PIP Can Reclassify Your B2B Contract as Employment by Decision. What to Do Before the Inspector Arrives.

Until recently, someone had to go to court to convert your B2B contract into an employment relationship. On 8 July 2026, the roles were reversed. Now it is the labour inspector who issues an administrative decision establishing the existence of an employment relationship — and you have limited time to appeal it. The inspector does not even have to visit your premises. They can request an export of data from your HR system, analyse schedules, login records and settlements, and then issue a decision on that basis.

The Act of 11 March 2026 amending the Act on the National Labour Inspectorate (Journal of Laws 2026, item 473) has entered into force and changed the rules of the game for every company using B2B contracts, contracts of mandate or contracts for specific work. The legislation is now in force. The question is not “when should we prepare?”, but “what should we do now?”.

In this article, you will learn exactly what the amendment has changed, what financial and operational risks are associated with reclassifying contracts, and in what order to prepare your company — from mapping contracts and assessing risk to establishing an inspection procedure.

Key concepts you need to know

Before we go into detail, let us clarify the terminology. The legislation uses concepts that have specific implications for your company.

What the amendment to the Act on the National Labour Inspectorate has changed

An administrative decision instead of court proceedings

Until 8 July 2026, the process worked as follows: an inspector could only bring an action to establish the existence of an employment relationship. The case went to court, continued for months, and the burden of proof was shared between the parties.

Since 8 July 2026, a labour inspector has been able to independently issue an administrative decision establishing the existence of an employment relationship (Article 11(1)(7a) of the Act on the National Labour Inspectorate). This decision determines seven elements at once:

1. The parties to the employment relationship
2. The date on which the employment relationship began
3. The type of employment contract
4. The type of work
5. The place where the work is performed
6. Remuneration
7. Working hours

This is not a general statement. It provides a ready-made basis for further social security, tax and employment-related settlements.

Two routes available to the National Labour Inspectorate — neither is convenient for the company

The National Labour Inspectorate has retained the right to bring an action to establish the existence of an employment relationship (Article 11(1)(11) of the Act on the National Labour Inspectorate). It therefore has two routes to choose from:

The difference is fundamental. In the case of an administrative decision, it is the company that must act — preparing an appeal and evidence within a limited timeframe. In the case of an action for a declaration, the initiative lies with the authority.

Order to remedy infringements — the warning stage

Before issuing a decision, the inspector may issue an order to remedy infringements. This is a signal that the authority has identified a problem. The company’s response to the order has a direct impact on how the case proceeds.

Silence or a one-sentence response stating “we disagree” is the worst-case scenario. Failure to comply with the order provides grounds for proceeding to a decision.

Remote inspections — the end of the time buffer

The Act allows inspections or individual inspection activities to be conducted remotely — using electronic means of communication (text of the amending Act). The inspector may request documents in electronic form. The inspection report may be prepared electronically.

The few days that companies previously had between receiving notice and the inspector physically arriving are gone. The data comes directly from the company’s systems — schedules, login records, time-reporting tools, calendars and messaging platforms.

Targeted selection for inspection based on Social Insurance Institution and National Revenue Administration data

The National Labour Inspectorate does not conduct inspections at random. Its inspection planning model is based on risk analysis using three categories (low, medium and high), updated every three months (Order No. 14/26 of the Chief Labour Inspector). The model takes account of data from the databases of the Social Insurance Institution and the National Revenue Administration.

The explanatory memorandum to the draft Act amending the Code of Civil Procedure of 13 April 2026 (legislative number of the National Labour Inspectorate reform: UD283) explicitly confirms: “The Social Insurance Institution will also be required to provide information about identified irregularities.”

In this model, a company where dozens of sole traders issue very similar invoices for very similar amounts to a single customer every month is a signal, not statistical background. Recurring settlement patterns visible in the databases of the Social Insurance Institution and the National Revenue Administration may trigger a scheduled inspection without waiting for a complaint.

Contact us — we will help you assess whether your company is at increased risk of inspection.

Enforceability of decisions and the appeal procedure

Does the decision take effect immediately?

A decision of the National Labour Inspectorate establishing the existence of an employment relationship is not automatically enforceable immediately. It becomes enforceable in one of three circumstances (Article 11(2k) of the Act on the National Labour Inspectorate):

1. On the day after the appeal deadline expires — if the company has not filed an appeal
2. On the date the court judgment becomes final
3. Earlier — if the decision is declared immediately enforceable

As a rule, an appeal filed on time prevents the decision of the National Labour Inspectorate itself from becoming enforceable. This is important — but there are limits.

An appeal blocks the decision, but not the Social Insurance Institution or the National Revenue Administration

Filing an appeal suspends the enforceability of the decision of the National Labour Inspectorate itself. However, it does not automatically suspend social security obligations owed to the Social Insurance Institution or tax obligations owed to the National Revenue Administration. These require separate determinations by the competent authorities.

