BANKRUPTCY POLISH TRANSPORT SECTOR

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On Thursday June 12th 2014 the Polish supreme court defined its final judgement with regards to night allowances for Polish drivers. The outcome of the verdict  has received a common description as ‘’lethal for all Polish transport companies’’ in the Polish media. Moreover it will result in risk assessments for each Polish transport companies and possibly it will result in a large amount of bankruptcy requests.

Taken its importance, the court case was attended by many spectators, such as owners of transport companies (Polish and foreign), lawyers, journalists etc. As a complete surprise to all attendees, the Polish supreme court agreed upon their unanimous judgement that truck cabins can’t be regarded as acceptable substitutes for accommodations for drivers. As a consequence drivers are either entitled to receive reimbursement of the cost for hotel accommodations proved with hotel bills. In such cases the driver will no longer be entitled for night (net) allowances. Or the employer has to pay drivers 25% of the night allowance  additional to their regular per diem structure (even if the night is spent in the truck cabin). The night allowance varies per country, for instance it results in an additional € 37.5 per night for Germany and an additional € 45 per night for France.

The supreme court decided that each individual driver is entitled to receive this additional (net) payment for each night the driver has spent in his cabin. In practice it means that the employees can bring an action against employer for not paid night allowance for the past 3 years, if no such payments were made. In the Polish newspapers the consequences of this verdict have been described as the ‘’bankruptcy of the Polish transport companies’’.

Indeed such a  dark and terrifying scenario seems to be quite realistic. In theory Polish transport companies could opt to pay this additional remuneration to each driver. For many truck companies this will result in severe additional cost, which they can (or will) not comply. In those cases requesting a bankruptcy for their Polish transport company seems to be a more reasonable road map. After the bankruptcy, such organisations could either decide to establish their new transport companies in other Central and Eastern European countries, or again in Poland. In case they decide for the latter solution, this will lead to a renewed (net) payment structure and most likely to higher labour cost.

The verdict of the supreme court can’t be revoked. The only possibility is to  initiate an appeal against the Polish state in Strassbourg, a road map that seems to be far behind the reach of transport companies. In two weeks from now the total rationale of the verdict will be published officially, and more details will follow. Regardless the precise description, its impact will indeed be bad for the entire Polish transport sector and Poland’s ambition to become a major transport hub in the European Union.

Although this verdict of the Polish supreme court issued in relation to a specific case,  it has consequences for each Polish transport company. However its impact will differ per organisation, mainly depending on how its per diem payments have been structured until now. We strongly recommend to assess the risks of your individual transport companies.