Labour leasing in Poland benefits both workers and companies

An interview with the CEO of Gremi Personal on hubs.ua

Original in Ukrainian: hubs.ua

Can you make money on outstaffing?

About the path a Ukrainian must take to build a successful business in Poland with an annual turnover of several tens of millions of dollars, what the outstaffing (labour leasing) market is and how to make money on it, what the dangers of illegal work in Poland are, and which employment options are most advantageous for workers – on these and other equally interesting topics, Hubs spoke with an entrepreneur of Ukrainian origin, the founder and owner of Poland's largest agency for the international employment of Ukrainians, Gremi Personal – Evgenij Kirichenko.

— Mr Kirichenko, in an interview with Yevhen Cherniak for the Big Money project, you confirmed that your agency Gremi Personal has an annual turnover of about 25 million dollars. How many people work in the company, and did you take out loans to have start-up capital?

— We have our headquarters in Gdańsk and 11 regional offices across Poland. We employ about a hundred office workers, and in total there are now 1,460 workers under our operational management, 95% of whom are Ukrainians. This business started 10 years ago. To get going, we used only our own financial resources. We did not take out loans. By the way, I believe that when starting out in the services market, a loan to start a business is a great evil. Of course, when it comes to the manufacturing market, that is a different matter.

— Where did the idea of taking up outstaffing come from, and how did this business begin?

— 10 years ago, together with my father, I came to Gdańsk for the first time to build my shipyard. My father was professionally engaged in shipbuilding in Kherson. We started with small orders, small ship sections and blocks. Then we gradually grew, hired more people, engineers. Our goal was to build our own shipyard in the future. We began taking large orders and, to fulfil them, rented space at several enterprises at once. But at some point I concluded that manufacturing was not my area of business, that I preferred working with people.

I persuaded my father to close the shipbuilding business and move into the services sector. That is how I gave up the manufacturing industry and had to start practically from scratch. Within just six months, our labour leasing company was working with almost all the shipyards in Gdańsk and Gdynia; I hired welders, fitters and engineers. All of them were Ukrainians, mostly from Kherson and Mykolaiv, because that is where the workers with the qualifications needed in the shipbuilding industry were.

Then we began to expand the "geography" of workers, because we took up other specialities and markets. In 5 years in the construction and repair of ships I achieved a lot. But the next 5 years in the services and employment sector took me to a completely different level of business.

— Do you regret such a radical change of industry?

— No, because the pace of the company's development and of my self-realisation in it fully satisfy me. The decision I made still reminds me of the most important thing: if I do something, that activity must give me pleasure. People come to me with big projects, offer to build houses, invest in start-ups, but I immediately say "no". I deal only with employment services. I focus on what I do and what I enjoy. This brings me moral and financial dividends.

— In the average person's view, international employment is handled by an ordinary employment agency. You work on the principle of labour leasing, or outstaffing. Why is this more advantageous for companies than directly recruiting workers?

— One of the main advantages is that a company or enterprise can invite workers only for the period of a specific task, project, or during production peaks. Besides, the burden on accounting and HR is reduced, because there are no costs associated with calculating salaries and maintaining personnel records. One should also not forget that a condition for the legal employment of a foreigner in Poland is obtaining a permit, which takes time to arrange.

The risk of paying compensation in the event of the elimination of jobs also disappears. There is no downtime due to a worker's illness or leave. There really are many advantages. You can react quickly to the seasonal nature of the business – that is, depending on the season, increase or reduce production capacity, open representative offices, new production lines or regional branches, leasing all the workers needed for this.

We are professionals in our field. Experience has helped us perfect all our processes. This allows us to reduce operating costs. An enterprise with no experience in recruiting and handling foreign workers needs far more resources than we do. That is why outstaffing gives them many benefits.

— And how advantageous is it for the Ukrainian workers themselves to work for you rather than, say, directly for a Polish company? Does it affect their pay, do you make deductions from their earnings?

— The fee is paid to us by the enterprise that orders workers from us. The hired workers pay us nothing. In most cases, it is the companies that decide what net salary a worker should receive, and further calculations are based on that. For our part, we always strive for the highest, market-level rates, because this is advantageous for workers, and it is then easier for us to find good staff earning competitive pay.

A key advantage of working with our company is the guarantee that workers receive their earned money in full and on the set date, 100%. Enterprises have repeatedly delayed payments, and there were cases where they did not pay at all. But we, for our part, settled all debts to the workers! This is our responsibility and our reputation on the market, and we value it greatly. For such exceptional cases we even have a credit line open at the bank.

Secondly, we take on all the legal aspects of employment, arrange permits for legal work and visas, all the documents necessary to work in Poland. If a worker does not want to go through all these procedures and prefers to work illegally, they are not our client.

By the way, many Polish companies do not want to deal with such legal matters, because it is troublesome and involves a lot of bureaucracy. So they either decide to do it only for highly qualified workers, or prefer to obtain staff through companies like ours.

Thirdly, we provide our workers with a social package: health insurance, accommodation and the support of a coordinator and company staff who speak Russian and Ukrainian.

— All right, if everything is so convenient and transparent in labour leasing, then what forces a fairly large number of Ukrainians to work illegally in Poland? If the Polish media are to be believed, of the roughly 2 million Ukrainians working in Poland, almost half are illegal workers!

— First, let's clarify the number of illegal workers. These are only private assumptions and conclusions voiced in the Polish and Ukrainian media by politicians or journalists. There are no official and reliable statistics on illegal workers. Therefore, one may assume that a million is a rather exaggerated figure with some political subtext.

On the other hand, illegal employment is still fairly common. There are two main reasons. The first is the workers themselves, or rather their careless attitude to work. They often obtain a work permit for one company but start working for another, or for several at once, in order to earn more. We have had such cases too. Or they consider it an unnecessary formality altogether and come to Poland on the basis of a biometric passport under visa-free travel and, without the appropriate documents, go to work the next day.

The consequence is that for illegal work a worker can be deported and banned from entering Poland and the EU even "retroactively", while already in Ukraine. Documents are checked taking into account at least the last 6 months, and any violations are entered into the database.

There are official figures: over 6 months of 2019, more than 8,200 Ukrainians were caught breaking the law and deported, with a ban on entering EU territory ranging from 6 months to 2 years!

The second reason is some Polish employers. This is a frequent phenomenon, especially in agriculture and small firms. To save on taxes and health insurance, they do not arrange the appropriate documents for workers. Meanwhile, the fine for employers is between 3 and 30 thousand zlotys for employing illegal workers. For some "small firms", however, this fine is more advantageous than legal employment. And the stories of workers being "thrown out onto the street or driven into the forest and left to die when they needed medical help" are precisely tales about illegal workers.

Those who decide to work illegally must be aware that in such cases it is always the workers who suffer most, while companies lose the least.

Nikolai Gordiychuk