Shops Closed on Sunday in Poland? Bad Idea for Consumers, Employees and the Retail Sector

Nick Papakyriazis || Creative Commons

At the beginning of September, the representatives of the biggest Polish trade union “Solidarity” submitted in the Polish parliament a policy proposal to ban Sunday trading. This proposal, signed by hundreds of thousands of Poles, became a trigger for a public discussion on potential effects of this regulation. Unfortunately, it turned out that unionists used many false arguments, which could mislead Polish citizens. In fact, Sunday trading ban involves negative consequences for employees, consumers and for the entire retail trade sector in Poland.

Sunday Trading Ban Will Harm Employees and Certain Entrepreneurships

The experiences of other countries and previous research studies show that Sunday trade regulations may have serious negative impact on employees. First of all, they can lead to lower employment – as it happened in the Netherlands, Germany, Canada and the USA. It is a logical conclusion. A shop which starts to function six days a week may not employ the same number of workers (ceteris paribus).

Another negative effect of this regulation will be a decline or slower growth of salaries in the retail trade in Poland. Regulations of Sunday trading significantly favor small, less productive shops. Ban will reduce the entire sector’s productivity. Wages in economy depend on productivity and grow with it. Sunday shopping ban is the most harmful for larger, efficient stores, which provide the best working conditions, thanks to appropriate work organization, economies of scale etc. The Polish Statistical Office (GUS) data confirms this mechanism – the bigger the store is, the higher salaries workers can get.

Sunday trading ban will have an impact on turnovers of certain entrepreneurships, especially the biggest and the most productive ones. Shopping ban will forbid part of customers to do shopping when it is the most convenient for them. As a result, these consumers will bear higher opportunity costs and may limit their expenses. The decrease in sales may also be influenced by the possible prices increases after implementing strict regulations on Sunday, as observed in Germany, the Netherlands and Sweden. The price increase is due to lower return on investments. If the shops will have to be closed one day a week, the capital will bring smaller profits, which will directly affect the price level.

Polish unionist often mention Hungary as an example of the country where the turnover in the retail trade business increased after introduction of Sunday trading ban in 2015 (it was abolished after one year). However, there is no proof that this higher turnover was due to Sunday trading ban as the “Solidarity” trade union claims. Hungarian Statistical Office shows that the turnover began to rise in 2013 and further increased in 2015 which was caused by positive economic conditions – increase in real wages, good labor market situation, moderate inflation and declining oil prices. Contrary to the claims of the Polish unionists, the Sunday trading ban has not been mentioned as a factor determining turnover growth.

The Ban on Sunday Trading Will Harm Consumers

Ludwig von Mises once compared a market to a boat. He said that entrepreneurs are responsible for holding the rudder, but the boat captain is a consumer, who has a real power. The consumer actually decides what and when should be sold and produced, not the government or entrepreneurs. The ban will limit this natural, free market power and will have other negative consequences for consumers. Introduction of this regulation in Poland will increase the economic costs for customers, because of the higher opportunity costs. A customer who particularly prefers shopping on Sunday (e.g. because of non-traditional working hours) will be forced to do shopping on a different day of the week at the cost of e.g. family life. The ban on Sunday trading is not only a limitation of a voluntary exchange of goods and services between entrepreneurs and customers, but it also deprives Polish citizens of a possibility to manage their time and money. Polish unionists want to decide for the citizens how and when to rest and work.

Other European Countries Liberalise Trade on Sunday

Polish unionists often show examples of other European countries, which regulate or prohibit trade on Sundays. Some countries in Europe do prohibit or regulate Sunday shopping. However, for over 20 years there is a discussion in many countries about the abolition of this regulation, even in the most conservative ones. The European trend is the liberalization of the law. In the recent years, eight EU countries decided to abolish Sunday trade ban or to significantly relax the existing law. 19 out of 28 EU members do not apply any restrictions, and among the countries that joined the EU after 2004 no country has restrictions on Sunday trading. Hungary and Cyprus used to have it, but it was abolished – in Hungary due to the public dissatisfaction, in Cyprus due to the decision of the Supreme Court.

Polish Unionists Favor One Particular Professional Group

The whole argument for a ban on Sunday trading in almost every European country is to defend one particular professional group – employees of the retail trade sector. Polish unionists point out that “they fight for the freedom of workers”, but they forget that they are fighting for the “freedom” of only one particular group of employees. They forget that employees sign voluntary contracts of employment and that employees can choose the most appropriate job for them. Therefore, a worker can decide if s/he wants to work on Sunday or not. Of course, difficult financial situation may encourage an employee to sign a contract and accept presented conditions – however, for many people, work is not connected with pleasure, but with necessity to earn money to make ends meet.

What is more, in the justification of their bill the unionist pointed out that employment will increase in other industries, such as culture or bars/restaurants. This logic is therefore inconsistent – one particular professional group should not work on Sundays but the other should work more? Polish unionist define freedom as a right of retail trade workers to rest on Sunday, but on the other hand, they want catering business and culture employees to work harder. It is illogical. Of course, there are also some religious aspects mentioned by the unionists but it should not be a motive for a public policy change as it contradicts the separation of church and the state and it still does not mean that politicians should favor one chosen professional group.

In fact, Sunday trading ban limits citizens’ freedom and restricts a voluntary exchange of goods and services between consumers, employees and employers. Furthermore, Polish unionists want to punish entrepreneurs for the trade on Sunday – their original proposal is maximum 2 years of prison. There is no doubt that the ban on Sunday trading will be harmful to almost everyone.

Maciej Orczyk