I’m All Right Jack

Life does not always imitate art. Fred Kite (played by Peter Sellers) the communist trade union shop steward in the classic 1959 comedy may well have been all right but in a real communist workers’ paradise, such as Poland, the one group (of many) for whom conditions fell far short of paradise was, of course, the workers.

Although free trade unions played a vital part Poland’s struggle to break free from the communist shackles, there is among employers a wariness of trade union involvement amongst their employees especially where a business is being acquired by a company which itself has no trade union involvement. The assumption seems to be that the Polish Labour Code provides, by the standards prevailing elsewhere, excessive protection to employees. But is this really the case?

Under Polish law, where a business is transferred the new employer becomes the employer in the place of the former employer on all employment relationships existing on the date of transfer of the business, both the new and former employers being jointly and severally liable for all the existing obligations resulting from the employment relationship. It should also be remembered that, in any case, within two months of the transfer of the business an employee may, upon seven days’ advance notification, terminate his employment. The termination of employment in these circumstances has the same effect on the employee as termination of the employment relationship by the employer with notice.

In addition, where trade union operates in the business, both buyer and seller must to inform the trade union branch in writing about: the expected date of transfer of the business to the new employer; the reasons for the transfer; the legal, economic and social consequences of the transactions for the employees; and any intended changes relating to the conditions of employment. This information must be provided not later than 30 days prior to the expected date of the transfer of the business. During these 30 days both parties are obliged to start negotiations with the trade union in order to conclude an understanding.

In particular, the employer is obliged to inform the trade union in writing of any intention to terminate a contract of employment made for an indefinite period (the most common type and generally terminable on three months’ notice) and must give a reason for termination of the contract. If the trade union branch decides that such a notice would be unjustified, it may present the employer with its written objections within five days from receiving the information. The employer is, however, not bound by these objections may proceed with the termination notice, bearing in mind that the objections of the trade union branch may be used by the employee during any subsequent labour court case.

In other words, although the employer is obliged to consult on, it is not obliged to obtain the trade union branch’s consent for, the proposed termination of the employment. And, as you might expect, the transfer of the business to a new employer is not considered to be a reason justifying termination of employment by notice. If within those 30 days the negotiations are ineffective and an understanding is not reached, the employer may take independent action with respect to the conditions of employment. Given the complexity and cost of most business transfers, this is not quite the onerous burden imagined.

But the Fred Kites do have one advantage. The trade union branch operating in a business is entitled to adopt a resolution indicating certain of its members (the number depends on the size of the trade union membership in the business) who are entitled to represent the union towards the employer. These employees are under special protection and their employment may not be terminated without the consent of the board of the trade union branch, except in exceptional cases such as the bankruptcy or liquidation of the employer. Perhaps I’m all right, Jack, after all.

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