The plastic sheeting serves as a vapor barrier, and is needed only if your house is in a region where outside temperatures drop below freezing. The principle is that air inside of the house has moisture--from your breathing, from cooking, from the bathroom, and from your humidifier. Without the vapor barrier, the moisture will get into your insulation, which has a temperature gradient with the inside surface at room temperature and the outside surface below freezing. At some point within the insulation the moisture will freeze and ice will accumulate. This not only reduces the effectiveness of the insulation, but makes for a large problem in the spring when the ice melts.
You can see that the vapor barrier should be against the inside wall, so that moisture can't get in the insulation. If you insulate your floor, the vapor barrier must go up. That is why it is best to use faced insulation, with the face up. Don't use plastic sheeting in conjunction with faced insulation, as moisture can get trapped between the two.