An employer is prohibited from paying remuneration to an employee whom it has employed after being included on the sanctions list. However, the mere fact of being included on the list cannot be grounds for terminating the contract with such a person.
Pursuant to the Act of 13 April 2022 on Special Measures to Counteract Support for the Aggression Against Ukraine and to Protect National Security, on the basis of selected legal instruments contained in Council Regulation (EC) No. 765/2006 of 18 May 2006 concerning restrictive measures in view of the situation in Belarus and the involvement of Belarus in the Russian aggression against Ukraine and Council Regulation (EU) No. 269/2014 of 17 March 2014 concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine, a list of entities has been established to which the sanctions set out in the above Act apply. One of the sanctions includes the freezing of all funds and economic resources and the prohibition on making them available to an entity included on the sanctions list. The inclusion of an entity on the sanctions list may therefore have repercussions in terms of labour law relations.
If the sanction applies to an entity with employees in Poland, its application may threaten the timeliness of payment of salaries and other employee benefits that are a source of livelihood for employees and their families.
An employee or an applicant for employment may also be included on the sanctions list. In such cases, the following questions arise: (i) should the employer withhold remuneration from such an employee (i.e. comply with the prohibition on making any funds available to him/her); and (ii) should the employer refuse to employ an applicant for employment simply because he/she is on a sanctions list?
Importantly, Polish and EU sanctions involving a prohibition on making assets available do not prohibit the employment of sanctioned individuals, and in particular they do not mandate the termination of the employment relationship with such a sanctioned employee.
For more details, please see the full article, which is available here.
Agnieszka Lechman-Filipiak, Partner
Emilia Kalecka, Assosiate