“PIP decisions with immediate execution”. Does this threaten B2B contracts?

The planned extension of the State Labor Inspectorate's powers is a revolution in relations of companies with colleagues and can affect the functioning of thousands of enterprises in Poland – believes Eliza Skotnicka, Senior Manager at the People Advisory Services Tax team, EY Polska.

As announced by the Ministry of Family, Labor and Social Policy, a bill is to be created by the end of August, on the basis of which PIP is to gain the possibility of independent transformation of civil law contracts – including B2B – in the employment contract, if the inspector finds that the terms of cooperation correspond to the premises of the employment relationship.

These decisions will have a rigor of immediate enforceability, which means that they will apply immediately – regardless of a possible appeal to the court.

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In the opinion of Eliza Skotnicka, a senior manager in the People Advisory Services Tax, EY Polska team, this is a huge change that can affect the functioning of thousands of companies in Poland.

The inspections will be able to be carried out remotely, based on data from ZUS and KAS, and inspectors will gain access to modern analytical tools. Although the purpose of the changes is to protect employees against abuse, the lack of precise criteria for assessing the “fictitiousness” of self -employment raises concerns on the part of entrepreneurs – wrote Eliza Skotnicka in a commentary sent by PAP Biznes.

“The discretionary decision of the inspector can lead to sudden changes in the employment structure, which in the case of companies based on a flexible cooperation model – e.g. in IT, consulting or creative sector – may mean serious operational interference,” she added.

EY Polska expert points out that changes do not mean that mandate or B2B contracts will cease to be safe and lawful.

“Companies that have been honestly and transparent from the beginning with their model of employment, have well -documented foundations of cooperation, which actually deviates from the legal and work relationship and are able to defend their arguments – should come out of this situation with a defensive hand” – she wrote.

The key will be to prepare for possible inspections, review of documentation and make sure that the method of cooperation and the relationship with the contractors/contractors is consistent as to the content and form with its name contained in the mandate contract or for the provision of services, and is not only a “smoke veil” – added Eliza Skotnicka.

Poland is one of the leaders in Europe in terms of the participation of self -employed – in 2023 it was 19.9 percent, which means nearly 3 million people.

“For many of them it is a conscious choice, resulting from the need for flexibility, tax preferences and professional independence. Self -employment can also be an effective tool of professional activation of people 50+, which often do not find themselves in traditional employment structures” – wrote EY Polska.

EY, together with Giglyike, has been conducting research (gigbarometer) regarding the flexibility of the labor market in Poland for three years. Analyzes show that a model of cooperation based on flexibility – including B2B – is not a temporary fashion, but a lasting trend.

“It is important that the new regulations do not undermine confidence in this model as a legal and effective form of cooperation,” wrote Eliza Skotnicka. (PAP Biznes)

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