The choice between an employment contract and a civil-law contract for services (umowa zlecenia) is one of the key decisions when establishing a working relationship. It affects costs, employee rights and legal risk on the employer's side. It's worth understanding the differences before you sign.
How these contracts differ
An employment contract is governed by the Labour Code and guarantees the employee a range of rights: annual leave, protection against dismissal, minimum wage, working-time records and overtime pay. A contract for services is a civil-law contract governed by the Civil Code – the contractor does not enjoy employment law protection, though they are entitled to a minimum hourly rate and some ZUS insurance coverage.
Cost differences
A contract for services is generally cheaper for the contracting party – there is no obligation to pay for leave, overtime or to apply dismissal protection. When insurance entitlements overlap (the contractor also has an employment contract), the obligation to pay contributions may be limited, making the civil-law contract even cheaper. The cost difference can range from a few to several tens of percent compared with an employment contract.
When a contract for services is lawful
A contract for services is the appropriate form of cooperation when the work does not have the characteristics of an employment relationship: it is not performed under the direction and supervision of the contracting party, at a place and time set by them, personally and on a continuous basis. A civil-law contract works well, for example, for one-off, casual or project-based work, or where the contractor has real freedom in organising their work.
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When a penalty is at risk – the fictitious civil-law contract
PIP and ZUS verify whether civil-law contracts are in reality employment relationships. If an inspector finds that work was performed as under an employment contract (fixed hours, one location, instructions from a superior), they may order the contract to be reclassified – with the consequence of paying back ZUS contributions for the entire period, including interest.
Differences in records and documentation
- Employment contract: obligation to keep personnel files, working-time and leave records
- Contract for services: record of hours worked (obligation since 2017), payslip or invoice
- Both forms: ZUS registration (ZUA or ZZA), monthly contribution reports
How I can help
I help match the right form of employment to the nature of the collaboration and prepare the correct documentation – both for employment contracts and civil-law contracts. If you have doubts about existing contracts in your company, I can review them and identify the risks.