A company may therefore find itself in a situation where the decision of the National Labour Inspectorate is suspended, but the Social Insurance Institution or the National Revenue Administration is conducting its own proceedings based on information obtained through inter-agency data sharing.

How the appeal procedure works

An appeal against a decision of a district labour inspector must be lodged through the district labour inspector with the regional court. The inspector may amend or revoke the decision if they consider the appeal justified. Otherwise, the inspector forwards it to the court together with the case file (Article 14b of the Act on the National Labour Inspectorate).

The court may suspend the immediate enforcement of the decision on its own initiative during the proceedings.

Note: Available sources provide conflicting information regarding the exact appeal deadline (7 days in the context of enforceability, one month in the context of the general procedure). The full wording of Article 14b(8) of the Act on the National Labour Inspectorate should be verified in the official consolidated text. Consult a lawyer about the specific deadline before taking action.

Time scope of the decision’s effects

As a rule, the decision takes effect from the date on which it is issued. But there is a catch: if the contract was terminated during the inspection, the relevant point of reference becomes the date on which the inspection was initiated, not the date on which the decision was issued.

Quickly terminating contracts with contractors after the inspector arrives does not close the matter — on the contrary, it may worsen the company’s position.

Financial and operational risks following the reclassification of B2B contracts

Social security contributions — the biggest cost

Reclassifying a contract changes the basis for social insurance coverage. Instead of contributions and settlements arising from business activity or a contract of mandate, there is an employment relationship. The consequences include:

As a rule, social security contribution liabilities become time-barred 5 years after they become due (Article 24(4) of the Social Insurance System Act). The limitation period may be suspended if the issue of a decision by the Social Insurance Institution depends on a determination by another authority or court.

For contracts for specific work, the difference is greatest — the starting point is the absence of any basis for social insurance coverage.

The economic burden falls on the contribution payer. Recovering the employee-funded portion of the contributions from the individual is difficult and contentious in practice — there is no established case law determining such claims in the context of B2B reclassification.

Tax implications

The income ceases to be income from non-agricultural business activity. It becomes employment income. The company assumes the role of remitter of personal income tax advances for the periods covered by the reclassification. For the contractor, questions arise concerning the flat-rate tax or lump-sum tax already accounted for as part of their business activity.

VAT implications — no clear rules

Article 106j(1) of the VAT Act requires a corrective invoice to be issued if, after an invoice has been issued, the taxable amount changes or an error is identified (Journal of Laws 2026, item 1263). Article 108(1) establishes an obligation to pay the tax shown on the invoice — regardless of whether it was due.

There is no general tax ruling or judgment determining what happens to invoices for the periods covered by reclassification. Correcting an invoice does not necessarily eliminate the obligation under Article 108(1). The issue requires a separate tax analysis.

Employment implications

Following reclassification, the company becomes an employer with the full range of obligations:

1. Overtime pay and allowances
2. Payment in lieu of unused annual leave
3. Protection against termination (Article 11(2l) of the Act on the National Labour Inspectorate — the decision may not serve as grounds for unfavourable treatment of the employee)
4. Obligation to keep working time records
5. Occupational health and safety obligations
6. Maintaining personnel files

Scale effect

When dozens of contracts are involved at the same time, the liability is no longer the cost of a single case. It becomes a balance-sheet item. The initiation of proceedings by a labour inspector interrupts the limitation period for employee claims (3 years — Article 291 § 1 of the Labour Code). Once interrupted, the limitation period begins to run again when the decision or court judgment becomes final.

An additional layer of risk — criminal liability

Article 218a § 1 of the Criminal Code provides for a penalty for the malicious or persistent infringement of employee rights arising from an employment relationship or social insurance: a fine, restriction of liberty or imprisonment for up to 2 years. If a company knowingly maintained a sham civil-law arrangement under conditions characteristic of an employment relationship, this may open not only an administrative route, but potentially a criminal one as well.

Article 304 § 2 of the Code of Criminal Procedure requires state institutions (including the Social Insurance Institution) to immediately notify the public prosecutor’s office of a suspected offence prosecuted ex officio.

What determines classification — not the name of the contract, but how the work is performed

The inspector assesses how the work is actually performed, not the heading of the contract or the parties’ shared intention. Article 22 § 1¹ of the Labour Code states explicitly: employment under the conditions characteristic of an employment relationship constitutes employment under an employment relationship, regardless of the name of the contract concluded.

No single characteristic determines the case. What matters is the combination of characteristics and a consistent overall picture of subordination.

Characteristics of an employment relationship under Article 22 § 1 of the Labour Code

A common mistake: the B2B contract refers to deliverables and independence, while in practice there is a schedule, fixed working hours, a company supervisor, reporting through an HR tool and no genuine possibility of substitution. The contract says one thing, while the reality is another.

