A Kraków-based IT company terminates 12 employees due to redundancy. The HR team calculates severance using last month's salary figures – then discovers, three weeks later, that the calculation basis was wrong. The resulting underpayment exposes the company to individual claims before the Labour Court (Sąd Pracy). Correcting the error costs more than getting it right the first time.

Polish labour law sets mandatory severance pay for employees dismissed through collective or individual redundancy. The amount depends on length of service: one month's pay for up to two years, two months' for two to eight years, and three months' for over eight years. A statutory cap limits severance to 15 times the minimum wage – currently PLN 32,100 gross (2026 minimum: PLN 4,666 per month × 15).

This alert covers the calculation rules, the most common errors that trigger claims, and the immediate steps employers should take to audit their payroll process now.

What does Polish law require for severance pay?

Polish labour legislation – specifically the ustawa o szczególnych zasadach rozwiązywania stosunków pracy z przyczyn niedotyczących pracowników (Act on Collective Redundancies) – obliges employers to pay severance whenever a dismissal is caused by reasons on the employer's side. This applies to collective redundancies and to individual dismissals where the employer's reason is the sole ground. The obligation arises regardless of whether the employee holds a work permit Poland or is an EU Blue Card holder; the same rules apply to foreign nationals employed under Polish contracts.

The three service-based tiers are calculated from the date of hire to the date notice is given – not the date employment ends. Employers registered in the National Court Register (Krajowy Rejestr Sądowy, KRS) and those operating as sole traders with staff both fall within scope. The State Labour Inspectorate (Państwowa Inspekcja Pracy, PIP) enforces compliance and may audit payroll records going back three years.

One figure matters immediately: the PLN 32,100 cap for 2026. Any employee whose three-month equivalent exceeds this ceiling receives the capped amount. Failing to apply the cap correctly – in either direction – constitutes a calculation error.

What are the most common calculation errors that trigger claims?

The calculation base is not simply the contractual base salary. Under Polish employment law, the base must reflect the employee's full fixed remuneration, calculated using the same methodology as holiday pay – including fixed allowances, regular bonuses, and shift supplements. Variable components require averaging over the preceding three months (or 12 months for highly variable pay). An employment lawyer Warsaw-based practitioners frequently see the same pattern: employers use the payslip total from the last month, which may include irregular items or exclude fixed supplements paid quarterly.

We secured a correction of severance underpayments exceeding PLN 180,000 for a manufacturing client in the Silesia region (spring 2025). The employer had excluded a fixed site allowance from the calculation base for all affected employees. The Labour Court awarded the difference plus statutory interest.

Three further errors appear regularly:

  • Counting service years from the probationary period end rather than the actual hire date.
  • Ignoring prior employment with related entities when calculating continuity of service.
  • Applying the 2025 minimum wage cap instead of the updated 2026 figure.

A whistleblower Poland scenario adds another layer. Employees who reported irregularities internally before dismissal may argue the redundancy was retaliatory. If a Labour Court agrees, the employer loses the redundancy justification entirely – and severance liability may convert into reinstatement or compensation claims. The PIP enforcement powers in 2026 extend to investigating the genuine basis of dismissals alongside payroll accuracy.

What should employers do right now?

The limitation period for severance claims is three years from the date payment was due. That window is long enough to turn a historic payroll error into a significant liability. Employers planning redundancies in Q1 or Q2 2026 should act before issuing any notices. Employers who completed redundancies in 2023 or later should audit past calculations while the correction window remains open.

We obtained a pre-litigation settlement for a logistics client in the Małopolska region (winter 2025), resolving 23 individual severance claims for a total amount below the original litigation exposure. Early internal review made the difference.

Immediate action items:

  • Confirm the 2026 minimum wage cap of PLN 32,100 is programmed into your payroll system.
  • Verify the calculation base includes all fixed remuneration components, not just base salary.
  • Check service continuity records, including any prior employment within the same group.
  • Review any dismissals from 2023 onward where the calculation basis is uncertain.

Foreign investors should note that posted workers arriving under A1 certificates from other EU member states are subject to Polish severance rules for the duration of their posting. The rules on posted workers from Spain to Poland and A1 certificates clarify how Polish mandatory provisions interact with home-country contracts. Separately, employers under KAS scrutiny should be aware that payroll records reviewed during a KAS tax audit may surface severance miscalculations as a secondary finding.

The PIP may impose fines of up to PLN 30,000 per violation for failure to pay severance correctly. Personal liability of management board members is possible where the company is insolvent and severance claims remain unsatisfied. Neither outcome is reversible once enforcement begins.

Your company's specific severance exposure depends on headcount, pay structure, and dismissal history. An incorrect calculation made today forfeits the opportunity to settle before claims are filed – and that window closes permanently once proceedings begin. To receive an expert assessment of your severance calculation process, contact info@kordeckipartners.com.

Frequently asked questions

Q: Does severance apply when an employee resigns voluntarily?

A: No. Polish law limits the mandatory severance obligation to dismissals caused by reasons on the employer's side. A voluntary resignation, mutual termination at the employee's initiative, or dismissal for cause does not trigger the statutory severance entitlement under the Act on Collective Redundancies.

Q: How long does the employer have to pay severance after the dismissal takes effect?

A: Severance becomes due on the last day of employment. Payment on that date is the standard expectation. Delay triggers statutory interest at the rate applicable to overdue employment claims, currently above 11% per annum, and exposes the employer to a PIP fine of up to PLN 30,000.

Q: Is it a common misconception that part-time employees receive reduced severance?

A: Yes. Many employers incorrectly assume that a part-time contract reduces the number of monthly equivalents owed. The service-based tiers – one, two, or three months – apply in full regardless of working-time fraction. Only the monthly pay figure itself reflects the part-time rate, not the number of months payable.

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.