What the administrative decision means from 8 July 2026

A guide for employers and foreign investors hiring in Poland | ATL Law 2026

Introduction – a new chapter in employment-form supervision

The Act of 11 March 2026 amending the Act on the National Labour Inspectorate (Państwowa Inspekcja Pracy, PIP) and certain other acts – signed by the President on 2 April 2026 and published in the Journal of Laws on 7 April 2026 – introduces one of the most significant changes to the supervision of lawful employment in Poland in recent years. The core provisions enter into force on 8 July 2026, after a three-month vacatio legis. For businesses engaging contractors in Poland under B2B and other civil-law arrangements, this is the deadline by which organisations should prepare for substantially strengthened inspection powers.

Two layers must be distinguished. The reform does not prohibit B2B cooperation or other civil-law forms, and it does not change the statutory definition of an employment relationship. What it changes is enforcement – moving the point at which the nature of a working arrangement is decided away from lengthy court proceedings and towards the administrative inspection stage. For foreign investors, who frequently build operating models on flexible forms of cooperation, this means scrutinising not so much the wording of contracts as the way they are actually performed.

The core of the reform – an administrative decision, not only the courts

What remains unchanged – the substantive employment test

The reform does not touch Article 22 § 1 of the Labour Code, which has long provided the substantive test. Under that provision, work of a defined type performed for an employer, under the employer’s direction and at a place and time designated by the employer, for remuneration, constitutes an employment relationship regardless of how the parties have named their contract. Classification therefore turns on the actual content and manner of cooperation, not on the formal legal label. The test itself is not new – what is new is the procedure by which an authority may apply it.

The new power of the district labour inspector

Until now, establishing the existence of an employment relationship was in practice the domain of the labour courts, and proceedings often took years. The reform empowers the district labour inspector to establish the existence of an employment relationship by way of an administrative decision where the conditions of cooperation correspond to the features of employment, irrespective of the formal legal basis – and therefore also in relation to B2B contracts and contracts of mandate or for specific work. This creates an administrative “fast track” while preserving full judicial review of the decision.

A two-stage procedure – an order first, a decision only after

Unlike earlier drafts, the enacted model does not provide for automatic reclassification at the stage of inspection findings. The procedure is two-stage, which creates genuine room to correct a cooperation model.

• Stage one – the order: the inspector first issues an order to remedy the irregularities identified, for example by changing the form of cooperation or eliminating the features of an employment relationship from the way the work is actually performed.
• Stage two – the decision: only failure to comply with the order, or improper compliance, opens the way for the district labour inspector to issue a decision establishing the existence of an employment relationship. Independently of this route, the inspector retains the option of referring the matter to court.

The two-stage structure matters in practice: the first formal signal from the inspectorate is not yet a ruling but a call to act. Using that window for a genuine correction of the model allows a reclassification decision to be avoided.

The temporal effect of the decision – ex nunc and enforceability

One of the most important features of the enacted Act is the temporal scope of the decision’s effects. A district labour inspector’s decision establishing an employment relationship produces legal, tax and social-insurance effects from the date it is issued (ex nunc), not retroactively. The administrative decision alone therefore does not convert the cooperation backwards over its entire duration.

The decision becomes enforceable upon expiry of the appeal deadline or upon a final court judgment. The Act allows immediate enforceability to be ordered in defined cases, in particular where the decision concerns a person subject to special protection. Crucially, obtaining retroactive effects – covering the whole period during which the parties were bound by the contract – requires the district labour inspector to bring a separate court action to establish the existence of an employment relationship. The court route thus remains the only mechanism leading to retroactive effects within the employment relationship itself.

Protective standards where the terms cannot be determined

Where the circumstances do not allow the inspector to determine individual elements of the employment relationship, the Act provides for so-called protective standards. In that case an indefinite-term, full-time contract is presumed, with the place of work at the employer’s registered seat. The date of conclusion of the employment contract is taken to be the date of the decision, or in defined cases the date the inspection began. This construction shifts the practical risk of documentary ambiguity onto the engaging entity.

Appeal to the labour court and security granted ex officio

A district labour inspector’s decision does not close off the party’s ability to defend its position. An appeal lies to the labour court and must be filed within one month of the date the decision is issued. Until the case is finally concluded, enforcement of the decision is in principle suspended, save for cases covered by immediate enforceability.

At the same time, the reform strengthens the position of the person affected by reclassification. Where an appeal is filed, the court will as a rule grant security ex officio, limiting the engaging entity’s ability to amend or terminate the contract during the proceedings. The court may refuse security only where it is obvious, in the circumstances of the case, that the contract at issue is not an employment contract. In practice this means that even a successful challenge requires litigation during which the employer’s flexibility in managing the relationship is materially constrained.

Independent ZUS and tax-authority risk – a five-year horizon

Limiting the effect of the PIP decision itself to the future does not eliminate backward-looking financial risk. The Social Insurance Institution (ZUS) and the National Revenue Administration (KAS) act under their own competences and, independently of the inspector’s ruling, may pursue overdue contributions and taxes for up to five years back. A reclassification by PIP – like the inspection findings themselves – may serve these authorities as a trigger to open their own proceedings.

