Poland's indecent junk capitalism?

Poland's junk capitalism (śmieciowy kapitalizm) has created an amoral monster which will sweep away all norms of decency, opines Toruń University professor Andrzej Szahaj.

wyborcza.biz/biznes/1,100897,18402261,smieciowy-kapitalizm-w-polsce-oplaca-sie-granie-nie-fair.html#TRNajCzytSST

My question: The Polish ocnstitution reportedly describes the Polish economy as a "social market economy". Does it live up to that description? Which countries in your view come closest in that regard?

what I think worse than in Poland are the socalled '0 hour" contract in UK (for me: if 0 hour = unemployment ;)) and the "mini jobs" in Germany. I'm talking about "civilized" countries because no need to mention situation in Bengladesh, Nigeria or Bolivia ;).

I read yesterday that garbage contracts were also used by (Polish) gouvernment when hiring employees...

All this is not only not moral but also very dangerous for the society's stability.

What I also "like" is when I hear people around me (well off Polish executives from Western firms) saying that "garbage contracts are good for Poland". When I hear some crap, I reply "why don't YOU work under contract?" and no answer from them other than a small embarrassed smile ;).

The question is: would eliminating garbage contracts entirely (by legislation as some are now proposing) wouldn't scare off foreign investors who mainly came to Poland as a cheap manpower and lucrative consumer-market country? Maybe the EU should finally do something worthwhile (rather than just promoting toxic light bulbs and perversion) and ban them bloc-wide?

If I don't get the offer and promised remuneration that I think I am worth, I stay at home and walk the dog. Unfortunately, there are some who think it worthy to work for scum wages. Funny, innit?

@Polonius: I doubt it exists elsewhere. No matter what, it's becoming to be an issue in Poland (several demonstrations lately, a lot of coverage now everyday in GW, a new political movement called "Razem", people like A. Grodzka (;)) talking about starting a "Siriza" movement in Poland...) and I suppose the new governement shall put it on their agenda...

How can people who work be expected to "live" with no benefits of any kind? This was "ok" in the 19th century but not any longer in 21st century ;).

That's exactly what would happen - unfortunately. The ones that are in Poland already would leave, and the rest of the investors wouldn't bother to come. At the moment, Poland has only two assets to attract foreign investments: highly educated people and low wages. Take one or both away, and the whole bubble will burst. Give it another 20 years, and the picture might look completely different.

On some jobs I do. I factor the guaranteed income in when giving the minimum price that I'll work for.


No, because such contracts basically do not exist in Poland.

Depends how you define "garbage contract". Having to work for a handout would fall into this category in my opinion. Can people in Poland actually survive on a minimum wage of 425.- EUR a month, or do they need a second job and government support?

Reputable Polish economist say up to one-third of Poles work on umowy śmieciowe. You know better?


Dog-walking ain't putting bread on your table, nless your exercising other people's dogs for a fee. You must have some other soruce of income. Only in songs can people live on love as in "I can't give you anything but love, Baby!"

Wprost says garbage contracts do exit and 3.5 million Poles earn their livelihood that way:
wprost.pl/ar/352730/35-mln-Polakow-pracuje-na-umowach-smieciowych

I think it is a bit more complicated than that. Many economists put contracts which are not "umowy o prace" (salaried contracts) in this category. But the reality is that many highly skilled workers prefer not to go for umowa o prace in Poland for tax reasons, since they pay only a 19% flat tax rate against a higher tax rate for salaried workers of 32%. I have worked so far in 5 different countries and,as an example, Poland is the only one where I saw most lawyers employed by financial institutions ( I am here talking about internal legal departments, not outsourced work) employed on the basis of civil law contracts and not salaried.

@Harry: "on some jobs I do" : so it's not your ONLY source of income. When people work ONLY on garbage contracts, believe me, the situation is much different (no vacation, no sick leave, no retirement, no credit ....)

Unfortunately nearly all political parties don't give a d... about working conditions. As far as I know only the SLD would like to abolish garbage contracts. How do PiS feel about topic since most probably they'll be in office in 3 months?

I see from the above that hardly anyone knows re umowa o dzieło, umowa zleczenie, umowa autorskie but some don't live in Poland so they cannot know.

