Current legal framework

Under the current legal regime, PIP is not authorised to unilaterally reclassify a civil law contract as an employment contract. Any change in the legal classification of a contract requires PIP to initiate proceedings before the labour court.

What do the planned changes provide for?

The planned amendments include, in particular:

• enabling PIP authorities to determine the existence of an employment relationship by an administrative decision,
• increasing fines for breaches of labour law provisions,
• equipping PIP with additional powers to exchange data with the National Revenue Administration (KAS) and the Social Insurance Institution (ZUS),
• introducing the possibility of remote inspections and electronic documentation of inspection activities.

The planned changes are revolutionary. Under the current practice, the reclassification of civil law contracts and B2B cooperation agreements occurs only occasionally (according to publicly available data, PIP has filed fewer than 100 lawsuits annually in recent years). The announced amendments aim to transform PIP’s activities into systemic controls based on continuous and automated data and risk analysis.

The far-reaching nature of the proposed changes is also evident in the fact that, to date, a key element has been the worker’s actual willingness to pursue a claim before the court. Under the new legal framework, PIP will act unilaterally and authoritatively, without needing to consider the position of either the worker or the employer. In this respect, it can be assumed that one of the primary drivers of the reform is the public interest (including fiscal considerations), rather than the protection of individual workers.

The reclassification of forms of engagement (particularly B2B contracts) as employment contracts may have far-reaching tax consequences – especially regarding PIT and VAT - and significant implications for social security and health insurance contributions.

In light of the above, we recommend a thorough review of the forms of engagement currently used within your organisation, the contractual terms, and the actual scope of responsibilities and tasks performed by engaged individuals. In this regard, we remain at your disposal to provide appropriate advisory support.

At present, the draft act has not yet been published; however, the assumptions for the changes have been included in the Council of Ministers’ legislative agenda. We are closely monitoring the legislative process, as the draft legislation may be published at any time, given the announced entry into force of the act in 2026.