Forms of employment in Poland
Employers may hire employees based on various forms of employment. This may include an employment contract, a contract for providing services as part of a business activity (B2B contract) or a mandate contract. In some situations, it is also possible to use temporary workers under an agreement with an employment agency. The key differences between various forms of employment concern the parties’ obligations, the amount of taxation and the methods of terminating cooperation.
However, employers do not have complete freedom when choosing a given type of contract. First of all, an employment contract is mandatory when there is strict subordination of the subordinate; in particular, he is obliged to perform work in the manner, at the time and the place indicated by the employer. Employment contracts may be concluded for an indefinite or fixed period, but the employment of a given employee for a set period may not exceed a total of 33 months. Perpetual employment contracts are treated as the most stable and often the most desired by job candidates. Both of the above types of employment contracts may be preceded by an employment contract for a trial period of a maximum of 3 months.
Contracts for providing services by sole proprietors (B2B contracts) are usually used when the employee has more freedom in choosing the method and time of work. Therefore, they are selected in industries where there is a need for greater flexibility or work is to be performed less continuously. In practice, they are prevalent among advisors, freelancers, IT specialists, etc. Usually, these contracts allow for lower taxation and contributions. At the same time, the principles arising from labour law, e.g. provisions on employers’ obligations and employee protection, do not apply to them. Concluding a B2B contract requires the employee to set up a business and settle taxes and ZUS contributions independently. Mandate contracts are often concluded when the work is to be performed for a shorter time or a partial number of hours. Therefore, they are often used for interns or people who work extra hours.
In turn, companies usually use temporary workers at the beginning of their operations or in the event of a short-term increased demand for work. Standard quick work is associated with significant limitations; in particular, a person can only be employed for up to 18 months, covering the next 36 months.
To sum up, Polish regulations provide quite a wide range of employment opportunities. The choice of the appropriate form should be primarily dictated by the planned period of employment, the nature of the work and the conditions in which specific activities are performed.
Magdalena Chochowska
Senior Associate, Baker McKenzie
Magdalena Chochowska, Senior Associate, Baker McKenzie
