Large undertakings with their registered seats in one of the European Union Member States, especially those from Western Europe, use the experience of their employees willingly in order to support the development and the activities of their subsidiaries or local offices located in Poland. When temporary visits of such workers in Poland prove to be insufficient, they remain in our country for a longer period of time until a completion of the tasks entrusted them by their respective employers.

Very frequently workers of foreign employer (for example: managers or high-class professionals) do not want to be bound by an employment contract with an entity operating in Poland, to which they have been delegated preferring instead to carry out their work under an employment contract executed with their foreign employer. If the work in Poland is to be carried out in the long-term outlook and in accordance with the labour law of a particular state deploying a worker on a business trip is out of question, it is necessary to formally post them to work in Poland.

Posting an EU citizen to work in Poland may in fact come into being within the scope of a business trip or a posting that is not a business trip. The above distinction is important because of different effects within the scope of taxation and the social security of employees deployed on a business trip or posted to work in Poland. Although the provisions in EU legislation (Directive 96/71/EC of the European Parliament and of the Council of 16 December 1996 concerning the posting of workers in the framework of the provision of services) contain  no definition of the posting, it shall be regarded to constitute as a provision of a worker?s obligations in an area other than a permanent place of work over a prolonged period of time. The provisions of law of the Member State where an employer of a worker that is being posted has their seat shall generally be taken into account when resolving an issue of distinguishing between the two abovementioned forms of deployment of a person to work in Poland.  Generally speaking, it is an EU employer that should determine whether under the law of their state a period of time during which the work will be carried out as well as the other circumstances of the case require (or not) that a worker be posted to work in Poland and not just sent on business trip.

I will briefly present below the most important issues that will arise in case of posting of a worker employed in a Member State of the European Union to work in Poland. They will include:
1. A documentation of the posting; 2. A law governing the employment contract of the posted worker; 3. A registration of stay in Poland of an EU citizen; 4. A taxation of the posted worker by an income tax; 5. An obligation of the posted worker to pay social security contributions.
I will deal with the first two issued in this entry, while the other one will appear on our blog in the next few weeks.

Posting documentation

Given the posting to work in Poland, a documentation of an EU employer that posts a worker should contain a formal confirmation of a temporary change of place of work for a  specific place in Poland. The posting shall be carried out in accordance with the law in force in the Member State in which the employer has their registered seat. This is usually done by means of a so-called letter of posting, signed by the worker who in such a way expresses their consent to the conditions of the posting or by means of an annex to their employment contract. In addition, the foreign entrepreneur should discharge all information obligations in relation to their employees, if those are provided by the law in force in the Member State competent for the employment contract.

From a standpoint of Polish law and practice of the Polish labour inspection, it is important that workers posted to Poland have a document (for example, a letter of posting) or annex to their employment contract, from which it explicitly appears that they are employed by the foreign entrepreneur but their workplace is located in Poland. The document should also include an information concerning an indication of the period of posting and of the remuneration. The lack of such a document creates a risk that the fiscal authorities or the labour inspection or indeed Polish Social Insurance Company find that the foreign entrepreneur?s workers are actually illegally employed by the entity operating in Poland.

The law governing employment contracts

According to the Rome Convention of 19 June 1980 on the law applicable to contractual obligations, it is the principle that the law of the EU Member State in which the entrepreneur who is the employer has the registered seat will be applied to the employment contract of the EU citizens posted to work in Poland (assuming that other law was not chosen by the parties of the employment relationship). The exception to this rule will be provided by a  situation where the circumstances of a given  case show that the employment contract has closer ties with a state other than a state of the employer?s registered seat. In such a case, the law of that state shall be applied. In practice, that is a rare case.

Despite a competence of a foreign law, in accordance with the regulations of article 67? and article 67? of Polish Labour Code, an employer with a registered seat in the European Union Member State, that posts a person to work in a local office (branch)  located in Poland, has a duty to provide them with the conditions of employment that are not  less favourable than those arising from the provisions of Polish Labour law, within a scope envisaged by those provisions. The obligation to provide conditions of employment that are not less favourable than a minimum determined by the Polish labour law shall apply to:
1. norms and times of work periods as well as  daily and weekly rest periods,
2. times of annual holidays,
3. minimum rates of pay,
4. rates of an additional remuneration due for overtime work,
5. health and safety and hygiene at work,
6. workers? entitlements related to parenthood,

7. conditions of employment of young people  as well as carrying out work or other gainful  activities by a child,
8. prohibition of discrimination in employment,
9. carrying out work in accordance with the rules on temporary workers? employment.
The above means that workers employed by the EU employer and posted to work in Poland, notwithstanding the provisions contained in their employment agreements and the reading of the provisions of the labour law governing their employment contracts, will benefit from the advantages provided by Polish labour law within the abovementioned scope. However, it should be recalled that such a general principle shall under certain conditions be subject to limitations when it comes to workers carrying out an initial assembly or installation jobs  outside of the scope of the construction industry.
As you can see the posting of workers from the EU Member State to Poland requires a knowledge of both of that state?s labour law and Polish law as well. Thus, usually in case of  such a posting a cooperation of specialists in labour law of the Member State of the European Union where an employer has a registered seat and professionals in the Polish labour law takes place. It applies in particular to identifying any potential discrepancies between the provisions of labour law in both countries so that the employer and the worker  are aware of the extent to which Polish labour law regulations setting out the minimum entitlements of a worker will apply to an employment contract executed in accordance with a foreign labour law.

That is all for today. We will continue a subject matter concerning the posting of workers who are citizens of the European Union to work in Poland in our next articles.

This entry was posted on Wednesday, 30-12-2009 at 12:01 by Katarzyna Niedźwiadek and is filed under How to invest in Poland. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.