A Western European technology company had employed a senior manager in Poland for several years under a local employment contract. When the business decided to restructure its regional operations, the termination procedure did not follow Polish employment legislation correctly. The former employee filed a claim before the Polish labour court within weeks of receiving the dismissal notice. What appeared to be a straightforward exit became a multi-stage dispute with significant financial and reputational exposure.
Resolving an employment dispute in Poland requires navigating labour court proceedings governed by Polish employment legislation, with strict deadlines from the date of the dismissal notice. The claimant must file within 21 days of receiving written termination. Proceedings typically conclude within six to eighteen months, depending on court workload and case complexity.
This case study outlines the strategy adopted, the key milestones encountered, the complications that arose, and three transferable lessons applicable to any cross-border employer operating in Poland.
Client profile and the legal challenge
The client was a mid-sized technology company headquartered in Western Europe. It employed the individual under a Polish-law employment contract, with remuneration structured partly through a base salary and partly through a performance-related element. A collective agreement applicable to the sector also governed certain entitlements – including notice period length and severance calculation.
The termination was initiated without consulting the applicable collective agreement provisions. The dismissal notice was issued on financial grounds, but the written justification was insufficiently specific under Polish employment legislation. Under Polish labour law, the reason stated in the notice must be concrete and verifiable. A vague reference to "organisational changes" did not meet that threshold.
The former employee's claim sought reinstatement and payment of remuneration for the period of unlawful dismissal. Alternatively, the claim included a request for compensatory damages. The exposure was material – covering multiple months of salary, social security arrears, and potential procedural costs.
For cross-border matters of this type, our employment law services in Poland provide end-to-end support from pre-termination review through to court proceedings and settlement.
Legal strategy and key milestones
The immediate priority was to assess the procedural timeline. The claim had been filed within the 21-day window. This meant the labour court would accept jurisdiction. Challenging admissibility was not a viable route.
The strategy focused on two parallel tracks. First, the team examined whether a negotiated settlement could limit total exposure. Second, a substantive defence was prepared in case settlement discussions did not progress. This dual-track approach is standard in Polish labour proceedings. Courts actively encourage early settlement, and the employer's willingness to engage constructively is noted in the judicial record.
The first hearing took place approximately eight weeks after claim filing. The court identified the core issue quickly: the dismissal notice lacked sufficient specificity under Polish employment legislation. The judge indicated that the employer's position on this point was weak.
Settlement negotiations opened at the second hearing, roughly four months into the process. The employer's exposure was recalculated to include social security contributions on any compensatory payment, which added a meaningful sum to the baseline figure. Polish employment legislation requires that compensation payments in certain categories of dismissal attract social security treatment.
A settlement was reached before the third hearing, approximately six months after the claim was filed. The agreed sum fell within a range the employer could absorb. Crucially, the settlement avoided a finding of unlawful dismissal on the court record – which would have had implications for future Polish operations and workforce relations.
The corporate dimension of this matter intersected with broader Polish regulatory obligations. Employers restructuring Polish entities should also consider the implications under corporate law in Poland, particularly where workforce changes accompany structural reorganisation.
Complications encountered
Three complications arose that were not anticipated at the outset.
First, the collective agreement had not been formally reviewed when the employment contract was drafted. The employer was unaware that the collective agreement imposed a longer notice period than the statutory minimum. This extended the period for which compensation was potentially owed.
Second, the social security position was more complex than initially assessed. The employer had classified part of the remuneration in a way that reduced the social security base. The former employee's legal team challenged this classification. Resolving the correct social security base required engagement with the relevant regulatory authority, which added time and cost.
Third, the employer's internal documentation was incomplete. Several written communications about performance targets had not been retained. This weakened the factual basis for the "organisational" justification in the dismissal notice. In Polish labour proceedings, documentary evidence is central. The absence of contemporaneous records significantly limits the employer's ability to substantiate a disputed termination.
For those managing similar disputes in other jurisdictions, our case study on employment disputes in Portugal illustrates how comparable documentation failures affect outcomes in civil law systems more broadly.
To discuss how Polish employment legislation applies to your specific situation, contact us at info@ferrazwhitmore.com.
Transferable lessons for cross-border employers
Lesson one: The dismissal notice is a legal instrument, not an administrative formality. Under Polish employment legislation, the written termination must state a reason that is specific, concrete, and capable of being substantiated in court. A generic reference to restructuring or financial pressure is insufficient. The employer must be prepared to produce documentary evidence supporting every element of the stated reason. Any gap between the stated reason and the available evidence creates immediate vulnerability.
Lesson two: Collective agreements modify statutory entitlements – and must be reviewed before any termination. Many international employers operating in Poland are unaware that a sector-level or company-level collective agreement applies to their workforce. These agreements routinely extend notice periods, increase severance entitlements, and restrict the grounds on which dismissal is permissible. Failing to identify and apply the relevant collective agreement before issuing a dismissal notice is one of the most common and costly errors in Polish employment disputes.
Lesson three: Social security exposure must be calculated before settlement, not after. Compensation payments arising from unlawful or disputed dismissal in Poland attract social security obligations in certain circumstances. The total cost of settlement is not simply the agreed compensation figure. Employers who negotiate a headline sum without accounting for social security may face a materially higher total liability once contributions are assessed. Any settlement strategy must include a precise social security calculation from the outset.
About Ferraz & Whitmore
Ferraz & Whitmore is an international law firm based in Lisbon, advising business clients across 46 jurisdictions. Our employment law practice supports international employers managing workforce disputes, termination procedures, collective agreement compliance, and cross-border labour matters across European markets, including Poland. Our team combines Portuguese civil law expertise with English common law tradition. an approach that is particularly valuable when an employer's home jurisdiction operates under different procedural assumptions than the country where the dispute arises. We have advised on employment contract structuring, dismissal risk assessment, and labour court proceedings across both civil law and common law systems. The firm's Lisbon base provides direct access to EU regulatory frameworks, while our cross-border experience supports employers navigating employment legislation in jurisdictions with distinct procedural requirements. For a preliminary review of your employment situation in Poland, email info@ferrazwhitmore.com.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Ferraz & Whitmore assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@ferrazwhitmore.com.