New rules on redundancies and protection of union activists
A package of major revisions of labour law has been coming into force gradually in Poland since its adoption in 2002. From 1 July 2003, new rules will apply to many aspects of collective redundancies, including their definition and severance pay entitlements. Furthermore, the special protection against dismissal and detrimental treatment provided to trade union activists is to be subject to new limitations.
In 2002, the Polish parliament approved a wide-ranging liberalisation of labour law, with the stated aim of helping to fight unemployment in a more efficient way (PL0209107F). This involved a revision of the Labour Code and of a number of other legislative acts regulating the employment relationship (PL0212108F). The new provisions are being implemented on a gradual basis; most of them came into force on 29 November 2002; some on 1 January 2003; and the remainder will apply from 1 July 2003. Furthermore, selected provisions will come into force as of 1 January 2004, and the implementation of a small number of others has been deferred until Poland’s accession to the European Union later in 2004. The changes have been made despite the opposition of trade unions, which regarded them as undermining employees’ rights.
Two important new measures will come into force on 1 July 2003, relating to collective redundancies and the protection of trade union activists.
The entitlement of employees to severance benefits in the event of collective redundancies, as provided in Article 1.1.1 and 1.1.2 of the legislative Act of 28 December 1989 regarding special principles for termination of the labour relationship with employees on grounds attaching to the employing entity, is to be curtailed. Until now, all employers have been bound by law to pay out severance benefits to employees made redundant: for economic reasons relating to the employer; due to changes in work organisation, production, and/or technologies used; due to factors intended to improve work conditions or environmental protection; and in the event of bankruptcy or liquidation of the employing entity (Article 7a). As of July 2003, however, the duty to pay out severance benefits will be incumbent only on business entities employing at least 20 people. The concept of collective redundancy, furthermore, has now been defined as a reduction of employment comprising:
- at least 10 employees, where the total employment at the given entity does not exceed 100 people;
- at least 10% of the employees, where the total employment at the given entity is at least 100 people but does not exceed 300; or
- at least 30 employees, where the total employment at the given entity amounts to 300 people or more.
Significant changes have also been made to the principles governing calculation of severance payments for employees affected by collective redundancies. Up until now, the amount of the severance benefit has depended on the total length of employment of the given person. The new Article 8.2.2 of the collective redundancies Act, however, ties the amount of the severance benefit to length of service with the specific employer rather than to the length of the employee’s entire working career. It sets the following amounts:
- one month’s remuneration, where the period worked with the given employer does not exceed two years;
- two months’ remuneration, where the period worked with the given employer is more than two years but less than eight years; and
- three months’ remuneration, where the period worked with the given employer exceeds eight years.
With regard to the special protection for members of the governing bodies of trade union organisations, the changes will mean more difficult conditions for the operation of trade unions within employing entities. As of the beginning of 2003, the minimum membership for a union organisation operating within an entity required for entitlement to special employment protection was increased to 10 people. From July 2003, the list of union officers benefiting from special employment protection will be reduced considerably. Up until now, officers sitting on a company-level union organisation's board or on its 'revision commission' have been protected from termination of their employment and from detrimental changes to their employment conditions (pay etc) for the duration of their period in office as well as for a year thereafter. Article 32 of the amended legislative Act regarding trade unions, however, limits the group of protected union officials to a certain number, to be identified by the board of the union organisation operating in the given employing entity. Their number may not exceed the number of the employing entity’s managers, or it must be proportional to the overall employment at the entity. Thus, if the union organisation at the employing entity has 20 members, then two union activists will benefit from protection. The number of eligible union officials increases along with the size of the union organisation, with protection extending to:
- 10 members, for an organisation with 21-50 members in the employing entity;
- 20 members, for an organisation with 51-150 members in the employing entity;
- 30 members, for an organisation with 151-300 members in the employing entity;
- 40 members, for an organisation with 301-500 members in the employing entity; and
- 50 members, for an organisation with more than 500 members in the employing entity.
This protection applies only to members of a 'representative' union organisation, ie one which:
- belongs to a union organisation extending beyond the employing entity in question which is deemed representative (ie a membership of at least 500,000), provided that at least 7% of the employees of the employer in question are members of the union;
- has in membership at least 10% of the employees retained by the given employer; or
- failing the above, has the largest membership of any union organisations active within the given employing entity.
In the case of union organisations which do not meet any of these conditions - ie ones which are not representative - only one activist (to be named by the organisation’s board) will benefit from protection.
The period during which protection remains in force will correspond to the term of office of the union organisation’s governing bodies, plus half of that period (up to a maximum of one year) after its expiry. Up to six months’ protection will also extend to not more than three members of the founding committee of a newly established union organisation.
The latest changes confirm that the labour market in Poland is consistently becoming more flexible. Apart from this tendency towards liberalisation, another key process is that of adapting Polish law to EU standards. The reconciliation of these two processes is not easy, as indicated by, for instance, objections raised by some trade unions concerning compliance with some of Poland's new regulations with EU labour law.