Employment & labor law /

Attention: new changes in the labor market!

The government has initiated the drafting of a new law on the labor market and employment services. This new legislation will replace the existing Law on Employment Promotion and Labor Market Institutions.

The changes are expected to result in significant modifications to the labor market. Among other things, the goal is to encourage retirees and seniors over 60 to become more active in the labor market.

The new law on the labor market and employment services is expected to align regulations with Poland's rapidly growing labor market. The Council of Ministers plans to adopt the draft as early as the third quarter of 2024.

Regulations must be updated to reflect the dynamic nature of the labor market.

The current law on employment promotion and labor market institutions, which has been in effect for many years, is considered outdated. This has led to the development of a new law to replace it.

The new Labor Market and Employment Services Act is designed to align regulations with Poland’s rapidly evolving labor market. The Council of Ministers plans to adopt the draft as early as the third quarter of 2024. We can anticipate changes in the coming years.

What changes will the new law bring about?

The government has stated that the law aligns with the assumptions of the National Plan for Reconstruction and Increasing Resilience, developed for Poland by EU bodies. Its objective is to strengthen Poland’s economy. The new regulations are designed to enhance Poland’s labor market and the transformation of public employment services. 

The draft legislation introduces a number of changes in various areas, including:

  • increasing the efficiency of labor offices,
  • making it easier and more efficient to find a job,
  • extending assistance to the economically inactive,
  • support for those returning to the labor market,
  • support for the employment of seniors.

According to the new guidelines, entrepreneurs will be able to receive subsidies for hiring jobseekers who are above retirement age.

Time for subsidies for hiring retirees?

One of the proposed regulations in the bill is the introduction of assistance for entrepreneurs who hire seniors. While this is not a completely new idea from the government, the current Employment Promotion Act already allows for subsidies for hiring an unemployed person over 50.

However, the changes are intended to expand the subsidies and clarify the rules for obtaining them. The new assumptions allow entrepreneurs to receive a subsidy for employing jobseekers who are over retirement age. The subsidy is available for men over 65 and women over 60.

The announcement states that the status of the retiree will not be taken into account. The only criterion for receiving the subsidy is to be the age of the jobseeker who will be employed by the given entrepreneur.

How high will the subsidy be?

The subsidy will be paid monthly at a maximum of 50% of the minimum wage. At the current minimum wage of PLN 4,300 (effective as of July 1, 2024), the maximum monthly subsidy for the employer will be PLN 2,150. 

In the case of hiring a retiree, the employer will receive this kind of subsidy for 24 months, which totals more than PLN 50,000. The condition for taking advantage of the subsidy is to continue to employ the retiree for another 12 months. Thus, in order to receive the subsidy, the retiree will have to work at your company for at least three years.

The subsidy will be paid monthly at a maximum of 50% of the minimum wage.

Do the new regulations = an opportunity for seniors?

Research in Poland indicates that seniors are relatively inactive compared to other European Union countries. For instance, a study by the Central Statistical Office found that in 2021, the share of working people aged 60 and over with established pension rights in the total number of working people was only 3.6%. 

Poles over the age of 60 are much less economically active, and those who would like to take up employment rate their chances of employment poorly. The new subsidy is intended not only to encourage employers to hire seniors, but also to make it easier for those who want to be professionally active despite reaching retirement age.

There are voices in the market criticizing the introduction of the subsidy for people of retirement age. Critics believe that it would make more sense to activate people over 50. These individuals are generally more willing to work, but their chances of employment are low due to age and competition in the labor market. At present, however, the government has no plans to make such changes to the project. We must await the outcome of the next months of work on the draft.

For more detailed information on the upcoming labor law changes, or if you have questions about employment, please contact the lawyers in our firm’s labor law department at [email protected].

Author team leader DKP Legal Joanna Kowal
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Write an inquiry: [email protected]
check full info of team member: Joanna Kowal
Author team leader DKP Legal Alicja Myśluk-Landowska
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Write an inquiry: [email protected]
check full info of team member: Alicja Myśluk-Landowska

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