Yesterday GW had a table in order to summarize.

In brief (for those who don't know), such contracts are not LABOR law contracts but CIVIL law contract and thus NO benefits (no health insurance (umowa zleczenie does though), no sick leave, no maternity leave, no vacation, no unemployment benefits, no retirement and no credit since not steady work). In other words, people are paid ONLY when they work and of course they are not paid when public holidays....

According to a source given by Polonius, 3.5 million Poles work this way. It's a scandal but hopefully it seems to become a hot issue in Poland now and although only SLD (just to mention main parties) are against, such contracts, I'm sure that others shall have to deal with issue too.

How can they expect people to "live" this way? I know some shall say it's "better than ... nothing" but it's rather sad if the choice is between "very bad and worse" ;). And no need to say, when they say 'it's better than nothing", they talk about others because bad things are always for the others, not for "me" ;).

As usual with them, they've pledged to abolish them. But we all know that they won't, for the simple reason that anyone with half a brain knows that many jobs would vanish overnight if they did - which would hurt their electorate badly.

Having said that, some changes are definitely happening. Umowa o dzieło is now very, very dangerous to use if it's not a genuine "dzieło" - the tax office has gone after many language schools for using it recently. Umowa zlecenia contracts are also starting to be scrutinised, particularly if it's in an area where the work is completely directed.

The problem is that for the employer, the burden of giving umowa o prace is just massive. The social protections provided by umowa o prace are huge - one lawyer friend estimated that in his experience, employers only win around 10% of disputes if umowa o prace is involved. Some of the provisions are staggering - imagine that someone is entitled to 60 days a year to care for a sick child? The system is just far too easy to abuse.

The solution (in my view) is to allow small businesses (say, under 50 employees) to grant a special kind of contract that offers restricted labour rights while still offering all the benefits in terms of health insurance, pension, etc etc. That kind of contract would allow small busineses to give people job security without them having to worry that Agnieszka the secretary is going to go off for 2 years on maternity/sick leave. As it stands, the current situation causes incredible discrimination towards women :(

@Delph: in other (at least EU) countries, people work under real work contracts so what's Poland's excuse? It seems that it's getting a hot issue in Polish politics now. There is even a movement (I don't know if we can call it "party") "Razem", which will run in the Fall election whose key idea is getting rid of such contracts. Of course they won't have anyone elelected but it is the beginning (as we can see inow n Greece, Spain...).

According to the news these days, garbage contracts are very frequent in the administration and I personally know several foreign companies in Warsaw (they happen to be among the top firms in the world) who employ more and more people on such contracts.

People have no security, no rights. Younger ones cannot start families, get credit to buy a flat, a car... People cannot get sick, cannot take vacation, don't have retirement ...

Yes, fantastic!

Since it does not exist anywhere else (or maybe in UK with their famous "0 hour contract" ;)) so what should it exist in Poland?

PS: I DO know what I'm talking about since I get around 75% of my income this way and fortunately I'll have retirement from my home country (although not "too high" since I did not work very long). Easy to be in favor of something bad when not concerned ;)

PPS: I agree with you with maternity and "education" leaves. Although education leaves are not paid in Poland, they are a hassle for employers but if we want a higher birth rate, it's necessary to help women have kids.... So what to do with women? I know a lot of employers who don't want to hire women they expect to get pregnant within the near future. Nobody can force them to and I would do the same ;)

It was explained to me once by a PO member and employer that he would like to see the labour code reformed so that it offers less protection to employees (some provisions are beyond ridiculous, especially when it comes to trade union rights) - but in return, employers would be obliged to use umowa o prace for any fully directed work. It makes sense, I think. The problem is that the trade unions will scream and howl as soon as any reform to the kodeks pracy is discussed - so you end up with the situation that umowa zlecenie / umowa o dzieło are used because no-one wants to work together for a common goal.


It's a huge question, to be honest. I know one employer (who is a great guy, and very fair to his employees, including giving them extra days off over the "long weekends" so they don't have to use their holidays) who is very open about it - he said that the abuse by pregnant women and young mothers is so huge that he simply won't hire any women between 25-40 as a result. Part of the problem is certainly the macho role played by Polish men - "My job is more important than your job and so you need to stay at home when the kid is sick" - which to me is complete ********.

