Table of contents

  1. Termination by an employee of a definite-term agreement (judgment of the Supreme Court dated 14 February 2012, file no. III PZP 5/11)
  2. Information on employees protected by a trade union (judgment of the Supreme Court dated 24 January 2012, file no. III PZP 7/11)
  3. Protection against termination in a pre-retirement period (judgment of the Supreme Court dated 18 January 2012, file no. II PK 149/11)
  4. Specification of the workplace in the employment agreement (judgment of the Supreme Court dated 9 December 2011, file no. II PZP 3/11)
  5. Settlement of overtime hours – standard remuneration and remuneration based on pay scale (judgment of the Supreme Court dated 22 June 2011, file no. II PK 3/11)
  6. Change of disability pension insurance premium (amendment to the Act of 13 October 1998 on social insurance system)

1. Termination by an employee of a definite-term agreement (judgment of the Supreme Court dated 14 February 2012, file no. III PZP 5/11)

In its resolution dated 14 February 2012, issued in the case with file no. III PZP 5/11, the Polish Supreme Court determined the legal effects triggered by an employee's terminating a definite-term employment agreement concluded for more than six months, when the agreement does not stipulate a possibility of early termination.

The resolution concerns an employment agreement concluded for two years and terminated by an employee, although the agreement did not contain an option to terminate. The court ruled that the employee's statement of termination with a twoweek notice period resulted in termination of the agreement under the relevant provisions on employment agreement termination without notice.

This means that, if an employee terminates the agreement in breach of the provisions on agreement termination – especially if no circumstances provided in the Labour Code justify termination of the employment, e.g., an employee shows a medical certificate confirming a negative influence of the work on his/her health – the employer may seek compensation from the employee for unjustified termination of the employment agreement equal to two weeks of the employee's remuneration.

2. Information on employees protected by a trade union (judgment of the Supreme Court dated 24 January 2012, file no. III PZP 7/11)

In the resolution issued on 24 January 2012 in the case with file no. III PZP 7/11, the Supreme Court pronounced on the matter of obtaining information from a trade union on employees protected by the union.

Under Art. 30 paragraph 21 of the Act dated 23 May 1991 on trade unions, in cases when an employer must cooperate with a trade union (e.g., to inform a union about planned termination), the employer must apply to the relevant trade union for information on protected employees. A trade union's failure to provide such information within five days will release the employer from the duty to cooperate with the trade union on that matter (e.g., from the obligation to inform the trade union about a planned termination). Employers often request from trade unions lists of all protected employees. They must then notify the trade union of planned dismissals of employees from the list (or those who have informed the employer themselves that they are protected by the union).

But in the resolution in question, the Supreme Court stated that a trade union may not provide such information due to protection of personal data of protectioncovered employees. According to the court, even if an employer does not have such information, it must still notify the trade union of its intention to terminate the employment agreement.

The complete resolution is not yet available. But the interpretation of provisions resulting from the resolution's core ruling is rigorous and may make it more difficult for employers to terminate employment agreements.

3. Protection against termination in a pre-retirement period (judgment of the Supreme Court dated 18 January 2012, file no. II PK 149/11)

In its judgment dated 18 January 2012 (file no. II PK 149/11), the Supreme Court resolved the issue of protection against termination in the so-called pre-retirement period. The case related to a female employee employed as administrative staff in a hospital whose post was eliminated as a result of restructuring and whose employment agreement was terminated. Within this period, the employee had reached the age of 56 and had a record of more than 30 years of paying insurance premiums, which entitled her to a pension.

The employee appealed against termination to the labour court. She claimed, among others, that she was covered by protection against termination under Art. 39 of the Labour Code. That provision prohibits terminating employment agreements with persons who have no more than four years left to retirement if their total period of employment entitles them to receive a pension. The employer claimed that pre-retirement protection did not exist as, in 1995, the employee was assigned to the 2nd disability group and the relevant work disability certificate was kept in her personal files, meaning that under Art. 40 of the Labour Code, protection did not apply. Her personal files did contain certificates of permanent work disability, but there was no decision from the Social Insurance Authority granting a disability pension to an employee for that reason.

