All questions

Discontinuing employment

i Dismissal

There are three general methods by which employment agreements may be terminated in accordance with the Labour Code: termination by mutual agreement; termination with notice; and termination without notice.

Each type of employment agreement may be terminated at any time by mutual consent of the employee and the employer. In general, such terminations are not subject to the requirement to specify the cause for the termination or to consult with a trade union regarding the termination.

Statutory notice periods are the same for the employee and the employer. Payments in lieu of notice are not allowed (except in certain specific instances, when it is allowed to shorten the notice period). It is admissible to unilaterally release an employee from the obligation to perform work with the right to remuneration retained, but only during the notice period.

Termination of an employment agreement for an unspecified period upon notice by the employer requires just cause, which is defined by the courts as a reason that is true, real, specific and important enough to discontinue the employment relationship.

The reasons for termination may occur because of the employee (i.e., underperformance) or the employer (i.e., liquidation or restructuring). The employer has no duty to specify a reason when terminating fixed-term agreements.

If there are trade unions operating at the employer's business, the employer must seek the trade union's opinion regarding the intention to terminate the employment agreement for an unspecified period for an employee represented by such union. Regardless of the trade union's opinion, however, the employer is free to make the final decision to terminate the employment agreement.

The employee who has been terminated has the right to appeal to a labour court. If the labour court finds the appeal well grounded it may, in principle, reinstate the employee in the job (which also involves payment of some compensation) or award the employee damages in an amount not exceeding three months' remuneration for the given employee.

Polish labour law provides for the special protection of employment for a variety of groups of employees. In practice, the most important of them are trade union activists, employees in the pre-retirement period, pregnant women, employees on parental or childcare leave, and employees on sick leave.

In case of termination of employment for reasons not related to the employee, an employer employing at least 20 employees is obliged to pay statutory severance pay on the same terms and conditions as in a collective redundancy (see below).

The Labour Code allows employers to terminate employment agreements immediately without notice in specifically defined situations, such as a serious violation of basic employee duties.

Apart from social security registration issues, individual dismissals are not subject to notification to any government authorities. In respect of individual dismissals, there are no rehire rights. Obligatory offers of suitable alternative employment are only applicable to selected groups of employees. Social plans are not required.

ii Redundancies

Polish law provides for specific rules applicable to termination of employment for reasons not concerning employees, in particular collective redundancies. The provisions of Polish labour law regarding collective redundancy apply if the employer of at least 20 employees intends to terminate – for reasons not attributable to employees – within a period of 30 consecutive days, employment relationships with:

  1. at least 10 employees if it employs fewer than 100 employees;
  2. at least 10 per cent of the employees if it employs at least 100 but fewer than 300 employees; or
  3. at least 30 employees, if it employs at least 300 employees.

If the above limits are not met, the redundancies should take the form of individual dismissals.

In the course of collective redundancies, trade unions should be notified in writing of the contemplated dismissals. Further, the company is obliged to consult the unions regarding the intended collective redundancies. The consultation should be carried out with a view to reaching an agreement. The agreement should be concluded within 20 days and should set out the rules of handling the matters concerning the employees to be laid off (including severance and outplacement packages). If the agreement has not been reached, the company should issue a regulation dealing with the matters that were to be regulated in the agreement (the collective redundancies regulation).

If no trade unions operate within the employer's business the information should be delivered to and the consultations should be carried out with employee representatives elected for this purpose.

A contemplated redundancy is subject to an information and consultation procedure with works councils. The relevant regulations do not impose any formal requirements of such information and consultation procedure.

The company is also obliged to provide two notifications to the local employment office on the contemplated collective dismissal measures. The first notification is to be made simultaneously with the notification of trade unions or employee representatives. The second notification should be made after the consultation process has been completed.

If the company intends to terminate employment relations with at least 50 employees within a period of three months, it is obliged to agree with the local employment office on the scope and forms of assistance (outplacement) to employees who are to be made redundant.

In addition, within collective redundancies the termination of employment needs to be effected individually with respect to each employee – either a notice must be provided or a termination agreement signed with the employee. Payments in lieu of notice are required if the notice is served and the employer shortens the notice period (applicable to cases where the employee is entitled to a three-month notice period, which may be shortened to no less than one month). In the case of signing a termination agreement, payments in lieu of notice (understood as the amount equal to the salary an employee does not earn because of agreeing an immediate or a short-term employment expiration date) are allowed. In the case of collective redundancies, the employer is obligated to provide statutory severance pay. The amount of statutory severance is fixed in relation to a given employee's aggregate employment record with the employer and ranges from one to three months' remuneration for the employee. The maximum amount of the severance pay is capped in 2019 at 33,750 zlotys gross. Although this is not required under the provisions of the law, employers often grant additional compensation related to termination of employment to employees. The categories of protected employees are slightly narrower than in the case of individual dismissals. In respect of collective redundancies, there are certain limited rehire rights. Obligatory offers of suitable alternative employment are only applicable to selected groups of employees.