The Making of a Precarious Workforce

When Poland entered the 1990s, flexibility was the word of the decade. Western advisors, domestic reformers, and international institutions agreed: a modern market economy required a labour market that could move—hire fast, fire fast, adjust to the rhythms of global capital. The socialist employment system, built around the state enterprise and the permanent contract, had to go. What replaced it was framed as a transitional arrangement: a necessary roughness on the road to convergence with Western Europe.

Three decades later, that transition never ended. In 2014, approximately 27 percent of Polish employees were employed on fixed-term contracts, more than in any other European country. Nearly three-quarters of those were involuntary, contrary to the claims of neoliberal commentators. At its peak Poland held the highest share of temporary workers among all EU member states. These are not the numbers of a country passing through a phase. They are the numbers of a country that built precarity into its economic model.

This article argues that labor market dualization in Poland should be understood not as an unintended byproduct of economic transformation, but as the cumulative result of institutional choices: the selective liberalization of employment law, the strategic use of civil law contracts to reduce labor costs, and the gradual incorporation of trade unions into dialogue structures that prioritized social stability over structural reform. Precarity, in other words, was not something that magically happened to Poland’s labor market, but was built into it. The following sections trace that construction from the shock of early transition through the legal architecture of flexible employment, to the political compromises that allowed segmentation to become the new normal.

The Transformation Context: Shock Therapy and the Dismantling of Socialist Employment

Understanding the roots of Poland’s precarious labor market requires going back to 1989—and further still. Full-employment policy was the main pillar of the socialist welfare system. The majority of provisions—housing, healthcare, recreation—were available to employees via state-owned enterprises. The Labour Code, enacted in 1974, reflected this logic: it assumed stable, indefinite employment as the norm, with the state enterprise as both employer and welfare provider. Work was not just an economic arrangement; it was the organizational spine of social life.

The transition dismantled the spine rapidly. The beginning of the socio-economic transition in 1989 effectively ended the social security provided by the full employment policy. The beginning of the socio-economic transition in 1989 effectively ended the social security provided by the full-employment policy. Because of weak labor productivity and misallocation of human resources, it was impossible to maintain the full-employment principle. The scale of the shock was staggering: registered unemployment increased from 6.5 percent in 1990 to 16.4 percent in 1993, and continued rising to nearly 20 percent by 2002–2003.

What is striking, in retrospect, is not simply the scale of the disruption but its ideological framing. The Balcerowicz Plan, Poland’s version of shock therapy, was not merely an economic program. It was more of a discursive project. Stanisław Gomułka, an economist from the London School of Economics and a key advisor to Leszek Balcerowicz, wrote in The Guardian in August 1989 that Poland needs unemployment to create competitive labor markets to produce greater mobility, discipline and the control of wage inflation. Unemployment, in this reading, was not a crisis to be averted but an instrument of modernization.

This framing had lasting consequences. Labor policies were formulated reactively, in response to new challenges posed by mass-scale unemployment, and became part of a largely successful strategy of pacifying social and political mobilization. Rather than constructing a coherent new employment model, post-transformation governments operated in emergency mode, patching over institutional gaps. What is worth mentioning, the Labour Code of 1974 was never replaced. It was left standing while an entirely parallel structure of non-standard employment grew up alongside it. That lasts to this day.

The Legal Architecture of Precarity

The vehicle for this parallel structure was the civil law contract. Polish labor law distinguishes sharply between employment contracts (pol. umowa o pracę), which fall under the Labour Code and carry full protections: paid leave, dismissal rights, social insurance, regulated working time. On the other hand Civil Code introduces civil law contracts, which carry almost none of these protections. The two main civil law forms are the contract for mandate (pol. umowa zlecenia) and the contract for a specific task (pol. umowa o dzieło).

From the legal point of view, the basis for such a wide use of civil law contracts for structuring work relations was a very imprecise boundary between employment and non-employment forms of work. There is no presumption of the existence of an employment relationship under Polish law. This ambiguity was not accidental. The boundaries were unclear: neither the labor law doctrine nor the jurisprudence determined precisely when it was permitted to conclude a civil law contract and when a labour code contract was required. This situation has been structurally productive for employers.