Under Article 38a of the Act on the Social Insurance System, contributions previously paid by a sole trader or contractor are credited against the amounts due. However, the difference between contributions calculated on the minimum base (typical for sole traders) and those due on full remuneration remains the engaging entity’s liability, increased by interest. For long-running, highly priced B2B cooperation, the accumulated arrears per individual can reach substantial figures, which often makes the ZUS and KAS exposure more significant financially than the inspector’s decision itself.

Twelve months for voluntary correction – the amnesty mechanism

The Act provides for a twelve-month period from the entry into force of the provisions, during which entities that voluntarily convert civil-law contracts into employment contracts are released from liability for prior irregularities in that respect. This mechanism is a genuine incentive to put cooperation models in order before the first inspection. It should be stressed, however, that the protective period concerns liability towards the labour inspectorate and does not eliminate the independent claims of ZUS and the tax authorities for overdue contributions and taxes. Voluntary correction reduces the risk of sanctions but does not automatically relieve the entity of financial arrears.

The individual interpretation as a safeguarding tool

Modelled on tax rulings, the reform introduces a new instrument – the ability to apply to the Chief Labour Inspector for an individual interpretation assessing a form of cooperation. The application fee is nominal. The interpretation is intended to confirm whether a given cooperation model gives grounds for a reclassification decision, and compliance with it protects against sanctions from the labour inspectorate.

The instrument should be used with awareness of its limits. The interpretation is not binding on the engaging entity and relates solely to the facts described in the application. For businesses built on numerous B2B contracts, an unfavourable interpretation may in turn increase exposure to inspection and force a costly change of model. A decision to apply should therefore be preceded by an internal audit and risk analysis.

Higher sanctions and inter-institutional cooperation

Alongside the reclassification decision, the reform raises the penalties for concluding civil-law contracts in conditions characteristic of an employment relationship. The upper limit of the fine rises from the previous PLN 30,000 to a materially higher level, and the inspector may impose a penalty by way of a fine notice. Equally important in practice is the strengthening of inter-institutional cooperation.

The reform provides for systematic data exchange between the Social Insurance Institution, the National Labour Inspectorate and the National Revenue Administration, including the use of IT systems for risk analysis and the targeting of entities for inspection. It also establishes an inter-institutional team comprising the Chief Labour Inspector, the President of ZUS and the Head of KAS, tasked with coordinating action and identifying areas of heightened risk. In practice this means that contribution and tax data may become a source for selecting targets of labour inspections.

The foreign investor’s perspective

For a foreign investor who employs or plans to employ in Poland, the reform has several practical consequences. Models built on B2B contracts – common in IT, construction and the creative-services sector – remain particularly exposed to inspection. In capital groups where a Polish company cooperates with individual contractors performing work organised by the company, correct contract wording alone ceases to be sufficient – what decides is the actual operating practice and its consistency with the declared legal basis.

Consequently, legal due diligence on market entry, or on the acquisition of a B2B-based company, should cover not only the content of the contracts but also the actual manner of cooperation: the contractors’ degree of independence, the economic risk they bear, the scope of organisational subordination, and the consistency of documentation with practice. Because the assessment is distributed across several authorities – PIP, ZUS and KAS – the risk must be analysed cumulatively rather than through the lens of the labour inspectorate alone.

How to prepare your company before 8 July 2026

The reform does not require abandoning the B2B model where it reflects genuine contractor independence. The sensible response is not an automatic shift to employment contracts, but a thorough audit of cooperation models carried out before the new provisions begin to apply. The table below indicates the signals on which inspecting authorities focus when assessing the nature of a working arrangement.

In practice, preparing the organisation should involve reviewing existing contracts and mandates for features of subordination, verifying that contract wording is consistent with how cooperation is actually performed, putting documentation in order and – where the line is thin – considering a voluntary correction of the model within the twelve-month protective window. For borderline models, applying for an individual interpretation is worth considering.

Conclusion

The reform of the National Labour Inspectorate does not create a new basis of liability; it radically changes how long-standing rules are enforced. From 8 July 2026, the burden of deciding the nature of a working arrangement shifts from lengthy court proceedings to a faster administrative inspection stage, while judicial review is preserved and the decision operates only prospectively. The greatest financial risk, however, remains with the independent proceedings of ZUS and KAS, which may reach five years back.

For employers and foreign investors, the key is to use the period before the provisions take effect for a thorough audit of cooperation models and for putting documentation and operating practice in order. The civil-law cooperation that remains safe is the one that is not only correctly designed but also ready to be defended from the first day of an inspection.

ABOUT ATL LAW

ATL Law is a law firm specialising in comprehensive support for foreign investors on the Polish market. We provide multilingual advice (Polish, English, German) in employment law, tax law, corporate law and compliance. We advise on the design and audit of B2B and civil-law cooperation models against reclassification risk, and we represent clients in inspection proceedings before the National Labour Inspectorate and in proceedings before ZUS and the National Revenue Administration. We help employers prepare their organisations for the reform that takes effect on 8 July 2026.