers are given more legal security (e.g. in the admissibility of probationary contracts), elsewhere the legislator, by using vague legal concepts, is making this security lack (see the exceptions to the 33-months-regulation). What remains to be seen here is how the National Labour Inspectorate’s and the Labour courts’ practice is going to develop in the future.
The amending law will come into force on the 22th of February 2016.
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