Certainly, one obligation should be for the male to either take 6 months paternity leave or it's completely lost - the current situation with women getting almost 2 years as a result of abusing sick leave and then a year of maternity leave is causing immense problems for young women in Poland.

@Delph: "less protection" to employees! Why not slavery? It would be best for those employers;). I bet neither that employer nor anyone in his family have ever worked under garbage contracts. I "love" the "it's good for you but it isn't good for me" attitude.

Why not having Poles work for a plate of rice like in Asia?

Easy to talk when not concerned! ;)

Au contraire InPolska - I would say a great many bosses in Poland work with zero or very small protection. I could be fired tomorrow with no reason and no compensation, escorted out by a security guard, leave my car keys and phone on the desk and told to fend for myself. I accept that as the flip side of good pay and interesting work and I plan my finances accordingly. I know many people with the same arrangements.

At the bottom end of the scale consider this - you are about to launch a new project and need 3-4 people. Its got a 60% chance of working. If it does not then if you have people on less formal contracts then you could send them off with a thank you note and a good reference and they would have some valuable experience, be able to improve their language etc. That seems mutually beneficial and not exploitation.

I also do a lot of work in France, really the least flexible labor market I have ever encountered and it is a massive decision there whether to hire someone.

Well, what I mean is that some of the more insane provisions (such as the trade union "inspector" being untouchable in work) should be abolished. Of course, the more normal protections should be kept - but for instance, employers should be allowed to inspect whether or not someone is genuinely sick. If Agnieszka is seen in the shopping centre trying on new dresses when she's on sick leave (when pregnant) - then the employer (rather than ZUS) should be allowed to instantly dismiss her for gross misconduct.

I don't think anyone minds that a woman should be able to return to work to the same job and the same conditions, but I do understand why employers get incredibly angry when someone sees two lines on the test and immediately runs off for sick leave.


Out of curiosity, was it your choice to work in such a way?


Yes, a friend works in this way. He makes it clear from the beginning that the project is new and won't necessarily succeed, but he agrees set goals with the entire team at the beginning. If they meet the goals (and the project succeeds) - then they are given full contracts without time limits as the project is now self financing. It seems to work well.

@CMS: what personal experience do you have with so called garbage contracts?

for the past few years, around 75% of my income come from garbage contracts. I must admit I make "great" money but to do so, I have to work like a slave (up to 12 hours a day most of the year, max. 2 weeks' vacation per year) and I'd better not be sick;). 6 years ago, I was operated of a (thyroid) cancer and I did take only 10 days off (including the 4 days at the hospital). Fortunately I'll have a foreign retirement but since I have not worked very long (but had a good salary), I could expect maximum 1,000/1,100 euros/month because in Poland I'll get nothing...

You know, life is rough for the "little guy". Not everybody can be a big tycoon full of gold and money! ;)

There are a lot of Poles on garbage contracts who don't make more than 2,000/2,5000 ZL (I know some) and I feel very sorry for thme.

It would be good to read from those Poles on garbage contracts and who are paid peanuts. It would be a different speech ,).

A few months ago, I read about a (Polish) girl (in GW) who was pregnant and alone (I know, it happens ;)) and who worked on umowa o dzieło. That girl had a lot of health problems related to her pregnancy but she could not afford to stay home.

Examples of such kind go by the thousand.

And what about all those young ones who cannot start families, buy flats because they don't have umowa o pracy.

These are the REAL problems.

Yes when I graduated college in 92 there was not a lot of work around so I worked on short term contracts and on a per hour basis at fast food restaurants - Waffle House, KFC and in a warehouse. I did that for about 9 months before I found a more secure job. Financially it was very tough especially as I had debts from college; but I did accounting classes 2x a week and also had time for some other life skills - learned to type, learned german. Was not ideal but I actually look back on it as a good time in my life.

I think "garbage contracts" aimed at young people are fine. Aimed at people in mid life and with kids maybe not so much.

Delph in answer to your question - yes that was my choice and made clear to me at the time I took the role but I think its the same for many senior finance people - if you screw up they want you out, not hanging round for 3 months with access to the bank accounts.

