Last week the government accepted the changes drafted by the Ministry of Finance to the Act on Public Funds and some other acts. To improve the financial condition of the state, the government revisits the idea to suspend the right to retirement benefit for those who continue to work at the employers’ they had been working so far despite the fact that they acquired the right to retirement benefit. The retirement benefit will not be suspended if an employee terminates the employment contract with the employer for whom he/she has been working so far and then enters into another employment relation even if that employment relation were to be with the employer for whom the employee has been working so far.

The above solution is to make it easier for employers to terminate employment contracts with retired persons in order to “vacate” positions for young-generation employees. If the draft is approved by the Parliament and signed by the President, the new provisions will come into force on October 1, 2011.

Contact person: Lech Gniady, lg@pnplaw.pl