Poland’s technology industry is raising the alarm: the proposed reform of the National Labour Inspectorate (PIP), which would grant inspectors the administrative and immediately enforceable power to determine the existence of an employment relationship, may lead to serious disruptions in the functioning of technology companies and weaken the competitiveness of the entire Polish digital economy. SoDA – the Organization of Employers of IT Services, representing nearly 120 companies and over 30,000 specialists – has published a position paper that thoroughly analyses the consequences of the reform and argues that the draft, in its current form, contradicts market realities and long-standing state policy.
The reform would allow PIP inspectors to unilaterally convert civil-law contracts — including B2B contracts — into employment contracts, even against the explicit will of both parties, while making their decisions immediately enforceable. According to SoDA, this would be a systemic shift that could fundamentally reshape how knowledge-based companies operate, especially those in the software development sector. The organisation warns that giving such broad discretion to an administrative authority not only exceeds the intended goals of the amendment, but also creates the risk of a sudden increase in labour costs, an outflow of talent and destabilisation across thousands of companies. Moreover, the proposed measures contradict the state’s long-established strategy, which for over a decade has actively promoted self-employment, entrepreneurship, R&D-oriented incentives such as the B+R relief or IP Box, and preferential tax schemes for the IT sector.
The Importance of the ICT Sector for the Polish Economy
As SoDA notes, the IT/ICT sector is one of the pillars of modern Poland. It generates 3.5% of GDP, drives the export of digital services, and accounts for over 16% of Poland’s service exports — worth more than USD 16.8 billion annually. The industry has been growing at double-digit rates for years, and according to the latest data, it now employs nearly half a million people. These figures, however, capture only part of its impact: Polish IT professionals are a key resource for global companies, which increasingly establish teams, competence centres and R&D projects in Poland. Maintaining this position requires predictability and flexibility, as Polish companies cannot compete with global corporations on salaries, but can compete through their organisational model.
According to SoDA’s analysis, as much as 97% of the market consists of SMEs, where 70–90% of total costs are labour costs. In such an environment, any increase in public-law burdens has an immediate impact on profitability. The industry has also faced rising cost pressures for months — increasing salaries, rising talent acquisition expenses, and the high cost of implementing new technologies — while more than half of companies see no room to raise margins.
SoDA illustrates the scale of the problem with the example of a mid-sized IT company for which the forced conversion of 30 B2B contracts into employment contracts would generate approximately PLN 1.8 million in additional annual costs, shifting its financial result from a profit of PLN 840,000 to a loss of nearly one million. Hundreds of firms in Poland would face similar scenarios.
“A particularly contentious issue is the PIP’s proposed ability to retroactively reclassify contracts signed long ago. Implementing such measures overnight could drive many companies into bankruptcy,” emphasises Tomasz Szymański, CEO of SoftwareMill, a SoDA member.
The Biggest Crisis in the Industry’s History
The reform would not only affect employers — it would also directly impact IT specialists. For years, the industry has operated in a “developer’s market”: the talent shortage is persistent, and Polish experts can work for global companies from anywhere in the world. For many, the B2B model is a deliberate choice — it provides flexibility, the ability to cooperate with multiple clients and greater control over one’s professional development. Imposing employment contracts would mean the loss of tax preferences, reduced independence and, for many specialists, a decision to end cooperation with Polish companies in favour of international firms not bound by Polish law. This could lead to a substantial outflow of talent, reduced tax revenues and a weakened innovative potential of the Polish economy.
“The proposed PIP reform, in its current form, could trigger one of the biggest crises in the history of Poland’s IT sector. For years, Poland has built its technology ecosystem on flexibility, innovation and trust in legal stability. Today, that model is at risk. We call for dialogue, a thorough impact assessment and the creation of solutions that protect both workers and the competitiveness of the digital economy as a whole,” says Marta Kępa, Vice-President of SoDO.
Industry Proposals
The organisation argues that a stable labour market in IT requires transparent rules — clear criteria distinguishing B2B from employment, standardised inspection procedures and predictability in administrative actions. Therefore, SoDA proposes:
- developing an official checklist for entrepreneurs,
- piloting new solutions before full implementation,
- introducing a corrective period allowing companies to adjust cooperation terms before any formal decision is issued,
- establishing a “safe harbour” mechanism ensuring that contracts meeting compliance criteria cannot be subsequently challenged.
SoDA also stresses that the reform must not apply retroactively — imposing sanctions on companies and specialists for actions previously compliant with the law would violate the principle of trust in the state and would, in practice, amount to penalising lawful behaviour.
The organisation also highlights the need for a broader modernisation of the Polish Labour Code, which — in its view — no longer reflects the realities of modern project-based, remote, task-oriented and hybrid work models.
“We are ready to participate in legislative work, and as the representative of nearly 120 IT companies, we can provide expert knowledge, access to analyses and best practices from global markets,” says Paweł Pustelnik, Vice-President of SoDA and COO at Future Processing.
SoDA calls on the government to carry out a comprehensive regulatory impact assessment, including the effects on the IT sector, and to present the consequences of the planned reform to the highest state authorities. The organisation stresses that the IT sector is not just statistics — it is a strategic resource of a knowledge-based economy, shaping innovation, cybersecurity and the digital transformation of businesses and public administration. In a context of global competition and rapid technological progress, regulatory stability is not a convenience — it is a condition for survival.
SoDA declares its full readiness for further dialogue with the government, parliament and public institutions, emphasising that jointly developed solutions will make it possible to curb labour market abuses while preserving the flexibility and competitive advantages of Polish IT companies.
About SoDA
SoDA – the Organization of Employers of IT Services (Software Development Association Poland) is an association of Polish technology companies that develop software and provide IT outsourcing for clients worldwide. Established in 2018, it now brings together nearly 120 companies, mostly with Polish capital, operating across the country. These companies employ more than 30,000 IT specialists and in 2023 generated combined annual revenues of almost PLN 12 billion.
SoDA’s mission is to integrate the Polish IT industry and support its development. The organisation facilitates cooperation and knowledge exchange among its members and promotes Poland internationally as a leading market for software development and IT services.
Its activities include regular industry research and reports, legislative consultations, opinion-building on legal proposals affecting the technology market, and active participation in meetings with ministries and government representatives.
Source: ceo.com.pl