Into this legal grey zone, employers moved decisively. An important reason behind the rise of civil law employment was the increase in minimum wages combined with a high tax wedge for low-wage labour code employees. Between 2007 and 2014 minimum wages were increased relatively fast, which incentivised employers to fire low-wage labour code employees and offer them civil law contracts with lower taxation. What needs to be highlighted is that the arrangement was often attractive to workers too, but only in the short term: higher take-home pay in exchange for sacrificed protections.

The public sector played an underappreciated role in this dynamic. Public agencies started to outsource a significant part of public tasks as a result of austerity policies that froze the remuneration fund. This took the shape of both subcontracting, as well as employing persons under civil law contracts directly by public administration. The number of such persons increased from about 20,000 in 2010 to almost 45,000 in 2016. When the state itself became a user of junk contracts, the normative signal got clear: precarious employment was not some sort of deviation from the system, but a new norm.

The scale of the phenomenon is documented in multiple data sources. Available data and estimates show a significant increase in the number of people working on civil law contracts until 2013/2014, reaching approximately 1.4 million persons by some estimates. After 2014, there is a certain stabilisation, but the phenomenon still affects about one million persons. A significant share of these contracts were concluded in conditions that legally required a standard employment contract—the Ministry of Finance estimated this at several hundred thousand cases per year.

The consequences for workers were systematic and severe. The replacement of labour code contracts by civil law contracts meant limiting access to a number of protection mechanisms: such employees were covered by mandatory social insurance to a limited extent, were not protected against dismissal, had no guaranteed right to leave, and were not subject to restrictions on working time and minimum rest periods. Workers on civil law contracts also had limited access to labor tribunals, and (up until 2019) had no right to join or form trade unions.

Trade Unions and the Politics of Compromise

Poland’s labor history presents a deep paradox. The country that gave birth to NSZZ “Solidarność”, the largest independent trade union movement in the communist bloc, with ten million members at its peak, now has one of the lowest union density rates in Europe with the majority of unions operating mainly in state-owned branches of the economy.

The collapse of union power was not simply a market outcome. It was shaped by specific political choices, including choices made by the unions themselves. Between 1997 and 2001, Akcja Wyborcza Solidarność (Solidarity Electoral Action) was a major parliamentary force supporting reforms liberalizing the labour code and weakening the PAYG pension scheme. To put it bluntly, the union that had once demanded workers’ rights became a vehicle for dismantling them.

The broader pattern, documented in the strategic documents analyzed by Magdalena Rek-Woźniak and Wojeciech Woźniak, is one of consistent institutional absorption. The directions of labor market reforms were repeatedly legitimized by supra-national bodies’ recommendations. The stress on support for small and medium enterprises, tax cuts, and the reform of the fiscal system aimed at employment promotion was justified by principles agreed at the G-8 summit in 1998 and the European Employment Strategy. Within this technocratic framing, union objections could be dismissed as resistance to modernization.

The concept of flexicurity—imported from Denmark but stripped of its redistributive content—illustrates how accommodation worked discursively. In Polish documents, flexicurity first appeared in the National Action Plan for Employment 2008, where it was operationalized in terms of the improvement of job services and employability of vulnerable groups, mostly through education and training. Questions such as guarantees concerning minimum wages or the realignment of benefits were not even mentioned. Flexibility preserved; security sacrificed.

The institutional result was a social dialogue framework that produced consensus without redistribution. Trade unions negotiated at the margins, securing incremental adjustments while the structural architecture of labor market segmentation remained untouched. Trade unions tried to convince the government to implement legal changes extending the right to associate with non-standardto non-standard workers. After the government had ignored trade unions, the largest confederation OPZZ (Ogólnopolskie Porozumienie Związków Zawodowych) was ultimately forced to file a motion to the Constitutional Tribunal in 2013. The court ruled in their favor in 2015. Implementing legislation arrived only in 2019—a four-year lag that speaks to the depth of institutional resistance.

