Warsaw, 10 October 2022
ZPP position on the bill on employment of foreigners (RCL work list no.: 400)
Regulations on the employment of foreigners have long been controversial. The regulations were not very clear and the procedures were complicated. This created numerous difficulties for foreigners wishing to take up employment in our country. However, Poland has made significant progress in this regard for some time.
The standards concerning the employment of foreigners can be found in numerous legal acts, most notably in the Act of 20 April 2004 on employment promotion and labour market institutions, the Act of 15 June 2012 concerning the effect of employing foreigners residing illegally on the territory of the Republic of Poland and the Act of 12 December 2013 on foreigners. In the context of the ongoing armed conflict in Ukraine resulting from the aggression of the Russian Federation, the Act of 12 March 2022 on assistance to citizens of Ukraine in connection with the armed conflict on the territory of that country, which provides for a number of facilitations for Ukrainians wishing to take up employment on the territory of Poland, is also very important.
Extremely important and expected changes in the employment of foreigners, which the Union of Entrepreneurs and Employers had long been calling for, were introduced by the Act of 17 December 2021 amending the Act on foreigners and certain other acts. The Act in question, among other things, extended the time for which an employer may entrust a foreigner with the performance of work on the basis of a mere declaration up to 24 months (Art. 88z sec. 2 item 3 of the Act on promotion of employment and on labour market institutions). The matter concerning temporary residence and work permits has also been simplified. The new provisions made it possible for a foreigner to perform work on the basis of an existing permit in a situation where, for example, a civil law contract was changed into an employment contract (Art. 119 of the Act on Foreigners). On the other hand, thanks to the new wording given to Art. 120 of the Act on Foreigners, a foreigner working in Poland in the situation of a change of the entity entrusting him/her with work does not need to apply for a new work permit as before, as he/she has the possibility to change the one already held.
However, in view of the needs of the labour market, where many employers are still having problems finding employees, as well as the relevance of the issue concerning the employment of foreigners in conditions where several million people have emigrated to Poland since the invasion of Ukraine by the Russian Federation, the Ministry of Family and Social Policy has prepared another important amendment to the legislation. This is because the Ministry has published on the website of the Governmental Legislation Centre and submitted for consultation a completely new bill “on employment of foreigners”. This means that this matter is to be taken out of the regulations of the Act on employment promotion and labour market institutions and regulated in a completely separate legal act. The explanatory memorandum of the bill also claims that it has been prepared in order to fulfil the obligations that our country undertook to fulfil within the framework of the National Reconstruction Plan. The issue of employment of foreigners was identified in the “milestone” A51G for the reform called “A4.1 Effective institutions for the labour market” providing for:
“Entry into force of new laws on public employment services, employment of third country nationals, and on an electronic conclusion of certain job contracts:
– introducing changes to public employment services and active labour market policies to increase labour force participation
– lowering the administrative barriers to employment of foreigners,
– simplifying the process of concluding certain contracts“.
The proposed legislation contains a number of positive changes in several areas. Certainly, a very important proposal is the electronicisation of procedures related to obtaining a work permit for foreigners. Article 8 stipulates that a work permit shall be granted upon application by the employer, which should be submitted by means of the ICT system at www.praca.gov.pl. An application submitted otherwise shall be left unprocessed. Also, appeals on the work permit shall be submitted in the ICT system. What is more, the obligations of employing entities to inform the authority of certain circumstances under Art. 18 sec. 2 (takeover of the workplace or part of it by another employer) and 19 (failure of the foreigner to start work, interruption of work and termination of work earlier than 3 months before the expiry of the work permit) must be done through the ICT system on the government website. What is important, Art. 59 stipulates that the procedure of submitting a declaration on the employment of a foreigner shall also be carried out through the indicated website. Also, the processing of personal data referred to in Chapter 7 shall be carried out in electronic form using the relevant ICT system. From the perspective of the foreigners themselves, it is very important that they will have constant insight into the ICT system. They will be able to check whether they have a work permit and for how long it has been issued and, e.g., whether they have been registered for social insurance. Another novelty is that the Ministry announces the possibility of verifying whether the remuneration offered to a foreigner is adequate to market conditions based on data taken from the Central Database of Job Offers. The above changes will certainly be important for streamlining the procedures and are a great improvement for employers wishing to employ foreigners.
