Types of employment contracts set out in the Polish Labour Code
Polish Labour Code differentiates between three types of employment contracts. These are:
- Probationary employment contract
- Fixed-term employment contract and
- Indefinite term employment contract
Probationary employment contract shall be entered into in order to check the qualifications of the employee. Maximal term of such a contract is 3 months. Its distinguishing feature is, as a general rule, lack of possibility of renewing a probationary employment contract with the same employee, if such an employee would perform the same type of work. However, after 3 years from the expiry or termination of such a contract, it is possible to renew the probationary employment contract once, even if the employee performed the same type of work as during the term of the original contract.
Fixed-term employment contract is an agreement under which the employee performs work for the employer within a specified period of time – i.e. e.g. from 1st April 2022 until 1st August 2022. Term of such a contract is strictly outlined. The contract expires on the date set out therein or can be a terminated by a notice, without a notice or by an agreement of the parties.
Indefinite term employment contract is executed, as the name suggests, for a period of time that is not specified. The contract determines the date of the commencement of the provision of work, but it does not specify the date of its expiry. Indefinite term employment contract can be terminated by a notice, without a notice or by an agreement of the parties.
Fixed-term employment contract – limitations
A fixed-term employment contract appears to be extremely beneficial for the employer – and somewhat less so for the employee. The employee must always take into account a possibility that another contract (whether temporary or permanent) may not be executed with him. The employer, on the other hand, has another tool to end the legal relationship between the parties. When an employee fails to effectively perform in a particular work environment, the employer can simply wait until the expiry of the contract and the employment relationship will automatically end. If such a contract expires – the employer does not need to give notice – which, as we know, needs to be justified.
What is worth highlighting – in order to protect the employee as the weaker party to the employment relationship, fixed-term employment contracts have been subjected to certain limitations in the Polish Labour Code.
Firstly – the temporal limit. The maximum term of employment under a fixed-term employment contract is 33 months in total. The first day after the expiry of this term is considered the first day of applicability of an indefinite-term employment contract.
Secondly, the quantitative limit. A maximum of three fixed-term employment contracts are allowed. Any subsequent contract will be considered a contract concluded for an indefinite time.
Both restrictions apply cumulatively, which means that the same employer may conclude a maximum of 3 fixed-term employment contracts with the same employee for a total maximum period of 33 months.
Another issue is that amendments to the contract, insofar as they contain provisions to extend the term of the contract, are treated as a conclusion of another fixed-term employment contract – which is not excluded from the aforementioned quantitative or temporal limit.
However, the aforementioned temporal and quantitative limits shall not apply if the fixed-term employment contract is concluded:
- in order to replace another employee during their excused absence from work
- to perform work of a casual or seasonal nature
- to perform work for a term of a mandate
- in the event that the employer identifies objective reasons on his side that justify the use of this type of employment contract
- in the case of an extension of the employment contract until the date of confinement.
It is important to note that a probationary employment contract does not count towards the limit of “temporary” employment contracts. An employer may enter into a probationary employment contract with a given employee (i.e. for a maximum of 3 months) and then enter into a maximum of 3 fixed-term employment contracts (the duration of which may be a maximum of 33 months in total) – i.e., de facto, 4 contracts for a maximum of 36 months.