New developments in labour law in 2022.

The beginning of 2022 is full of changes in labour law. What's new for employers and employees this year?

Polish Deal

The beginning of the year was definitely dominated by changes in taxation and social security contributions resulting from the tax system reform (the so-called Polish Deal) and doubts related to the application of the new regulations. The changes introduced include, among others:

  • exclusion of the possibility of deducting health insurance contributions from income tax
  • the introduction of health insurance contributions paid by entrepreneurs (except for those using a flat-rate income tax) on income, rather than a flat rate as before, and a simultaneous reduction in the health insurance contribution rate to 4.9%, but only for entrepreneurs paying a linear income tax
  • extension of health insurance coverage to members of management boards and proxies receiving remuneration on the basis of a resolution of the competent authority
  • increase in the tax-free allowance from PLN 8,000 to PLN 30,000
  • increase in the tax threshold to PLN 120,000
  • introduction of a tax relief for the middle class, i.e. persons earning between PLN 68,412 and PLN 133,692 per annum
  • tax exemption up to PLN 85,528 for persons returning to Poland or transferring their tax residence to Poland, persons raising at least four children and persons continuing employment despite reaching retirement age
  • reduction of the flat-rate tax for persons conducting business activity in the IT and medical industries
  • change in the rules for calculating the car lump sum.
  • Higher minimum wage

From 1 January 2022, the gross minimum wage is PLN 3,010, which means an increase of PLN 210 compared to 2021, and the minimum hourly rate for contract work is PLN 19.70 (an increase of PLN 1.40).

The higher minimum wage will also translate into, among other things, an increase in the night work allowance and the statutory limit on severance pay under the Act on Group Redundancies (up to PLN 45,150). The earnings threshold for paying a reduced basic contribution for an employee to the Employee Capital Plan (PPK) will also be higher.

Changes in entitlement to benefits

At the beginning of the year, the rules for calculating benefit periods changed. Until now, periods of incapacity for work were included in the benefit period if the break between periods of incapacity did not exceed 60 days, provided that the cause of the incapacity was the same illness. Starting this year, the type of illness will not matter (with the exception of incapacity arising during pregnancy). All periods of absence due to illness will be added together if the break between them is no more than 60 days.

The period of receiving benefits after termination of employment will be reduced from 182 to 91 days. However, this change will not apply to incapacity for work during pregnancy or absence due to tuberculosis.

Sickness benefit for the period of hospitalisation since the beginning of this year is paid according to general rules. It will no longer be reduced to 70% of the calculation basis, as was the case previously.

The frequency of recalculating the benefit calculation basis will also increase. Until now, the benefit calculation basis was recalculated if there was a break of at least 3 calendar months between benefit periods. Starting this year, the break period in question has been reduced to one month.

Entrepreneurs will not be entitled to sickness benefit, rehabilitation benefit, maternity benefit and care benefit if they have social security contribution debts exceeding 1% of the minimum wage (i.e. PLN 30.10 in 2022) until such debt is repaid. However, if the debt is not settled within 6 months from the date of entitlement to the benefit, this entitlement will expire.

Increase in social security contributions

In 2022, the limit on pension and disability insurance contributions, amounting to thirty times the projected average monthly wage in the national economy, will continue to apply. In 2022, this will amount to PLN 177,660.

Sole traders will continue to pay social security contributions on the declared amount, not less than 60% of the projected average monthly salary (the Polish Deal does not include any changes in this respect). However, due to the increase in the projected salary compared to 2021, the amount of monthly social security contributions for entrepreneurs will increase. For persons not benefiting from any relief (including voluntary sickness insurance contributions), it will amount to PLN 1,211.28 (an increase of PLN 135.60 compared to 2021).

Coefficient for calculating holiday pay

In 2022, this coefficient will be 20.92.

Contribution to the Company Social Benefits Fund

The new year will also bring changes in the amount of the write-off per employee for the company social benefits fund (ZFŚS). This year, the write-off will be calculated based on the monthly remuneration in the national economy in the second half of 2019. It will therefore amount to PLN 1,662.97.

Employment of foreigners

At the beginning of 2022, an amendment to the Act on Foreigners will also come into force, aimed at simplifying the procedures for foreigners to obtain permits, in particular for the purpose of working in Poland. The changes include, among others:

  • replacing the requirements of having a guaranteed place of residence and a stable and regular source of income sufficient to cover living expenses with the requirement that a foreigner receive at least the minimum wage
  • expanding the list of circumstances that do not require a change or issuance of a new temporary residence and work permit and issuance of a new work permit
  • introducing solutions aimed at accelerating the legalisation of residence and work by foreigners intending to work for entrepreneurs of particular strategic importance to the Polish economy
  • extension to 24 months of the possibility of entrusting work to a foreigner on the basis of a declaration of entrusting work to a foreigner
  • shortening of certain deadlines for considering legalisation applications

What else can be expected in 2022?

17 December 2021 was the deadline for implementing Directive (EU) 2019/1937 of the European Parliament and of the Council of 23 October 2019 on the protection of persons reporting on breaches of Union law (the so-called Whistleblower Protection Directive). The provisions implementing this directive have not yet been adopted by Poland. However, work on them is already underway. It should therefore be expected that detailed solutions in this area will be adopted soon. It is therefore worth following the further work closely and preparing for this process.

In turn, Poland is required to implement the so-called work-life balance directive by 2 August 2022. The aim of the directive is to equalise opportunities in the labour market between women and men by making it easier to reconcile work and family life. Among other things, the directive introduces two months of parental leave reserved exclusively for fathers and five working days of care leave for every employee.

Further changes in the law that may appear in 2022 include:

  • guaranteeing employers the right to verify vaccination certificates and COVID-19 test results
  • regulating remote work in the Labour Code
  • regulating the rules under which employers will be able to carry out preventive sobriety checks.
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