diff --git a/haskell/cabal.bzl b/haskell/cabal.bzl
index d25b1368c..6511d29fb 100644
--- a/haskell/cabal.bzl
+++ b/haskell/cabal.bzl
@@ -140,7 +140,8 @@ def _prepare_cabal_inputs(
         package_database,
         verbose,
         transitive_haddocks,
-        dynamic_binary = None):
+        is_library = False,
+        dynamic_file = None):
     """Compute Cabal wrapper, arguments, inputs."""
     with_profiling = is_profiling_enabled(hs)
 
@@ -212,16 +213,19 @@ def _prepare_cabal_inputs(
         for arg in ["-package-db", "./" + _dirname(package_db)]
     ], join_with = " ", format_each = "--ghc-arg=%s", omit_if_empty = False)
     args.add("--flags=" + " ".join(flags))
-    if not hs.toolchain.is_darwin and not hs.toolchain.is_windows:
+    if dynamic_file:
         # See Note [No PIE when linking] in haskell/private/actions/link.bzl
-        args.add("--ghc-option=-optl-no-pie")
+        if not (hs.toolchain.is_darwin or hs.toolchain.is_windows):
+            version = [int(x) for x in hs.toolchain.version.split(".")]
+            if version < [8, 10] or not is_library:
+                args.add("--ghc-option=-optl-no-pie")
     args.add_all(hs.toolchain.cabalopts)
     args.add_all(cabalopts)
-    if dynamic_binary:
+    if dynamic_file:
         args.add_all(
             [
                 "--ghc-option=-optl-Wl,-rpath," + create_rpath_entry(
-                    binary = dynamic_binary,
+                    binary = dynamic_file,
                     dependency = lib,
                     keep_filename = False,
                     prefix = relative_rpath_prefix(hs.toolchain.is_darwin),
@@ -426,7 +430,8 @@ def _haskell_cabal_library_impl(ctx):
         cabal_wrapper = ctx.executable._cabal_wrapper,
         package_database = package_database,
         verbose = ctx.attr.verbose,
-        dynamic_binary = dynamic_library,
+        is_library = True,
+        dynamic_file = dynamic_library,
         transitive_haddocks = _gather_transitive_haddocks(ctx.attr.deps),
     )
     outputs = [
@@ -702,7 +707,7 @@ def _haskell_cabal_binary_impl(ctx):
         cabal_wrapper = ctx.executable._cabal_wrapper,
         package_database = package_database,
         verbose = ctx.attr.verbose,
-        dynamic_binary = binary,
+        dynamic_file = binary,
         transitive_haddocks = _gather_transitive_haddocks(ctx.attr.deps),
     )
     ctx.actions.run(
diff --git a/haskell/private/actions/compile.bzl b/haskell/private/actions/compile.bzl
index cb5b6ece3..90c0cc909 100644
--- a/haskell/private/actions/compile.bzl
+++ b/haskell/private/actions/compile.bzl
@@ -475,9 +475,12 @@ def compile_library(
     c = _compilation_defaults(hs, cc, java, posix, dep_info, plugin_dep_info, srcs, import_dir_map, extra_srcs, user_compile_flags, with_profiling, my_pkg_id = my_pkg_id, version = my_pkg_id.version, plugins = plugins, preprocessors = preprocessors)
     if with_shared:
         c.args.add("-dynamic-too")
+
+        # See Note [No PIE when linking] in haskell/private/actions/link.bzl
         if not hs.toolchain.is_darwin and not hs.toolchain.is_windows:
-            # See Note [No PIE when linking] in haskell/private/actions/link.bzl
-            c.args.add("-optl-no-pie")
+            version = [int(x) for x in hs.toolchain.version.split(".")]
+            if version < [8, 10]:
+                c.args.add("-optl-no-pie")
 
     coverage_data = []
     if hs.coverage_enabled:
diff --git a/haskell/private/actions/link.bzl b/haskell/private/actions/link.bzl
index 0e2f392d8..14dc9e8b2 100644
--- a/haskell/private/actions/link.bzl
+++ b/haskell/private/actions/link.bzl
@@ -213,7 +213,10 @@ def link_binary(
 # on this setting GHC would then automatically set `-no-pie`. However,
 # rules_haskell uses GHC's `-pgmc` flag to point GHC to the CC toolchain's C
 # compiler. This disables the flags configured in the `setting` file. Instead,
-# we have to pass `-no-pie` explicitly.
+# we have to pass `-no-pie` explicitly when linking binaries.
+#
+# In GHC < 8.10, we must always pass -no-pie. In newer compilers, we
+# must take care to only pass -no-pie when compiling libraries.
 #
 # Ideally, we would determine whether the CC toolchain's C compiler supports
 # `-no-pie` before setting it. Unfortunately, this is complicated by the fact