Before you hire employees in Poland, it’s crucial to offer them the right benefits package to stay compliant with Polish labor laws. As a member of the European Union (EU), Poland is obliged to uphold employees’ rights and protections as laid down in EU labor laws.
Let's dive into what you need to know to meet Poland's labor laws and show some love for your Polish team.
What employee benefits are mandatory in Poland?
The mandatory benefits you need to offer employees in Poland are regulated by the Polish Labor Code of 26 June 1974, known in Polish as the “Kodyks Pracy”, as well as the various acts amending it over the years. The Social Insurance Institution (ZUS) collects benefit contributions and ensures that benefits are paid out to those who qualify while the Ministry of Family and Social Policy oversees the implementation of labor law. If you employ a Polish worker and fail to offer them these mandatory employee benefits, you could wind up with legal issues.
Keep in mind that the benefits required by the Polish Labor Code are statutory minimums and as an employer, you can always offer more than these mandatory benefits.
Also, note that the provisions in the Polish Labor Code don't only apply to employees with a regular employment contract—they apply to anyone who performs any kind of work according to your instructions and under your control, at a place and time that you specified, that you have paid for with fixed remuneration.
It doesn’t matter what you call the contract, it will be regarded as an employment contract and needs to comply with the Polish Labor Code. Independent contractors in Poland are not entitled to the same employee benefits.
Many changes to Polish labor law are being implemented in 2023, so it’s a good idea to keep an eye on the news to remain on top of things.
Both employees and employers contribute to the employee’s pension insurance. The overall rate is 19.52% of the employee’s assessment base, with employee and employer each covering 9.76%. However, there is a cap of PLN 208,050 per year on the contribution calculation basis for pension and disability insurance above which contributions are not paid.
Currently, people in Poland can start claiming old-age pension at 65 for men and 60 for women.
Employees who become disabled may claim a disability pension. Both employees and employers contribute to the employee’s disability insurance, with the employer paying most of the total rate of 8% of the assessment base. The employee’s contribution is at a rate of 1.5% and the employer is at a rate of 6.5%. Since 2023 there is a cap of PLN 208,050 per year on the contribution calculation basis for pension and disability insurance.
Work accident insurance
As an employer, you must contribute to the employee’s work accident insurance while the employee doesn’t have to contribute. The rate you must contribute varies between 0.67% and 3.33% of the assessment base and depends on the type of activities the employee’s job entails.
Employee Capital Plan (PPK)
The employment capital plan (PPK) is a retirement savings scheme to which the employee, the employer, and the government contribute. It aims to provide income additional to pension payments once the employee has retired but employees can make withdrawals from their fund at any time. Employees under the age of 55 are automatically enrolled but can opt out.
As the employer, you select the financial institution that will manage the account. You contribute at a rate of 1.5% of the employee’s salary and up to 2.5% voluntarily. The employee contributes 2% of their salary and up to 2% voluntarily. The government contributes PLN 250 as a welcome contribution and an additional PLN 240 every year.
Occupational Health and Safety training and medical examinations
Before an employee is allowed to work in Poland, they must undergo Occupational Health and Safety (OHS) training and preventative medical examinations. You as the employer must provide these.
As an employer, you are responsible for your employees’ safety at work. You need to do occupational health and safety risk assessments periodically and take steps to eliminate these risks. You need to provide each employee with the safety equipment necessary to do their job and must provide training so that they know the protocols they must follow.
You may not allow an employee to work without a valid medical certificate that states that there are no contraindications to working in a specific position and specific conditions. To do this, you need to refer the employee for medical checkups before you employ them, as well as periodically during their employment. You need to pay the employee for the time not worked during these checkups, which should be done during work hours if possible. You also need to pay for these checkups and any transport costs involved.
There are two types of paid sick leave in Poland.
- The first is typical sick leave, which is for the first 33 days during a calendar year, or 14 days for employees aged 50 or above. You as the employer pay the employee 80% of their average wages for the last 12 months.
- The second type of sick leave is long-term sick leave, which may not exceed 182 days continuously in a calendar year. Once the period of typical sick leave has passed, the employee can claim sickness benefits from the government, which are 80% of their salary. Employees contribute to sickness insurance at a rate of 2.54% of their assessment base and the employer has no obligations to contribute to this insurance.
Full-time employees in Poland are entitled to 20 working days of holiday leave per calendar year if they’ve worked for the employer for up to 10 years, and 26 working days if they’ve been with the employer for more than 10 years. The employee may take four of these days off on demand, without prior approval. In the first year of employment, the number of holiday leave days an employee is entitled to be calculated on a prorated basis. Employees in certain professions may be entitled to additional holiday leave.
Unused leave days are carried over to the following calendar year and upon termination of employment, you pay out in cash any unused days left over.
According to the Non-working Days Act of 1951, there are currently 13 statutory holidays in Poland, although the government can declare one-time national holidays at their discretion. Employees are entitled to a paid day off unless the holiday falls on a Sunday, which would be regarded as a paid day off already. Employees who have to work on statutory days are entitled to a paid day off in lieu unless the day falls on a Sunday.
What employee benefits are optional in Poland?
The mandatory benefits in Poland are the minimum that you as an employer must provide your employees. However, you can also provide additional benefit plans and perks to help you attract and retain employees. Below are some of the most common supplementary benefits.
Supplementary pension contributions
While the minimum you contribute to the employee’s PPK is 1.5% of their salary, you can contribute an additional amount of up to 2.5%. You can also offer an Employee Pension Plan (PPE), where you make most of the contributions, in addition to or sometimes in place of a PPK.
Private health insurance
While public healthcare in Poland is free, it’s also viewed as poor quality. Most Polish employers, therefore, offer private health insurance.
Another popular benefit that companies in Poland offer their employees is life insurance, which often includes disability insurance. You as the employer can cover this insurance in full or in part.
Business travel insurance
When an employee travels for work outside of Poland, you as the employer must cover the cost of any medical treatment or related transport that may occur. For this reason, most employers in Poland offer their employees business travel insurance.
Paid time off
Many employers offer paid time off in addition to the 20-day minimum, often up to 30 days. It’s also common to give an employee the day off on their birthday.
Many companies offer cash bonuses, for example for good job performance. However, this bonus is subject to tax and social security contributions.
Fitness and wellness assistance
Many Polish employers offer fitness and wellness assistance. This can be in the form of subsidized gym memberships and employee assistance programs, for example.
Meal and transport allowances
Meal vouchers or in-house meals and public transport allowances are becoming more common in Poland. Some companies may also offer high-level employees a company car or reimburse their fuel costs.
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Disclaimer: Rippling and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any related activities or transactions.