Another common mistake: two people in the same position perform identical tasks — one under an employment contract and the other on a B2B basis, with no justification for the difference. This is evidence in itself.

The correct sequence of actions — what to do now

The outcome of the case is determined by what the company has in its records on the date the inspection is initiated, not by what it adds after the inspection has ended. In practice, this amounts to evidentiary preclusion. That is why the order in which you act matters.

Step 1: map your contracts

Prepare an overview of all civil-law and B2B contracts. For each contract, determine:

1. The parties and the date on which the cooperation began
2. The subject matter of the contract and the settlement model (hourly, fixed amount or based on a deliverable)
3. The place and time where the work is performed
4. The functional supervisor — who actually assigns tasks
5. Whether the contractor has other clients and bears business risk

Step 2: assess risk against each characteristic under Article 22 § 1 of the Labour Code

Assess each group of contractors separately. Do not rely on a general impression; analyse each characteristic of an employment relationship individually: type of work, personal performance, subordination, place and time, remuneration and business risk.

Identify positions in which employees and B2B contractors perform identical tasks. Prepare a justification for the difference or eliminate it.

Step 3: decide on the operating model

Based on the map and risk assessment, decide:

1. Which positions will be converted to employment
2. Which arrangements may remain B2B — after changing the practices
3. Which arrangements should be terminated

Starting by amending contracts without first mapping them and assessing the risks is a common mistake. The result is that the documentation departs even more clearly from actual practice.

Step 4: implement changes in documentation and practice

Only now should you update contracts, clarify the rules of cooperation and put internal communications in order. Verify who is covered by HR regulations, policies and procedures — make sure they do not expressly apply to B2B contractors (e.g. leave requests, schedules and workplace regulations).

Check whether the contracts provide a genuine possibility of substitution and whether this is actually used. The absence of substitutability is one of the strongest indicators of subordination.

Step 5: National Labour Inspectorate inspection procedure

Establish a written procedure with assigned roles:

1. Who receives and escalates correspondence from the National Labour Inspectorate
2. Who serves as the sole point of contact with the inspector
3. Who collects and verifies documents before they are provided
4. Who conducts substantive discussions with the inspector
5. Who decides how to respond to an order to remedy infringements
6. Who monitors the appeal deadline
7. Who has permission to export data from systems and verifies the scope of the authority’s request

A real-life scenario: a letter arrives at reception, no one knows who is responsible for contacting the inspector, and an IT employee exports data from the system without verifying the scope of the request. This is a situation you want to avoid.

Step 6: train line managers

Managers create evidence. Their day-to-day conduct — schedules, instructions, availability requirements and reporting — generates evidence in cases seeking to establish an employment relationship. Inspection evidence is created in everyday practice, not by the legal department during the inspection.

Explain to leaders how to assign tasks and communicate with contractors without creating an employment relationship.

Step 7: estimate financial exposure

Calculate the potential cost of reclassification for each group of contractors: contributions with interest, personal income tax advances, overtime and payments in lieu of leave. With dozens of contracts, this is a budgeting exercise, not an academic one.

Step 8: secure evidence

Collect documents confirming the contractors’ independence:

1. Offers submitted to other customers
2. Business correspondence with other clients
3. Project documentation confirming independent decision-making
4. Evidence of bearing business risk (own equipment, liability insurance, investment in development)

Individual interpretation issued by the Chief Labour Inspector — a tool that can easily be used against you

The Chief Labour Inspector issues individual interpretations upon request. Fee: PLN 40. Deadline: 30 days. The interpretation is binding on the authorities of the National Labour Inspectorate with respect to the matters covered by the question (information from the National Labour Inspectorate).

Since 8 July 2026, the Chief Labour Inspector has issued 7 individual interpretations (National Labour Inspectorate announcement). No interpretation is issued if the matter is already covered by proceedings before the National Labour Inspectorate or the Social Insurance Institution.

The trap: the company applies for an interpretation, describing the intended model instead of its actual practices. During an inspection, the document works against the company — it demonstrates the discrepancy between its declarations and the facts.

If you are considering seeking an interpretation, describe your actual practices, not an idealised version. An interpretation based on circumstances that do not reflect day-to-day reality is a weapon in the inspector’s hands.

Initial results of inspections after 8 July 2026

Since the new legislation entered into force, the National Labour Inspectorate has conducted more than 100 inspections concerning whether the choice of a civil-law contract was justified; 35 of them have been completed (National Labour Inspectorate announcement). Complaints concerned, among others, services, retail, manufacturing, healthcare providers and nationwide restaurant chains.