The Supreme Court held that even a certificate of permanent work disability allows for changing a disability degree (e.g., during a medical examination) and that the employee's health could have improved after the certificate's issue date. The court held that pre-retirement protection may be excluded only when an employee received a decision from the Social Insurance Authority confirming the grant of a disability pension. The work disability certificate itself does not exclude such protection.

4. Specification of the workplace in the employment agreement (judgment of the Supreme Court dated 9 December 2011, file no. II PZP 3/11)

In its resolution issued on 9 December 2011 (file no. II PZP 3/11), the Supreme Court referred to the specification of the workplace in the employment agreement. Under Art. 29 § 1 point 2 of the Labour Code, an employment agreement determines the workplace. This may be, for example, a production plant or a company's seat. The place of work may also be specified as a certain geographical area, such as Mazovia province.

The case concerned an employee of a building company investing in different places. In the employment agreement the parties agreed that the employee would be able to perform work in Poland (except for a few provinces) and other EU states. For six months the employee worked in Belgium. During this period the employer provided him with transport and accommodation. Upon finishing the work, the employee sought compensation from his former employer for travelling allowance.

On appeal, the Supreme Court held that an employee cannot be permanently on a business trip, and confirmed that a workplace might be specified in the employment agreement as a place where the employer carries out building work or other permanent work. According to the resolution, at any given time a permanent workplace is a place from among those set in the employment agreement in which the employee performs work systematically and for a long period.

The Supreme Court also confirmed the possibility of a flexible determination of a workplace in employment agreements and pronounced against recognising work performed in the above conditions as a business trip entitling one to travelling allowance.

5. Settlement of overtime hours – standard remuneration and remuneration based on pay scale (judgment of the Supreme Court dated 22 June 2011, file no. II PK 3/11)

The Supreme Court explained in its judgment dated 22 June 2011, case file no. II PK 3/11, the concept of "standard remuneration" and "remuneration based on pay scale determined by an hourly or monthly rate", used in provisions on how to determine remuneration for overtime work (Art. 1511 §§ 1 and 3 of the Labour Code).

The employee was employed as translator at the Polish Military Contingent in Iraq. As there were not enough staff, he had to work 386 overtime hours, and then claimed back those hours (i.e. the employer gave him days off work). Essentially, the dispute was to determine what components of the employee's remuneration should be considered when paying remuneration for overtime work and remuneration for time off given for overtime hours.

The Supreme Court stated that standard remuneration is received continuously and systematically under ordinary conditions and on ordinary payment dates. It encompasses both base remuneration based on pay scale and additional fixed remuneration components (if an employee is entitled to such additional components on the basis of internal salary regulations). This may include fixed allowances, such as a functional allowance, seniority allowance or hazardous work allowance.

An employee's remuneration based on pay scale and determined by hourly or monthly rate refers to the base remuneration rate specified in the employment agreement and is connected with the type of work performed (i.e., work at a given post or of a given type). Additional remuneration components do not result from the employee's hourly or monthly rate based on pay scale – they are not a direct payment for a given type of work or work at a given post and for required qualifications. But such components may be awarded to an employee upon meeting additional requirements, such as additional work outcomes, increased responsibility, seniority, special qualifications, experience or practice in a given area.

Provisions on working time, and in particular those regarding settlement of overtime hours, often raise doubts in practice. That is why the judgment in question, thanks to statutory expressions being defined, should ease the work of HR departments.

6. Change of disability pension insurance premium.

As of 1 February 2012, as a result of an amendment to the Act of 13 October 1998 on social insurance system, part of the disability pension insurance premium paid by employers was raised from 4.5% to 6.5% of the assessment base (i.e., employee's revenue). Simultaneously, the entire amount of the disability pension premium was changed and now is equal to 8% of the assessment base.

Unfortunately, this means an increase in the cost-per-hire. It may also contribute to a further increase in the number of non-employment forms, such as self employment.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.