Non-payment of wages in focus

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The non-payment of wages is a persistent problem in Poland, and its elimination is one of the key objectives of the National Labour Inspectorate (PIP). The latest data from the PIP show that the number of employees who did not receive their wages on time or at all fell for the first time in 2003, though the data for the first half of 2004 are somewhat less positive. The issue has been discussed recently in various tripartite forums, and in December 2004 the Polish Confederation of Private Employers (PKPP) agreed to cooperate with the PIP in eliminating this sort of practice.

A central focus of the activities of the National Labour Inspectorate (Państwowa Inspekcja Pracy, PIP) is on the perennial problem of the non-payment or delayed payment of remuneration for work (PL0307106F and PL0210105N). The basic instruments for enforcing workers’ right to remuneration that can be used by the PIP inspectors are fines and penalties. Where large-scale abuses are identified, inspectors have an obligation to inform the prosecutor’s office.

According to PIP data, the number of employers who infringed their workers’ right to remuneration in 2001 was 4,040, rising to 4,321 in 2002 and then falling to 1,930 in 2003. The number of victims of these infringements stood at approximately 200,000 in 2001, over 255,000 in 2002, and 92,683 in 2003.

The results of 649 detailed inspections conducted by PIP in the first half of 2004 show that 363 employers did not pay properly 32,826 employees. The total sum due was PLN 67,392,435. The PIP inspectors issued 14,451 decisions referring to the payment of PLN 186.3 million worth of wages and other benefits to 167,100 employees. The PIP officers used their powers to notify the prosecutor about 380 offences, 28% of which related to the infringement on workers’ rights, which mostly involved the non-payment of due wages.

Only a small percentage of notifications to prosecutors become the grounds for further court indictment and charges. Many of these cases are discontinued, and in some cases the court refuses to start proceedings. It is noteworthy from the PIP data that in only one case in 2004 was the reason for termination of the proceedings a lack of 'social harm' caused by the actions committed. In previous years, a lack of social harm was the reason for the majority of terminations in cases relating to the non-payment of wages. Prosecutors and judges are now more inclined to define the non-payment of due remuneration as 'socially harmful' offences, which may be understandable as the scale of this type of abuse is significant. Moreover, commentators argue that the silent acceptance of this type of practice produced a feeling of impunity in employers and did not prevent them from seeking to economise on workers’ pay.

Tripartite discussions

The problem of the non-payment of due remuneration and delayed payment has been tackled by a team appointed by the Tripartite Commission for Social and Economic Affairs (Komisja Trójstronna do Spraw Społeczno-Gospodarczych) (PL0210106F) to deal with labour law and collective agreements. It has also been widely discussed during meetings of the various regional social dialogue commissions (Wojewódzka Komisja Dialogu Społecznego, WKDSs) (PL0401107F). As well as the regular members of the WKDSs, these meeting have also involved representatives of the PIP and prosecutors. In the course of debates, the representatives of employers’ organisations have shared the critical opinions of the trade unions about the non-payment of wages. At the same time they emphasise that the same measures should not be applied to all employers that defer the payment of benefits to employees, as it should be taken into account that many employers are not able to fulfil their obligations toward employees due to the financial problems they face. The weak economic condition of many companies - according to the employers - is an outcome of the excessive tax burden they have to bear. In some cases of infringement of workers’ rights with respect to payment, it is argued that the employers could at most be considered the accomplices of bad fiscal policy.

New initiatives

Aside from performing its basic tasks of inspection and supervision, the PIP is making efforts to apply preventive measures, aimed at eliminating the causes of offences. This goal is to be fulfilled through organising various types of training courses and labour law counselling. However, the great majority of these efforts relate to safety at work, rather than pay issues.

The PIP also engages in cooperation with trade unions and employers’ organisations. One of the aims of this cooperation is to bring to an end breaches of the law with respect to the payment of remuneration. A good example is an agreement on cooperation for the 'protection of labour', signed on 2 December 2004 by Anna Hintz, the General Labour Inspector, and Henryka Bochniarz, the president of the Polish Confederation of Private Employers (Polska Konfederacja Pracodawców Prywatnych, PKPP). The main goal of this agreement is to ensure an effective application of legal protection in the sphere of employment relations. This is to be achieved through an exchange of information on problems occurring in enterprises and the actions undertaken in order to address these problems. The PIP and the PKPP also intend to exchange documents and opinions concerning the problems in question, and together they will propagate the principles of labour law among employers through organising training, conferences and scientific meetings, as well as best-practice competitions for employers.

Disseminating information on, and promoting the application of, labour law is seen as being of prime importance in the EU context, and especially the requirement to implement EU Directives in this area. For example, like the other EU Member States, Poland has until 8 October 2005 to implement Directive 2002/74/EC amending Directive 80/987/EEC on the protection of employees in the event of the insolvency of their employer (EU0303101F).

Commentary

The information relating to the delayed payment or non-payment of remuneration so far published by the PIP does not allow the formulation of undisputed conclusions. This is because it is difficult to say whether the decrease in the number of infringements in this area in 2003 was only a temporary slow-down, or if it was a symptom of a general decline of the phenomenon. PIP has not yet published information on the scale of infringements in 2004. Nevertheless, it can be hoped that the now widespread legal interpretation that this practice is 'socially harmful' will persuade employers against it. It is not sure, however, that the courts will grow more efficient as far as punishing dishonest employers is concerned. The key to the solution of this problem may lie elsewhere, and the general improvement of the economy may also decrease the number of employers who defer the payment of wages due to their employees. (Piotr Sula, Institute of Public Affairs [Instytut Spraw publicznych, ISP] and Wroclaw University [Uniwersytet Wrocławski, UWr])

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