Terminating a Manager in Poland: Legal Risks, Procedures, and Severance Negotiations

Terminating a Manager in Poland: Legal Risks, Procedures, and Severance Negotiations

Termination of a manager in Poland means ending the individual’s relationship with the company, either as an employee (employment contract) or as a corporate officer (management board appointment). The legal route, timing, and risk profile depend on which legal “hat” the manager wears – and many executives hold both roles at the same time.

This is informational material, not legal advice. The correct approach depends on the factual situation, including the manager’s contract, functions, group structure, and the internal governance documents.

Why terminating managers in Poland is legally sensitive

Managerial exits often trigger multi-layer risks: employment protection claims, corporate governance challenges, confidential information exposure, and reputational fallout. Poorly structured terminations may result in reinstatement claims (for employees), damages, invalid corporate resolutions, or disputes over non-compete and IP.

For international groups, additional friction points include mismatched expectations between headquarters’ practices and Polish mandatory rules, especially around notice, justification, and protected categories.

Step 1: Identify the legal basis of the manager’s relationship

In Poland, “manager” is not one uniform legal category. The most common scenarios are:

• Employment contract governed by the Labour Code – typically for operational managers and sometimes for board members.
• Management contract / services agreement (civil law) governed by the Civil Code – common for executives paid on performance.
• Corporate appointment as a management board member under the Commercial Companies Code – a corporate mandate, separate from any contract.

Each basis requires a different termination mechanism and different documentation. A common compliance failure is removing a board member by resolution but leaving the employment contract untouched (or vice versa), which keeps payroll, benefits, and litigation exposure alive.

Step 2: Corporate procedure – removal of a management board member

For companies such as sp. z o.o. (limited liability company) and S.A. (joint-stock company), removal from the management board is generally performed by a shareholders’ resolution (sp. z o.o.) or by the supervisory board (S.A.), unless the company’s statutes provide otherwise. The key corporate risks are:

• Incorrect authority – the wrong body adopts the resolution.
• Defective convocation or voting – formal flaws open the door to challenges.
• Mismatch with articles of association / statutes – internal rules may impose additional steps.

Under Polish law, appointment and dismissal are governed by the Commercial Companies Code [1]. Registration updates in the National Court Register (KRS) should be filed without undue delay for third-party transparency (the entry is generally declaratory, not constitutive, as to the dismissal itself).

Step 3: Employment-law procedure – terminating an employment contract

If the manager is an employee, the Labour Code framework applies. Termination may occur by mutual agreement, with notice, or without notice (disciplinary). The most litigation-prone area is termination with notice of an indefinite-term employment contract, where the employer must provide a concrete, true, and specific reason.

Key legal requirements and risk points under the Labour Code [2] include:

• Written form and proper delivery.
• Consultation with a trade union if applicable (union representation can exist even for managers).
• Accurate reasoning for indefinite-term contracts – vague “loss of trust” without factual grounds is frequently challenged.
• Protected employees – certain protections may apply (e.g., pregnancy, pre-retirement protection), depending on conditions.

When the factual basis involves performance, documentation quality becomes decisive: KPIs, evaluation records, warnings, and evidence of support measures. When the basis involves misconduct, evidence handling should anticipate future court scrutiny and data protection constraints.

Three common “exceptions” that change the risk assessment

The following exceptions frequently alter the recommended termination path and negotiation posture:

• Exception 1 – the manager holds a dual role (board appointment plus employment contract or management contract). Removal from the board does not automatically end the contract, and contract termination does not automatically remove board powers.
• Exception 2 – the manager is under statutory protection (for example, pregnancy or pre-retirement protection), which may restrict termination under the Labour Code depending on conditions and documentation.
• Exception 3 – the termination is linked to an internal investigation (fraud, conflict of interest, AML or corruption concerns). Evidence preservation, whistleblowing handling, and communications strategy may become as important as the termination letter itself.

Severance negotiations – what is mandatory vs. contractual

In many manager exits, severance is primarily a negotiated risk-management tool rather than a statutory entitlement. Statutory severance may apply in redundancies for reasons not attributable to the employee (including certain individual terminations) where the employer falls within the scope and thresholds of the Act on Collective Redundancies [3]. Outside that framework, severance typically arises from:

• an employment contract or management contract clause,
• a company policy,
• an exit settlement agreement.

Settlement structures often bundle: release of claims, handover obligations, confirmation of return of property, confidentiality, non-disparagement, and non-compete. In Poland, post-termination non-compete for employees requires compensation under the Labour Code [2]. Under civil-law contracts, non-compete enforceability and (if any) compensation are contractual and must be assessed case-by-case under the Civil Code [4] (and general principles such as freedom of contract and limits of lawful restraint of trade).

Practical sequencing to reduce disruption

A business-oriented exit plan typically aligns legal steps with operational continuity:

1. Governance check – confirm who can dismiss and who can sign termination/settlement documents.
2. Evidence and documentation review – especially for performance/misconduct grounds.
3. IT and access plan – lawful access removal, data security, preservation of evidence.
4. Corporate resolutions and filings – avoid a “ghost board member” in KRS.
5. Negotiation package – align severance, releases, and restrictive covenants with business risk.
6. Communications – internal and external messaging should be accurate and proportionate to mitigate defamation and reputation claims.

Litigation, reputation, and white-collar angles

When terminations follow alleged misconduct, companies should separate verified facts from internal suspicions. Overstated accusations in letters or announcements can fuel defamation disputes and increase settlement cost. Where misconduct may constitute an economic crime, parallel tracks may appear: internal disciplinary measures, civil claims, and criminal notifications. Each track has different evidentiary standards and timeline implications.

Lawyersinpoland.com by Kopeć & Zaborowski supports international businesses in designing legally sound termination strategies; to review a specific managerial exit scenario and documentation, contact us.

FAQ – Terminating a Manager in Poland: Legal Risks, Procedures, and Severance Negotiations

1) Can a company dismiss a management board member at any time?

Generally yes, by the competent corporate body under the Commercial Companies Code, but the articles of association / statutes and proper procedure matter. Dismissal from the board does not automatically terminate any separate contract.

2) Is a reason required to terminate a manager in Poland?

For removal from a board appointment, the Commercial Companies Code generally does not require stating a reason in the resolution (practice varies). For terminating an indefinite-term employment contract with notice, the Labour Code requires a real and specific reason.

3) What is the biggest risk when the manager has both a board role and an employment contract?

The biggest risk is ending only one relationship. The individual may lose board authority but remain an employee entitled to salary, access disputes, and potential court claims.

4) When is severance mandatory in Poland?

Statutory severance may apply in redundancies for reasons not attributable to the employee under the Act on Collective Redundancies, provided the employer and the termination meet statutory scope and conditions. Many executive severance packages are contractual or negotiated.

5) Can the company impose a post-termination non-compete on a manager?

For employees, a post-termination non-compete requires a written agreement and compensation under the Labour Code. For civil-law management contracts, enforceability depends on contract drafting and Civil Code principles.

6) Should misconduct be described in termination documents?

If termination relies on misconduct, the description should be factual, specific, and provable. Overstatements can increase exposure to labor disputes and reputation claims; the scope should match the evidence.

Bibliography

[1] Act of 15 September 2000 – Commercial Companies Code (Kodeks spółek handlowych).

[2] Act of 26 June 1974 – Labour Code (Kodeks pracy).

[3] Act of 13 March 2003 on special rules for terminating employment relationships with employees for reasons not attributable to employees (collective redundancies).

[4] Act of 23 April 1964 – Civil Code (Kodeks cywilny).