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New EU directive could harm Polish economy

ECONOMYNew EU directive could harm Polish economy

News from the government about the resignation from the introduction of the so-called entrepreneur test is good news for the Polish economy. However, a new EU directive concerning the labor market, which has been preliminarily accepted by the European Parliament and the Council of Europe, can bring totally reverse effects.

The accepted project radically limits the possibilities for self-employment and B2B agreements, introducing on a large scale the presumption of employment status. This means that people providing services for employers will automatically be treated as employees, even if they are not directly subordinate to them.

The Representative for Small and Medium Enterprises, Adam Abramowicz, believes that this solution is a classic example of excessive bureaucratic interference in natural market processes.

“Long-term economic stagnation of EU countries is largely the result of over-regulating the European economy by EU legislation. Against this backdrop, Poland’s situation is relatively favorable” – says Abramowicz. “The rapid economic growth and high competitiveness of Polish enterprises observed for many years are the result of, among others, labor market regulations. In the reality of our economy, civil law contracts play a positive role in the market.”

The Representative points out that civil law contracts are often used by small and medium enterprises to flexibly adapt to changing market conditions. Thanks to them, companies can employ workers based on needs, without the need to conclude long-term employment contracts.

“It is true that an employment contract better protects the rights of the employee. But instead of promoting it with artificial regulations, it is worth trusting spontaneous market processes” – emphasizes Abramowicz. “The rapid economic development of our country results in a record low unemployment rate. The labor market today is the market of the employee, not the employer. The latter, in order to get an employee, offer not only higher and higher salaries, but also a more stable form of employment.”

If the current labor market directive project is accepted without proper adjustments and in a hurry, it will once again mean the undercutting of European competitiveness. Instead of protecting workers’ rights, the directive could cause another wave of bankruptcies, especially of small and medium-sized companies, and consequently deepen unemployment.

“The role of Polish MEPs and the Polish government is to protect the balance between the interests of employers and workers” – says Abramowicz. “Only such balance will ensure the increase in the wealth of Poles.”

The adopted directive must undergo further negotiations between the European Parliament and the Council of the European Union. Its final version is to be accepted in 2024.

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