A mid-sized technology company based in Mazowieckie region faced a difficult restructuring in autumn 2025. It needed to terminate employment contracts for eleven employees simultaneously, several of whom held different seniority levels and one of whom had recently raised a concern about workplace safety. The payroll team's initial severance calculations were contested by two employees before the calculations were even paid out.

Under Polish labour law, severance pay on collective or individual redundancy is calculated by multiplying the employee's average monthly remuneration by a coefficient that rises with seniority: one month's pay for service under two years, two months for two to eight years, and three months for service exceeding eight years. The payment is capped at fifteen times the minimum wage in force on the date of termination. Errors in either the base salary figure or the seniority bracket trigger personal grievance claims and potential reinstatement orders from the Sąd Pracy (Labour Court).

This case study walks through the background, the legal strategy our team applied, the process before the Labour Court, and the transferable lessons for any employer planning workforce reductions in Poland. It also addresses the intersection of severance rules with whistleblower protection – a dimension that many restructuring teams overlook until it is too late.

What was the background of the redundancy dispute?

The client – an IT services provider – initiated a reduction-in-force affecting roles across two departments. Eleven employees received notices citing economic reasons. Under Polish employment legislation, individual redundancy notices citing the employer's reasons must state those reasons clearly; vague formulations allow employees to challenge the entire termination before the Labour Court within twenty-one days of receiving notice.

Two employees filed objections. The first disputed the seniority calculation: the employer had counted only the period with the current legal entity, ignoring an earlier period at a predecessor company that had been absorbed through a merger. Polish employment law treats continuity of employment as preserved through legal succession, so the full combined period counted. That error shifted the employee from the two-month to the three-month bracket.

The second employee had, three months before the redundancy, submitted a written concern to the compliance officer about alleged irregularities in client billing. Under the whistleblower Poland framework introduced by the Act on the Protection of Persons Reporting Violations of Law, dismissal of a reporting person within twelve months of the report triggers a rebuttable presumption that the termination was retaliatory. That presumption reverses the burden of proof: the employer must demonstrate that the redundancy was genuine and would have occurred regardless of the report.

The National Labour Inspectorate (Państwowa Inspekcja Pracy, PIP) was notified by the second employee. PIP opened a preliminary inquiry within fourteen days, which temporarily complicated the client's timeline for processing final settlements.

What legal strategy did the team apply?

Our team at KORDECKI & Partners identified three immediate priorities. First, correct the seniority calculation for the first employee before the Labour Court hearing. Second, document the genuine economic basis for the redundancy of the second employee with enough specificity to rebut the whistleblower presumption. Third, ensure that all eleven severance payments used a defensible base-salary figure.

On the base-salary question, Polish employment legislation defines average monthly remuneration by reference to the three months preceding termination. Variable components – bonuses, commissions, shift allowances – must be averaged across that period. The payroll team had excluded a quarterly project bonus on the assumption it was discretionary. Our review of the bonus scheme documentation showed it was contractually guaranteed on meeting defined targets. Its exclusion understated the base by roughly eighteen percent for three employees.

We also reviewed the employment contracts against the dividend distribution rules for Polish companies context to confirm that two senior employees held hybrid contractor-director arrangements. For those individuals, the severance calculation required separating the employment component from the civil-law component. Only the employment portion attracted statutory severance under the Kodeks pracy (Labour Code, KP).

For the second employee, we prepared a chronological file showing that the redundancy decision had been documented in board minutes dated six weeks before the internal report was submitted. That sequence was material. The rebuttal of the whistleblower presumption required demonstrating that the decision predated – or was independent of – the report. We secured the board minutes, the HR workflow records, and the original restructuring plan approved by the supervisory board.

How did the process before the Labour Court unfold?

We secured a favourable outcome for the client in both proceedings. For the first employee, we reached a settlement within forty-five days of the initial hearing. The corrected three-month severance was paid, supplemented by a modest additional sum covering the delay in payment. The total settlement amount remained below PLN 28,000 – significantly less than the reinstatement cost the employee had originally sought.