The Normalization of Precarity: From Transitional Phase to Stable Feature

By the 2010s, the circumstances had shifted. The language of transition—with its implicit promise of eventual normalization—gave way to a different logic: the management of precarity as a permanent condition. This shift is visible in the public policy trajectory analyzed by Karol Muszyński.

When Prime Minister Donald Tusk announced in January 2014 his intention to end the infamous era of junk contracts, to some it seemed like a turning point. The Prime Minister’s promises announced actions aimed at eliminating the phenomenon of the regular use of civil law contracts to shape quasi-employment relations, although the actually undertaken steps were much more modest. What followed was not elimination but normalization: a series of piecemeal reforms that extended selected protections to civil law workers without challenging the existence of the contracts themselves.

Rather than extending the scope of standard employment contracts or universalizing social protections, Polish governments followed a third path: allowing the use of non-standard contracts while consistently extending certain rights specific to labour code contracts to non-standard contracts. This logic was followed by both the liberal-conservative Civic Platform (pol. Platforma Obywatelska) government and the right-wing Law and Justice (pol. Prawo i Sprawiedliwość) government, displaying remarkable policy continuity across the political divide.

The normalization took concrete institutional form. A minimum hourly rate was introduced for mandate contracts in 2016. Social insurance obligations were extended. The right to unionize was eventually granted. Each reform made civil law contracts slightly less exploitative and simultaneously more legitimate. This simultaneously made these contracts an alternative to labour code contracts. Such normalisation is questionable from a normative point of view if we truly believe public policies should promote standard employment.

The demographics of precarity are not neutral either. The burden fell (and continues to do that) disproportionately on young workers, women, and those in the service sector. The in-work poverty rate in Poland reached nearly 10 percent in 2014, and in a dashboard of job quality indicators across 32 classified countries, Poland ranked between the 25th and 30th positions in every dimension: earnings, inequality, unemployment risk, job demands and resources. An entire generation entered the labor market not through the front door of stable employment, but through the back door of the mandate contract. And many never left.

The Political Consequences of a Fragmented Workforce

The making of Poland’s precarious workforce was not an accident of transition, but an outcome of a sustained set of institutional choices: a Labour Code left structurally intact while a parallel world of civil law employment was built around it; a tax architecture that made precarious contracts financially rational for employers and, in the short term, even for workers; a public sector that legitimized the very contracts it should have been regulating; and a social dialogue framework that absorbed union energy without structural concessions.

The political consequences of this fragmentation are only beginning to be understood. There are reasons to believe that due to the life instability introduced by precarious conditions, the increased use of civil law contracts was associated with a certain scale of political radicalisation and delegitimisation of the political order, especially among the younger generation. A workforce divided between insiders on standard contracts and outsiders on civil law arrangements is structurally harder to mobilize collectively and more vulnerable to political appeals that offer identity rather than economic security.

The Polish story seems comparable to the case of the UK under Thatcher’s rule: prolonged economic crisis accompanied by external circumstances and the weakness of internal political opposition opened the window of opportunity for the radical transformation of the policy agenda. What was true of deregulation in Britain in the 1980s proved true of precarization in Poland in the 1990s and 2000s: once embedded in institutions and normalized in discourse, these arrangements become extraordinarily difficult to reverse.

The fragmentation of employment relations did not merely transform the labor market. What’s more crucial to understand is that it reshaped the whole political landscape, weakening collective power, institutionalizing economic insecurity, and creating a generation of workers whose relationship to the state and to solidarity was formed under conditions of permanent precarity. Understanding this is not just a matter of labor economics, but democratic politics.

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The article is based on policy history, legal analysis, and existing scholarship, including works by Rek-Woźniak and Woźniak (2017) and Muszyński (2019), as well as statistical data from Eurostat, OECD, and GUS.

by Gabriela Wilczyńska