The Ministry also declares to increase the role of the Public Employment Services in the process of legalising employment of foreigners. This issue refers primarily to entrusting work to foreigners on the basis of declarations. Importantly, the bill maintains the rule that a foreigner can be employed in this way for up to 24 months and a number of other requirements in this regard. These standards are set out in Art. 59 and 63 of the bill. It is also worth noting the change in terminology. The bill mentions a “declaration on the employment of a foreigner”, while the still in force Act uses the term “declaration on entrusting work to a foreigner”. Although the change is minor, and it is in fact the same institution, nevertheless the new name emphasises that it is the employment of a specific person.
Another important objective of the Act, which the Ministry emphasises in its justification, is the reduction of administrative barriers and the streamlining of procedures concerning the employment of foreigners. The most important change in this respect is the abandonment of the so-called “labour market test”, which imposes on the entity entrusting employment an obligation to present a declaration from a starost on the employer’s inability to meet its staffing needs in a given market (the current regulation of Art. 88c sec. 1 item 2). This is a change repeatedly advocated by employers, which will not only significantly facilitate the employment of foreigners, but will also increase access to qualified staff for Polish companies.
An important change is also the waiving of the obligation to carry out the problematic procedure for the renewal of a work permit that has already been issued in a situation where the employer wants to continue working with a specific person. In such a case, new permits shall be issued under more favourable conditions, e.g. the employee shall be able to continue working throughout the process and shall not face the risk of having to give up work for some time due to delays in issuing the work permit. In addition, such applications have priority for consideration. These standards are set out in Art. 21 and 27 of the bill.
The changes will also apply to situations that are negative grounds for granting a work permit. It will be obligatory to refuse to issue a permit if the employer is in arrears in the payment of social security, health insurance and other contributions indicated in the legislation (Art. 13 sec. 1 item 1 (i)). However, optionally, the authority shll be able to refuse to issue a work permit “if it appears from the circumstances that the foreigner shall not perform work in the territory of the Republic of Poland under the conditions specified in the work permit or that the employer shall not fulfil the obligations related to the employment of the foreigner or other persons or to the conduct of activities […]’. (Art. 14).
An important change concerning the work permit is also the indication that it will be possible to issue it when the working hours are not less than one quarter of the full working hours in a month (Art. 28 sec. 1 item 4). This is intended to prevent abuse in the issuing of permits for very low working hours.
Penalties for employing foreigners in contravention of the Act are also to be slightly amended. The new provisions provide for a fine of between PLN 500 and PLN 30,000 (Art. 76 sec. 1). Thus, the lower limit of the fine has been lowered, but at the same time a clear provision has been introduced that the fine “shall be imposed in an amount not lower than PLN 500 per foreigner” (Art. 76 sec. 1 item 9).
Despite numerous and positive proposals, the legislator (at this stage) did not decide to introduce other expected changes. This is because it was expected that many competences in the area of declarations of employment of foreigners and work permits would be transferred to employment agencies, while starosts and voivodes will still have the decisive voice in this area. There was also no decision to extend the period of “seasonal work”. Solutions that are disadvantageous from the perspective of some entrepreneurs have also been introduced. For example, the period for which a work permit is issued has been shortened when the employer has been active on the market for more than a year, when the working time will be low or when the foreigner will perform employment under a civil law contract (Art. 32). In the latter case, an additional fee shall also be charged.
The Union of Entrepreneurs and Employers points out that the proposal for a new law on the employment of foreigners presented by the Ministry of Family and Social Policy is a good solution. It is based on the significant and positive changes made in the employment of foreigners in recent months and adds a number of good new solutions to streamline and simplify procedures. It also places all the standards concerning the employment of foreigners in a single legal act, which will certainly increase the transparency of this matter. However, it should be pointed out that in several cases the legislator did not decide to introduce the solutions demanded by the market.