Legal alert: Changes in employment law in 2022

Employment of non-Polish nationals

• Introduction of the maximum 60-day period for the first instance processing of temporary residence permit applications and a 6-month period for processing permanent residence permit and EU long-term residence permit applications. The appellate procedure for all of the aforementioned permits must be completed within 90 days.
• All temporary residence and work permits (for up to two years) will be issued under an accelerated procedure, provided that the procedure was initiated before 1 January 2021 and the required conditions have been met.
• The requirement to show proof of residence and a source of income has been waived. Currently, it is sufficient to receive a salary of at least the minimum salary.
• Currently, it is assumed that a non-Polish national meets the mandatory medical insurance (NFZ) requirement when the joint residence and work permit is issued.
• The period of employment of a non-Polish citizen under declaration on entrusting work to a non-Polish national (i.e., Ukrainian, Belarussian, Russian, Georgian, Armenian and Moldavian) has been extended (from 6 to 24 months).

The minimum salary

The minimum monthly salary has been increased and in 2022 is PLN 3,010 gross (PLN 2,800 in 2021). Consequently, the minimum gross hourly rate has also been increased from PLN 18.30 to PLN 19.70. This rate applies to contractors / service providers.

Polish Deal [Polish: Polski Ład]

Key changes include:

• a new tax-free amount of PLN 30,000 (PLN 8,000 in 2021)
• increased tax threshold - 32% tax rate applied to annual income exceeding PLN 120,000 gross
• new tax exemptions introduced, inter alia:
  • relocation relief - applies to taxpayers relocating back to Poland (and changing their tax residence)
  • tax relief for parents with 4+ children
  • tax relief for working pensioners who do not collect their pensions yet despite being eligible to do so
• no option to deduct health insurance contributions from personal income tax
• tax relief for the middle class - applies if total annual revenue is between PLN 68,412 and PLN 133,692 gross (i.e., PLN 5,701 to PLN 11,141 gross monthly)
• company cars are now settled differently

Preventing illegal employment

The Polish Deal has introduced solutions preventing unofficial employment without the disclosure (of all or part of) employee salaries to the tax authorities.

From 1 January 2022 all taxes and insurance contributions are borne solely by employers. Employees bear no consequences.

A revolution in benefits

The new provisions focus mainly on sick pay and include:

• the basis for calculating sick pay for a period of hospitalisation - the rate of 70% of the assessment basis has now been increased from 70% to 80%;
• sick pay after termination of insurance (i.e. employment contract) – previously under the old rules, sick pay could be received for 182 days now 91;
• determining the benefit period - from the beginning of 2022, when determining the benefit period, the reason for incapacity for work before and after the break is irrelevant, and if the break is shorter than 60 days, even a new illness will not result in the need to calculate the benefit period anew;
• delays in payment of contributions - from 2022, voluntary sickness insurance will not be terminated due to late payment of contributions, as was previously the case, even if the delay was as short as one day.

The Whistleblower Act

The Whistleblower Act is expected to be implemented in the first quarter of 2022. However, despite the deadline to implement the Whistleblowers Protection Directive having expired, the final version has yet to be adopted by Poland.

New employer malpractice

Employers who obstruct pending alimony enforcement proceedings against their employees, e.g. by failing to conclude written employment contracts with their employees, may be subject to fines between PLN 1,500 and PLN 45,000.

Bird & Bird constantly monitors legislative changes affecting HR and employment issues. We will keep you updated on any further changes.