@CMS: Obviously, you don't know about Poland if you think garbage contracts are only for "toilet cleaners". I also work with foreign companies and some of them hire (engineers, sellers...) only on garbage contracts.

I also personally know several Poles with Master's Degrees or even more who work in Government institutions Under garbage contracts.

Garbage contracts are not for young people but for EVERYBODY.

@CMS; get informed about Poland instead of talking about what you don't know about.

(as far as I'm concerned, I have a Master's Degree from the US)

Personally I spent more than a decade working on umowa o dzieło. For me then it was by far the best choice and saved me a bundle of cash.

These days I have my own company and work exclusively for myself.

Yep - I was shocked when one of my students flagged that this is her aim in the nearest future. She works for an institution and apparently will get 100% of her salary paid in full for that time.

Can that be true?

It can be true and all too often is true. With careful timing of two children and a friendly doctor, it's perfectly possible for a woman to take five years off on full salary. That's one of the reasons ZUS is so stupidly high.

Not quite. She'll get 80% for the year of maternity leave and 100% for the sick leave (up to half a year...) as far as I know. ZUS pays for it, which might explain a lot... ;)

But this is actually the biggest problem for women - so many have used and abused pregnancy that no employer would take a female on umowa o prace between the age of 25-40. ZUS apparently does conduct controls, but they're obviously not strong enough. In my view, the employer should be entitled to conduct their own checks - if someone is genuinely on sick leave during pregnancy, they certainly shouldn't be in shopping centres!

@Harry: I had my own company (in fact still do officially) but not using it because I think ZUS payment is too much . I'm satisfied with my income, my flexible schedule but I do know that I cannot afford to miss work because I'm sick (I had cancer surgery and was out of work for only 10 days but I would not recommend it to anyone ;)). Next month, I have to go to hospital for a control and shall stay there 1 week (I won't pay since I have ZUS/NFZ pursuant to my husband's death) during which I shall make no income. I can manage financially but what about those who cannot? I won't have retirement from working this way but furtunately I'll have a (decent by Polish standards) foreign retirement otherwise what? If I were younger, of course I wouldn't accept this and move abroad.

When I see my situation, I'm glad to say it's ok (at least financially) but I look at the whole situation and not to only at my little person. There are 3.5 million Poles working under such sh###t contracts and very often it's hell for them.

I'm not selfish. I consider the general interest before my little self.

PS: contrary to what CMS believes: garbage contracts are not for special jobs and special age groups since they concern everybody.

Yes, it is a huge problem now. Logical would be to allow people to opt-out of pension payments, but then again, who will pay for the millions that took early retirement?

@Delph: NFZ pays 80% of salary (when umowa o pracy, of course ;)) and not 100%. As to education leave, it can be for how many years? 2, 3, 5? but it is not paid.

Of course it is a problem for women but what to do? Authorities and economists complain the birth rate is too low but if women are not helped, they won't have many kids...

What to do? ;)

@Delphi: according to what I hear it's now ... 900, is it, regardless of income? In the summer, I don't work much and it would bother me to pay 900 ;). ZUS should be a % of the earnings

AS before Harry - I do not, and will not, EVER pay another SINGLE zloty to the "company" known as "ZUS". I am covered RE: the health service by being employed by my wife, and others can work legally for an "organisation" for a 400 zloty monthly fee. I humbly suggest the rest of the country's self employed follow my lead, if they care about ******* up the system and forcing change.


Ah.....

Let immigrants in?


(ZUS for self employed...) 1,300.............. at the last count, when I said goodbye to the jokers.


Cimoszewicz said the same in a BBC "HardTalk programme" interview in 1999...promising that the SLD government recognised the problem, and that ZUS payments were excessive and that "restructurisation", cliched as the word was, was a priority. And words they were.......

It baffles me why the self employed continue to pay and don't revolt.

@Doug: 1,300!!! it's well over the 900 that I thought. It does not make any sense and thus many work under the table. Besides being too high, it does not make any sense as it should be a % of what the socalled business makes.

Yes, of course. But the number of people it affects are so small in the scheme of things they just put up and pay up - thinking they are helpless.

In the UK there would be mass disobedience and rightly so.