Protection of employees' claims - changes from August 21, 2017

Service

On August 21, 2017, the amendment to the Act on the Protection of Employee Claims in the Event of Employer Insolvency and the Act on Court Costs in Civil Cases was published in the Journal of Laws. Now the protection of workers' claims is greater. The new provisions came into force 14 days after their publication in the Journal of Laws.

Protection of employees' claims - changes

The changes introduced to the act are aimed in particular at:

  • extending the protection of workers' claims and the benefits due to unemployed persons in connection with the insolvency of the employer;

  • faster granting of financial assistance in connection with the cessation of activity by the employer.

Attention!

From August 21, 2017, greater protection of employees' claims applies.

Extension of the definition of an employee

In art. 10 of the Act presents an extended definition of an employee. The protection of employees' claims in connection with the amendment to the act will also apply to people employed by the employer who have so far been excluded from protection because they could have had an impact on the employer's activities. These people are, among others the employer's spouse, own children and children of the other spouse, adopted children, parents, stepmother, stepfather. This provision is adjusted to the law in force in the European Union.

Extension of reference periods

The act extended the reference periods between the termination of the employment relationship and the date of the employer's insolvency. Now this period is 12 months (3 months more than before). Thanks to this change, the protection of employees' claims will also apply to persons whose entitlement to benefits did not fit in the previous reference periods.

Attention!

The reference period is the time between termination of employment and the date of the employer's insolvency. Currently, this period is 12 months.

Extending the catalog of employee benefits in connection with the insolvency of the employer

In the amendment to the Act on the Protection of Employee Claims in the Event of Employer Insolvency, the catalog of employee benefits in the event of the employer's insolvency has been extended. Until now, it was possible to pay an equivalent for unused annual leave due only for the year in which the employment relationship ended. The act introduces a change, the equivalent for unused holiday leave will also be paid for the previous year. In addition, the payment of benefits in the form of an equivalent for unused vacation leave will also be possible when the employment relationship was terminated no later than 4 months after the date of the employer's insolvency.

Attention!

From August 21, 2017, as part of the paid employee benefits, an equivalent will be paid for unused holiday leave also for the previous year compared to the year in which the employment relationship ended.

Advance payment towards benefits not met by the employer

Due to the introduction of a new definition "actual cessation of activities", specifying the date of the actual cessation of business activity and specifying the provisions regulating the institution of the advance payment for benefits not satisfied by the employer who actually ceased economic activity, the application of this institution has become possible. In addition, the advance payment procedure has been simplified and informalised. Statements were introduced instead of documents confirming the employee's entitlements. The advance payment will be made in the amount of the employees' unsettled claims by the employer. However, this amount may not be higher than the minimum remuneration for work, applicable on the day of submitting the application for the advance payment.

Attention!

The amount of the advance on the benefits not met by the employer may not be higher than the amount of the minimum remuneration for work.

Payment of benefits by voivodeship labor offices

There have also been changes in the payment of benefits by voivodeship labor offices, namely:

  • the basis for the payment of employee benefits is the amount of the average monthly remuneration in force on the date of submission of the list or application for the payment of the benefit;

  • benefits are of a one-off nature (for the same employees of a given employer), and outstanding periodic benefits, including remuneration, will be paid for a period not longer than 3 months;

  • if the voivodship marshal refuses to pay the benefits or the advance payment, the applicant will have 30 days to appeal to the labor court, counting from the date of service.

Exemption from the ratio fee

As part of the changes, an exemption from the proportional fee in matters of labor law was also introduced in the case of seeking reimbursement of receivables resulting from the implementation of provisions on the protection of employees' claims in the event of the insolvency of the employer. This provision applies to amounts in excess of PLN 50,000.00. Therefore, in the event of employers' insolvency, employee benefits will be paid from the funds of the BGŚP.

Attention!

The relative fee is collected in cases concerning property rights and amounts to 5% of the value of the subject of dispute or subject of appeal.

The amendment to the act also clarifies some provisions regarding the protection of employees' claims.

Polish law aims to adjust the provisions to the law in force in the European Union. This time, the changes concern greater protection of employees' claims. Thanks to these changes, in the event of the insolvency of employers, employees can count on the benefits to which they will not be forfeited.