Nawrocki Signs Gender Balance Bill While Referring It to the Constitutional Tribunal

President Karol Nawrocki has signed legislation improving gender balance in public companies while simultaneously referring the measure to the Constitutional Tribunal for subsequent review.

The President’s Decision

The Chancellery of the President announced that Karol Nawrocki signed the law due to the values stemming from Article 33 of the Constitution of the Republic of Poland, which guarantees equality between women and men. An additional argument for signing the law was the pursuit of limiting inequalities in the labor market faced by women.

The Chancellery added that the president considered the act to contain serious legislative errors and therefore will refer it to the Constitutional Tribunal. In his assessment, the provisions may violate the freedom of economic activity and the principle of proportionality, while also potentially weakening the competitiveness of enterprises.

The announcement noted that the act disproportionately restricts the freedom of economic activity by interfering with the organizational autonomy of public companies and imposes extensive administrative and bureaucratic obligations on them.

Constitutional Tribunal Review

According to the president, it is justified for the Constitutional Tribunal to examine whether the realization of the goal to increase equal opportunities came at the expense of the constitutionally protected freedom of economic activity, and whether the legislator maintained a proper balance between the public interest and the protection of entrepreneurs’ rights.

The law aims to ensure gender balance in the governing bodies of listed companies, including State Treasury companies, implementing the EU directive on improving the gender balance among directors of listed companies into the Polish legal order. EU regulations apply to both women and men and are intended to streamline the application of the principle of equal opportunities in managerial positions.

Its regulations apply to listed companies headquartered in Poland with at least one share traded on a regulated market in an EU member state, while micro, small, and medium-sized enterprises are exempt. The amendment introduces definitions of company bodies, such as the management board and supervisory board, and of the underrepresented gender as those holding no more than 49 percent of total positions in the bodies.

Key Assumptions of the Signed Act

The act assumes that in the management or supervisory boards of public companies, the underrepresented gender is to constitute a number closest to 33 percent of all positions in the company’s bodies, but no more than 49 percent.

Under the amendment, general meetings of companies will be obligated to adopt a resolution on gender balance policy, which must define candidate selection rules, career development programs, and human resource management strategy. This policy is to be made available on the company’s website, and potential violations may be investigated by the Polish Financial Supervision Authority (KNF).

Simultaneously, recruitment processes must apply non-discriminatory, neutrally formulated, and unambiguous selection criteria that take candidate qualifications and gender balance needs into account, defined prior to recruitment. The act also states that when choosing between candidates with equivalent qualifications, priority is given to the underrepresented gender unless other non-discriminatory diversity rules specified in legal provisions apply to the contrary.

Candidates whose recruitment rights were violated by the company will have the right to compensation of no less than the minimum wage for work.

If companies fail to perform or improperly perform information and reporting obligations under the new regulations, the Polish Financial Supervision Authority may issue recommendations for minor violations or impose a fine of up to PLN 500,000 for gross violations.

The law enters into force 14 days after the day of publication.