As of the publication date, there is no confirmed case of the first administrative decision establishing the existence of an employment relationship (with a date, number and appeal status). This does not change the fact that inspections are ongoing and the authority is actively exercising its new powers.

Penalties for failing to comply with an order and obstructing an inspection

Failure to comply with an enforceable order of the National Labour Inspectorate within the prescribed period and obstructing the inspectorate’s activities (preventing an inspection visit or failing to provide information) are offences under Article 283 § 2(7) and (8) of the Labour Code. The standard range of fines is from PLN 1,000 to PLN 30,000 (Labour Code — ISAP), although the amending Act includes changes concerning the amounts of fines — their exact scope should be verified in the current consolidated text.

We can help you

Preparing your company for the new powers of the National Labour Inspectorate is not about changing a few contractual clauses. It means changing how managers assign tasks, how HR systems record data and how the company responds when contacted by an inspection authority.

Our support includes:

1. Audit of cooperation models — mapping contracts, assessing risk against each characteristic under Article 22 § 1 of the Labour Code and estimating financial exposure
2. Operating model decision and implementation of changes — not only in documentation, but also in the team’s day-to-day practices
3. Written National Labour Inspectorate inspection procedure — with assigned roles, an escalation path for orders and measures to safeguard deadlines
4. Training for line managers — so that day-to-day conduct does not generate evidence
5. Preparing an application for an interpretation by the Chief Labour Inspector — based on actual rather than intended practices
6. Support during inspections and appeals — from the first letter through to the conclusion of the proceedings

We combine employment law with business context — the structure of cooperation, settlement models and the company’s growth plans. This ensures that staffing decisions are aligned with the organisation’s direction.

The legislation is in force — it is time to act

The Act entered into force on 8 July 2026. The National Labour Inspectorate is conducting inspections. The selection model based on data from the Social Insurance Institution and the National Revenue Administration is operational. Companies that have not put their cooperation models in order face risks that increase with every passing month.

The correct sequence is: map contracts → assess risk → decide on the operating model → implement changes → establish an inspection procedure → train managers. Starting at the end — with amendments and documentation — produces paperwork that will not withstand scrutiny against day-to-day practices.

If you use B2B contracts, contracts of mandate or contracts for specific work and want to assess your company’s exposure, contact us. We will help you through the entire process: from diagnosis to inspection readiness.

Frequently asked questions

Does a contractor’s consent to a B2B arrangement and their own choice of this form protect the company against a decision by the National Labour Inspectorate?

No. Article 22 § 1¹ of the Labour Code states that employment under the conditions characteristic of an employment relationship constitutes employment under an employment relationship, regardless of the name of the contract concluded. The inspector assesses how the work is performed, not the parties’ intentions. A contractor’s consent to a B2B arrangement does not change its classification if the work is performed under supervision, at a specified place and time.

Does a decision by the National Labour Inspectorate retroactively cover previous years of cooperation?

As a rule, the decision takes effect from the date on which it is issued. If the contract was terminated during the inspection — from the date on which the inspection was initiated. Earlier periods may, however, still be covered by an action to establish the existence of an employment relationship (the second route available to the National Labour Inspectorate) and proceedings before the Social Insurance Institution, where contribution liabilities become time-barred 5 years after they become due.

Following reclassification, can I recover the contractor’s share of the contributions from them?

Available sources do not confirm that an employer automatically has a claim against a former contractor for reimbursement of the employee-funded portion of social security contributions. Any such claim would require a separate legal basis (e.g. unjust enrichment) and an assessment of the limitation period. There is no established case law determining this issue in the context of B2B reclassification. Consult a lawyer before taking action.

Is it worth applying to the Chief Labour Inspector for an individual interpretation?

It can be a useful tool (PLN 40, 30 days, binding on the authorities of the National Labour Inspectorate), provided that you describe your actual practices. An interpretation issued on the basis of an idealised description of the cooperation may work against the company during an inspection — demonstrating the discrepancy between its declarations and the facts. No interpretation is issued if the matter is already covered by proceedings before the National Labour Inspectorate or the Social Insurance Institution.

What data can an inspector obtain remotely from our systems?

The inspector may request personnel files and any documents in electronic form, provided that the request is related to the subject matter and purpose of the inspection. This may include: login records, schedules, time-reporting tools, calendars, distribution lists and workplace messaging platforms. Determine in advance who in the company has permission to export data and who verifies the scope of the authority’s request before the data is provided.

What should we do in the first few hours after receiving an order to remedy infringements?

Activate the inspection procedure: identify the person responsible for contacting the inspector, verify the scope of the order, obtain internal input from the line manager and HR department, and consult a lawyer about the wording of the response. Set an internal response deadline that is shorter than the deadline imposed by the authority. Do not respond with a single sentence stating “we disagree” and do not remain silent — failure to comply with the order opens the way for an administrative decision.