Ministry working on minimum hourly wage

Ministry of Family, Labour and Social Policy is working on amendments to labour law that are to introduce minimum hourly wage.

The government wants to discourage employers from using civil law contracts.

The idea is gaining mixed reviews and sparked off heated debates among journalist, finance experts, or even government officials.

The initiative will bring something new to the labour market. Currently in Poland there is no such thing as minimum hourly remuneration.

However, the country has minimum salary that applies to all people working on the basis of contracts of employment. Its current level is 1850 PLN gross.

It does not apply to employees engaged on the basis of civil law contracts: contracts to perform a specific task and order contracts. Due to this, some entrepreneurs prefer to use civil law contracts instead of contracts of employment when hiring staff.

The Ministry plans to introduce a minimum hourly wage in the amount of 12 PLN per hour (gross) for all employees hired on the basis of order contracts. In a 40-hour workweek, this amounts to 1920 PLN per month.

As minimum salary for contracts of employment is 1850 PLN gross, employers will be more likely to use this type of contracts.

Entrepreneurs, understandably, criticize the Ministry for increasing the costs of employing personnel. They warn that many businesses may be forced to cut their staff levels or even wind down their operations completely.

The Ministry is still working on the new regulation, but Minister Elżbieta Rafalska revealed the government wants it to come into force in September 2016. This is later than expected. Initially, the Ministry wanted to have the regulation ready in July.

Another planned change also concerns order contracts. Workers will soon be under obligation to record their working hours. Failure to comply will result in penalties from 1 000 to 30 000 PLN.

This proposal has been met with a lot of criticism. Employers suggest that some jobs should be exempted from the obligation, as it will be very difficult to determine and record the time workers spend on the job.

The government hopes the new developments will bring the number of people with order contracts down and increase the number of those with contracts of employment.

According to a survey carried out by CBOS (Public Opinion Research Centre) in 2014, over 70% of Poles would like the government to introduce minimum hourly wage.