Agreement on the suspension of the application of company labor law

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Although the Labor Code and other provisions of the labor law are based on the principle of privileging the employee, in special cases they allow for a temporary deterioration of his position under the employment relationship - when it is justified by the specific situation of the employer. The agreement to suspend the application of company labor law is an exceptional event. We explain more on this in the article!

The concept of labor law

Within the meaning of Art. 9 of the Labor Code are the provisions of the aforementioned Code and the provisions of other acts and executive acts, defining the rights and obligations of employees and employers, as well as provisions of collective labor agreements and other collective agreements based on the act, regulations and statutes defining the rights and obligations of the parties to the employment relationship.

At the same time, the Labor Code establishes the hierarchy of labor law acts, stating that:

  • the provisions of collective labor agreements and collective agreements as well as regulations and statutes may not be less favorable for employees than the provisions of the Labor Code and other laws and executive acts;
  • the provisions of the regulations and statutes may not be less favorable to employees than the provisions of collective labor agreements and collective agreements.

Example 1.

In the agreement on collective redundancies concluded between the employer and the company trade union, setting out the rules of conduct in matters relating to employees covered by the intention of collective redundancy, it was established that the severance pay for the redundant employees will be paid by the employer in the amounts 50% higher than the amounts provided for in Art. 8 sec. 1 of the Act of March 13, 2003 on special rules for terminating employment relationships with employees for reasons not related to employees. Such an agreement meets the requirements of the Labor Code - not only is it not less favorable than the aforementioned provision of the Act, but also grants employees the right to cash benefits in amounts higher than those specified in the Act. In these circumstances, the provision of the agreement in question takes precedence as more favorable to the employee over the provision of the act.

The provisions of collective labor agreements and other collective agreements based on the act, regulations and statutes defining the rights and obligations of the parties to the employment relationship, violating the principle of equal treatment in employment, shall not apply.

In art. 9 of the Labor Code, the principle of privileging an employee as one of the parties to the employment relationship was established, consisting in the fact that if one of the sources of labor law is regulated by the employer-employee relationship more favorably to the employee than beneficial).

Agreement on the suspension of the application of company law

The Labor Code, by regulating the mutual obligations of the parties to the employment relationship, is aimed at protecting the interests of the employee as the economically weaker party to this relationship. However, this act also contains provisions to protect the vital interests of the employer. Such regulations include Art. 91 of the Labor Code

Pursuant to this provision, if it is justified by the employer's financial situation, an agreement may be concluded between the employer and the employee representation to suspend the application of company law in whole or in part, the provisions of the labor law defining the rights and obligations of the parties to the employment relationship, and the application of provisions of the Labor Code, other acts and executive acts (ordinances). Apart from the provisions of the Labor Code, other acts and executive acts, pursuant to art. 9.1 of the Labor Code, the application of the provisions of collective labor agreements cannot be suspended, as they are suspended on the basis of a separate regulation contained in Art. 241.17 of the Labor Code.

The assessment whether a given financial situation of the employer justifies the suspension of the application of the corporate labor law provisions is left entirely to the parties to the agreement and is not subject to court control (judgment of the Supreme Court - Chamber of Labor, Social Insurance and Public Affairs of 6 December 2005, III PK 91/05) ). Therefore, it was considered that a sufficient mechanism to prevent abuse of the option provided for in Art. 91 of the Labor Code, there is an institution of an agreement - the application of labor law provisions will not be suspended if both parties to this agreement do not agree to it.

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Parties to the agreement

The agreement is concluded by the employer and the trade union organization representing the employees, and if the employer is not covered by the operation of such an organization, the agreement is concluded by the employer and the employee representation selected in the manner adopted by that employer. If there are many trade unions at the employer, in order to reach an agreement, they should present the employer with their common (agreed) position.

Content of the agreement

In the agreement concluded between the employer and employee representation, the following should be indicated at least:

  • a legal act that is subject to suspension;
  • the suspended provisions of this act;
  • the period for which the application of the rules is suspended;
  • the date of entry into force of the agreement

The provisions of the agreement can also be formulated in such a way that they will modify, for the duration of the suspension, certain rights resulting from a given labor law act (e.g. remuneration regulations).

Example 2.

The remuneration regulations stipulate that employees are entitled to a fixed bonus of 30% of the basic salary and an annual bonus from profit. The employer concluded an agreement with the trade union organization to suspend the application of the provisions of the regulations for a period of 2 years. Pursuant to this agreement, the paragraph determining the amount of the bonus was modified, reducing it from 30% to 15% of the basic salary, and the application of the paragraph establishing the employee's entitlement to profit bonuses was suspended.

Decision of the Supreme Court - Chamber of Labor, Social Security and Public Affairs of 27 March 2018 (I PK 166/17)

From the linguistic wording of Art. 91 § 1 of the Labor Code, it does not follow that the subject of the agreement was limited only to the absolute consent of the trade union organization to suspend the application of the remuneration regulations. The suspension of the application of the regulations may be combined with the granting of specific benefits (compensations) to employees, which will be an integral part of the agreement on the suspension of the application of all or part of the provisions of the labor law.

The suspension of the application of the provisions of the labor law may not exceed a period of 3 years. However, the regulations do not limit the number of concluded agreements. Therefore, if the parties so wish, they may, after the expiry of the validity of a given agreement, conclude another agreement for a period not exceeding 3 years.

The employer is obliged to submit the agreement to the competent district labor inspector. This message is for information purposes only. The District Labor Inspector does not have to take any action, in particular accept or approve the content of the agreement.

Effect of the conclusion of a suspension agreement for employees

The conclusion of the agreement results in a periodic change in the content of the employees' employment relationships. In this case, it is not necessary to obtain the consent of individual employees.

If the employer intends to worsen the working conditions or wages of employees without concluding the said agreement, he could do so under the parties' agreements concluded with each employee separately or by making the so-called amending notices pursuant to art. 42 of the Labor Code (in the event of a refusal by an employee to accept the working conditions or remuneration proposed in a notice changing - the employment contract is terminated upon the expiry of the notice period).

An agreement temporarily suspending the application of labor law provisions, although it always constitutes a certain inconvenience for employees, may often serve to improve the economic situation of the employer, and thus prevent further adverse effects, e.g. collective redundancies.