Reform of employment services in pipeline

Poland’s unemployment rate has been rising since 2008, reaching 13% in November 2013. Yet significant cuts to the public employment service were introduced in the 2011 budget and, to reduce the country’s deficit, the Ministry of Finance froze the labour fund. The fund, financed largely by employers’ contributions, had been intended to support training and occupational counselling. As a result of social partners’ criticism, part of the fund was unfrozen in July 2012 by the Ministry of Labour and Social Policy which then put forward its proposals for the reform of the public employment services.

Following criticism from the social partners in Poland about the reduction in spending on active labour market policies, in July 2013 the Ministry of Labour and Social Policy proposed comprehensive reforms of public employment services in Poland. The reforms would involve the support of job creation and training, targeting in particular vulnerable groups such as young people, workers over the age of 50 and parents returning to work after taking a career break to look after their family.

Background

Poland’s unemployment rate has been rising since 2008, reaching 13% in November 2013. Yet significant cuts to the public employment service were introduced in the 2011 budget (PL1210019I) and, to reduce the country’s deficit, the Ministry of Finance froze the labour fund. The fund, financed largely by employers’ contributions, had been intended to support training and occupational counselling. As a result of social partners’ criticism, part of the fund was unfrozen in July 2012 by the Ministry of Labour and Social Policy which then put forward its proposals for the reform of the public employment services.

Public employment services reform

In July 2013, proposed changes to the 2004 Act on Promoting Employment and Labour Market Institutions (in Polish) (PL0405105F) were presented by the government for consultation with social partners. The reforms include several new measures and instruments financed from the labour fund. One proposal is an efficiency-based system of financing the work of local employment agencies, awarding their employees and management resources depending on how successful they are in helping the unemployed back into work. A further suggested change is to profile the unemployed and divide them into three categories:

  • the ‘active unemployed’ with adequate skills, to be offered basic help to find jobs;
  • the ‘unemployed requiring support’, to be offered the full range of employment services, including traineeships;
  • the unemployed ‘distanced from the labour market’, including people at risk of social exclusion, or those avoiding legal employment and registering as unemployed to obtain healthcare insurance.

This last group would be offered multifaceted help to find work, using the services of private employment agencies, non-governmental organisations and joint programmes put together by public employment agencies and social welfare centres.

The proposals also contain the provision that if an unemployed person rejects a job offer, he or she will lose their unemployed status and the related benefits.

Help for parents and graduates

Further proposals include:

  • help to support the creation of jobs for parents, including the introduction of ‘telework grants’ for employers who create telejobs for unemployed parents, and also financial support for employers who take on those returning to work after parental leave;
  • preferential, long-term loans for business start-ups by university graduates, students in the final year of their studies and the unemployed, as well as similar loans for private employers who create new jobs, and for non-governmental organisations and farmers;
  • support for unemployed people under the age of 30, including training vouchers, traineeship vouchers and job mobility vouchers to cover part of the cost of job-related moves;
  • vouchers to refund a proportion of employers’ costs if they take on young unemployed workers, subsidising the first 18 months of their employment;
  • support for the employment of workers aged over 50, including a refund of employment costs up to 30% of the minimum wage.

The government also proposes to set up a national training fund, to be financed from the old labour fund. In 2014, the budget for this will be PLN 100 million (€25 million as at 13 January 2014), and it is planned that this will increase to PLN 200 million in the future (2% of labour fund resources). Until 2016, the national training fund will support employees over the age of 45 and their employers, and after this it will be available to all categories of workers.

Social partners’ views

On 10 September 2013, the Independent and Self-Governing Trade Union Solidarity (NSZZ Solidarność) made several criticisms of the proposals, saying they were not generous enough to support the unemployed in their search for work and improve Poland’s deteriorating labour market.

The All-Poland Alliance of Trade Unions (OPZZ) criticised, among other things, the idea of financing the wages and bonuses of employment service workers from the labour fund.

The Trade Unions Forum (FZZ) questioned the idea of shifting part of the responsibility for helping the long-term unemployed back into work to private employment agencies.

However, representatives of employer organisations, including the Polish Confederation of Private Employers Lewiatan (PKPP Lewiatan) and the Employers of Poland (Pracodawcy RP), questioned the limited scope for cooperation between public and private employment agencies in the proposed reforms, and warned against the danger of increasing bureaucratic burdens on public employment services.

More generally, the three union federations NSZZ Solidarność, OPZZ and FZZ proposed that control over the labour fund should be transferred to a new tripartite institution, to be known as the Social Dialogue Council. Unions have been proposing that this should replace the current Tripartite Commission for Social and Economic Affairs, boycotted by the unions since June 2013 in protest at the lack of social dialogue with the Polish government (PL1310029I).

Adam Mrozowicki, the Institute of Public Affairs, University of Wrocław

 

Useful? Interesting? Tell us what you think. Hide comments

Eurofound welcomes feedback and updates on this regulation

Dodaj komentarz