FPP: Two introduced changes to the Labor Code will cost employers about PLN 11 billion/year

by   CIJ News iDesk III
2023-02-07   11:52

The total burden on employers from the introduction of the two current amendments to the Labor Code will amount to about PLN 11 billion annually, according to estimates by the Federation of Polish Entrepreneurs (FPP). FPP renews its call for a longer vacatio legis for the changes to the Code.

One of the proposals is to exempt an employee from work due to force majeure in urgent family matters caused by illness or accident, if the employee's immediate presence is necessary, to the extent of 2 days or 16 hours per calendar year. During the period of this leave of absence, the employee retains the right to be paid half salary. The second change that will contribute to costs is the proposal to introduce additional breaks of at least 15 minutes if an employee's daily working hours are longer than 9 hours and when longer than 16 hours.

"An issue of concern is the definition of force majeure and the situational context justifying the employee's exemption from work. In specific cases, there can be a serious conflict of interest when the employer needs the employee on the job and is to decide whether there is actually a necessity for such an exemption. For the employer, such a regulation means additional costs. The drafters' impact assessment (RIA) does not include a calculation of these effects - which demonstrates the difficulty of calculating them. However, it should be recognized that on an economy-wide scale they will be significant. The increase in labor costs will be translated into product costs. It is therefore an inflation-increasing measure. The regulatory changes will affect competitiveness and the labor market," FPP labor market expert Grażyna Spytek-Bandurska said.

"It should also be noted that the proposed Article 134 refers to daily working hours, and not the actual work performed. In addition, other burdens on employers are not taken into account, such as parking for weather-dependent work, which particularly affects the construction industry or certain types of manufacturing. As a result, the increase in costs will be even greater," she added.

The proposed amendments to the Labor Code (parliamentary print No. 2932) are aimed at implementing two directives: 2019/1152 of June 20, 2019 on transparent and predictable working conditions in the European Union and 2019/1158 of June 20, 2019 on work-life balance for parents and caregivers. Most of these changes will contribute to organizational problems due to the greater likelihood of employee absenteeism. There may also be disputes over the correct understanding of some provisions, as well as additional costs, the Federation estimates.

Taking into account the average monthly salary in the enterprise sector in 2022. - PLN 6654 and the average number of working days per month in 2023 (vacation factor for 2023) - 20.8 days, the cost of one working day for 1 employee per year is PLN 383. This further assumes that an employee will benefit from two days, and we have 16 million working people in the economy, the overall cost will be 6 billion 128 million, it was announced.

Taking into account the average monthly salary in the enterprise sector in 2022. - PLN 6654 and 10% of the total working population out of 16 million, then the cost of an additional one break (over 9 hours) is a total of 4.8 billion, as calculated: the cost at one additional 15-minute break of one person is PLN 2,994 x 1.6 million people = 4.8 billion, according to the announcement.

FPP points out that the Parliamentary Committee on Social Policy and Family did not address the extension of the entry into force of the regulations amending the Labor Code - despite the employers' appeal. As highlighted, MPs failed to take any interest in the fact that further changes to the labor law are again placing a financial burden on employers and making it difficult to adjust to the new state in just 21 days after the law was promulgated. They also overlooked the fact that regulations on remote work and employee sobriety checks are about to come into force, which require a lot of internal regulation-making and work organization.

Source: FPP and ISBnews