The second case took longer. The Labour Court in Warsaw scheduled three hearings over a period of four months. PIP's inquiry ran concurrently and produced no findings of retaliatory intent, which the court noted in its reasoning. The court ultimately dismissed the employee's claim, accepting the employer's documentary evidence that the restructuring plan predated the internal report by six weeks.

One practical complication arose regarding an employee who held an EU Blue Card and a work permit Poland issued under the single-permit procedure. Termination of the employment contract triggers an obligation to notify the Voivode (regional governor) within seven days. Failure to notify can affect the employee's legal stay and expose the employer to an administrative fine. Our team ensured that all notifications were filed within the statutory window.

We also confirmed that the remaining nine employees received corrected severance statements within fourteen days of the original termination date, avoiding the statutory interest that accrues on delayed employment payments at a rate linked to the National Bank of Poland's reference rate.

What lessons apply to future restructurings?

The Mazowieckie matter produced four transferable lessons for employers planning reductions-in-force in Poland. An employment lawyer Warsaw-based or otherwise should review these before any notice is issued.

  • Verify seniority across all predecessor entities before calculating the bracket. Mergers, demergers, and asset transfers can all preserve continuity of employment under Polish law.
  • Audit variable pay components against the contractual documentation. A bonus described as discretionary in the offer letter but guaranteed by the scheme rules will be included in the base.
  • Check whether any employee has filed an internal report in the twelve months preceding the planned termination. The whistleblower protection presumption is automatic and shifts the burden to the employer.
  • For foreign nationals, confirm permit notification obligations on the day of termination – not after the settlement is signed.

The cap of fifteen times the minimum wage is also frequently misapplied. In 2026, the minimum wage in Poland is PLN 4,666 per month. The statutory cap therefore stands at PLN 69,990. High-earning employees whose contractual severance under a separate agreement exceeds this figure should be advised that the statutory floor and contractual ceiling operate independently.

What to prepare before issuing redundancy notices:

  • Complete employment history file, including predecessor-entity periods
  • Three-month pay breakdown including all variable components
  • Internal report register covering the preceding twelve months
  • Work permit and residence documentation for all foreign nationals
  • Board or supervisory-board minutes approving the restructuring plan

Specific situations require tailored analysis. A redundancy that looks straightforward on day one can become costly if the seniority bracket is wrong or if a whistleblower presumption attaches – and both consequences are difficult to reverse once proceedings begin.

To receive an expert assessment of your company's severance exposure before a restructuring, contact info@kordeckipartners.com.

Frequently asked questions

Q: Does the severance cap apply to contractual severance agreed in the employment contract?

A: The statutory cap of fifteen times the minimum wage applies to severance paid under the Act on Special Principles for Terminating Employment Relationships with Employees for Reasons Not Related to Employees. Contractual severance agreed separately is not capped by statute, but payments exceeding the statutory amount may be subject to income tax rather than the exemption that applies to statutory severance. Employers should review the tax treatment of any top-up payment before issuing the settlement.

Q: How long does an employee have to challenge a severance calculation?

A: An employee must file a claim before the Labour Court within twenty-one days of receiving the termination notice, or within twenty-one days of becoming aware of grounds for the claim. Missing this deadline generally precludes reinstatement claims, though claims for outstanding monetary amounts may have a longer limitation period under general civil law. Early legal review of the calculation therefore benefits both parties.

Q: Does the whistleblower protection apply to employees on fixed-term contracts?

A: Yes. The Act on the Protection of Persons Reporting Violations of Law applies to all employment relationships regardless of contract type, and also extends to civil-law contractors and trainees. The twelve-month presumption of retaliation therefore applies to fixed-term employees. Employers terminating fixed-term contracts during or shortly after an internal reporting process should document the independent business rationale with the same rigour applied to indefinite-term terminations.

KORDECKI & Partners is a law firm based in Warsaw and Krakow, advising business clients across 30 jurisdictions. Our team combines expertise in Polish and international law with a practical approach to employment law, workforce restructuring, and cross-border mobility. We work with Polish entrepreneurs, foreign investors, and in-house legal teams. To discuss your situation, contact info@kordeckipartners.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. KORDECKI & Partners 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@kordeckipartners.com.