Nationwide Crackdown on Illegal Employment in the Construction Industry: What Employers and Employees Need to Know Now

Background of the raid

The recent inspections are part of a coordinated effort to enforce the Act on Combating Illegal Employment. The focus is not only on the illegal employment of workers without valid work permits, but also on non-compliance with the statutory minimum wage and the withholding of social security contributions. During the inspections, thousands of workers were interviewed and the business records of hundreds of employers were reviewed.

Risks and Consequences for Employers

For employers who hire undocumented workers, the consequences can be severe. They face not only substantial fines but also prison sentences of up to ten years in particularly serious cases. In addition, the back payments for evaded social security contributions and taxes can threaten the very survival of the business. Furthermore, a company may be barred from future government contracts.

What Employees Should Know

Undeclared work also carries significant risks for employees. They are not entitled to continued pay in the event of illness, paid vacation, or unemployment benefits. In the event of a workplace accident, they are not covered by statutory workers’ compensation insurance. Furthermore, they are committing a criminal offense and may face back taxes and penalties from the tax authorities and social security agencies.

Prevention and Counseling

To protect themselves from these risks, construction companies should ensure that their employment relationships are fully and accurately documented. This includes properly registering all employees with social security agencies, complying with the minimum wage, and correctly paying taxes and social security contributions.

ROSTALSKI successfully defends companies and their executives in the construction industry against allegations made by customs authorities. With our many years of experience in commercial and criminal tax law, we are here to support you every step of the way, from the initial search through to the conclusion of the proceedings.

We develop effective defense strategies—whether you’re facing allegations of illegal employment, failure to pay minimum wage, or failure to pay social security contributions—to minimize the financial and personal consequences for you.

The recent raid has shown that authorities are increasingly targeting the construction industry. This makes it all the more important for everyone involved to protect themselves legally.

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