Changes you need to know about Personnel Outsourcing and Process Outsourcing under new Poland Law
Poland's labour landscape has undergone significant changes with the introduction of new legislation impacting personnel outsourcing and process outsourcing. Previously, regulations in this area were less defined, leading to ambiguities and potential misuse. However, the newly enacted Act on the Conditions for Entrusting Work to Foreigners (March 20, 2025) (Ustawa z dnia 20 marca 2025 r. o rynku pracy i służbach zatrudnienia), which came into effect on 1 June 2025, clarifies the rules and introduces stricter oversight, particularly regarding the employment of foreigners.
In this article, we are going to highlight changes under the new regulation and illustrate the difference between personnel outsourcing and process outsourcing in the latest regulatory framework.
Key changes of Act on the Conditions for Entrusting Work to Foreigners (March 20, 2025)
The key changes introduced by the new law aim to prevent illegal employee leasing and ensure fair labour practices. Some key highlights include:
- Restrictions on Work Permits: Provincial offices are now mandated to refuse work permits if it appears the foreigner will be working for a third party through an entity that isn't a legally registered Temporary Employment Agency (Agencja Pracy Tymczasowej, APT). Similarly, district governors (starosta) will reject declarations of entrusting work if the work is being performed for a third party by a non-APT.
- Two-Year Grace Period for New Agencies: Newly registered employment agencies face a two-year waiting period before they can provide temporary work services (or job placement for foreigners requiring permits).
- KRAZ Registration Updates: Existing agencies were required to update their registration in the National Register of Employment Agencies (KRAZ) by August 31, 2025, to continue offering services related to foreigners.
- Increased Scrutiny: Migration and labour inspection regulations are tightening their control over outsourcing relationships, focusing on the true nature of the work, its organization, and supervision.
- Significant Penalties: The Act introduces substantial fines for violations. Unlawfully entrusting work to a foreigner can result in a fine ranging from PLN 3,000 to PLN 50,000. Foreigners unlawfully performing work face fines starting from PLN 1,000.
- Stricter Agency Requirements: Agencies now face more formal requirements, electronic registration, and increased scrutiny of their business operations.
Under Article 84(1) of this new Act, penalty of violation ranges from PLN 3,000 to PLN 50,000 for the agencies. The fine is up to PLN 1,000 for foreigner in violation.
Definition of Temporary Employment Agency (APT)
Temporary Employment Agency (APT) is a legally authorised entity, registered in KRAZ, that employs temporary workers and assigns them to other companies (the user company) for specific periods and tasks. The agency bears the employer's responsibilities, including contracts, pay, insurance, training, and occupational safety. The user company directs the day-to-day work within legal limits, but cannot "purchase working time" outside of legal assignment parameters.
Under the new regulation, agencies delegating foreigners must have been active for at least two years and meet strict registration, fee, compliance, and infrastructure requirements. APTs’ permits maybe denied if the setup resembles “work for a third party’ outside legal APT structures.
Establishment of personnel outsourcing and process outsourcing
With the new Act in place, segregating personnel outsourcing and process outsourcing is crucial for legal compliance. It is also critical to ensure your supply chain is ethical with minimised risks from hidden outsourcing processes.
Personnel Outsourcing (or "Employee Outsourcing"): This model involves an external company providing workers to a client, but the client directly supervises, directs, and organizes their work schedule. Payment is typically based on working time rather than service results. The outsourcing company primarily handles recruitment, paperwork, and payroll, lacking process management responsibilities.
This model carries significant risks, as it may be classified as illegal employee leasing, which is now explicitly prohibited for foreigners under the new rules. Ethical audits often identify this setup as a sham, characterised by civil contracts, a lack of process separation, and a lack of contractor independence.
Process Outsourcing (or Service Outsourcing): In this model, an external contractor performs a defined process or service, such as packing, cleaning, or warehouse handling, rather than simply providing workers. The contractor independently manages the process, including supervision, schedules, systems, documentation, and reports. The client defines the scope and performance criteria (quality, quantity, deadlines), but not the detailed methods. Payment is linked to results, not working hours, with the contractor bearing the risk and responsibility for those results. The client should not issue direct instructions to the contractor's employees.
A defensible process outsourcing model requires organisational or physical separation of the process, comprehensive documentation (around processes, reporting and tool/equipment agreements), a dedicated contractor coordinator, and time records kept by the contractor, not the client.
Potential indicators of sham process outsourcing
To ensure your outsourcing model is compliant to the new Act, these indicators should be assessed and well-observed when planning your outsourcing activities.
These are highly probable indicators that sham (personal outsourcing) exists:
- Contract: no KPI or result metrics
- Supervision: work direction from client’s staff
- Coordinator: not authorised or absent
- Time record: logged at client’s system
- Training: conducted by client
- PPE and other equipment: provided by client
- Work structure: mixed team on same line
- Overtime: ordered by client
- Invoicing: hourly billing
In conclusion, the new Act on the Conditions for Entrusting Work to Foreigners brings significant changes to personnel and process outsourcing in Poland. Businesses must carefully review their existing arrangements and ensure compliance with the new regulations to avoid penalties and maintain ethical labour practices.
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The above changes and citations are based on applicable regulations and expert analyses. Legal consultation is required for specific cases.
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