Compensating employees is a critical part of your company’s growth process. Different countries have various minimum wage laws, bonus requirements, and payment methods that you must learn before adding employees to your payroll. Another equally vital area is benefits. Failing to provide guaranteed benefits could lead to fines, and failure to offer the appropriate supplemental benefits will cause employees to look for positions elsewhere.
Poland compensation laws
Poland recently raised its minimum wage in 2023 to PLN 3,600 gross per month. Employees typically work 8 hours a day and 40 hours each week. Anything more is considered overtime. Poland’s compensation laws base overtime on an allowance schedule of 50% to 100% of gross pay on top of the employee’s regular salary or additional leave time.
Guaranteed benefits in Poland
A successful Poland benefits management system first needs to cover all guaranteed benefits. Poland has 13 public holidays in which employees receive the day off. Employees are entitled to 20 or 26 days of paid leave, depending on tenure. Tenure is considered based on all periods of employment and education — not just at the current employer. Employees with less than 10 years of tenure are entitled to 20 days of leave while employees with 10 years or more of tenure are entitled to 26 days.
When leave is unused, it may be carried over to the following calendar year. There is a carryover period of up to 3 years. 4 on-demand days are included in this leave entitlement.
Another guaranteed benefit is parental leave, which is paid for by the Social Security Bureau (ZUS). The length of leave depends on how many children the employee births. After giving birth to 1 child, the employee receives 20 weeks of leave, while an employee who gives birth to 5 or more children receives 37 weeks. Spouses of pregnant employees receive 2 weeks of parental leave, which they can take before the child reaches 12 months of age.
Poland benefits management
Poland benefits management also includes any supplemental benefits employees may expect. Private health insurance is becoming more common in Poland. Companies that choose to provide an additional health insurance package can combine it with the mandatory preventive medical examination under 1 contract with an Occupational Medical Center. It’s also possible to give employees an allowance of around PLN 350-PLN 600 a month to use for health insurance.
Restrictions for benefits and compensation
Employers should keep in mind any additional restrictions for benefits and compensation based on industry and location. Work with an expert or research the statutory minimums ahead of time so that you can provide employees with the best possible plan.
Poland competitive benefits planning
Growing companies will find that establishing a competitive employee benefits plan is a critical factor in building an international team. When establishing a business in Poland, employers must focus on creating a program that fits employees’ needs, works with the budget, and meets legal requirements.
Poland employee benefits plans
Employee recruiting and retention are vital to business growth in a new country, and the employee benefits program should reflect the importance of the team. Employers must strategically balance legal compliance, employee expectations and needs, and the company’s budget to develop the best plan for their unique requirements.
During their employment, employees may face various life events, from starting a family to having an unexpected medical emergency. When companies provide trusted support for employees, they’ll return this investment with more engagement and want to stay with the company longer.
Along with mandatory benefits, offering these practical benefits and perks can help attract and retain talent in Poland:
- Private medical insurance
- Life insurance
- A company mobile phone
- Business travel insurance
- Gym memberships
- Subsidies for education
Requirements for employee benefits in Poland
As an employer, you are required by law to meet these benefits stipulations at a minimum:
- Pension (PPK)
- Social insurance
- Occupational medicine (OM)
- Parental leave
- At least 20 or 26 days of annual leave (depending on tenure)
- Holiday leave for the 13 public holidays
- Paid sick leave of 182 days for 1 disease
- Leave for life events, such as a wedding in the family
- Bereavement leave
How to design your employee benefits program
Companies should begin planning with a holistic picture of their program scope, employee needs, and market conditions by following these steps.
1. Identify company goals and available resources.
As companies begin planning their employee benefits scheme, they must prioritize setting goals for benefits administration. Consider currently available resources and future growth opportunities you may wish to pursue, which often involves conferring with stakeholders and business partners to identify priorities.
2. Implement a needs assessment.
It’s also important to understand what employees need in the current market and region. Companies should hold interviews with local employees and send out questionnaires to understand the top needs of employees. The insights gathered will help employers offer benefits of optimal value to teams.
3. Create an employee compensation and benefits plan.
Once companies have completed the research process, they should analyze the data gathered and incorporate it into their benefits program. Employers need to start with the requirements and apply the remaining budget to the benefits local employees will appreciate the most. As they calculate benefits, companies must ensure that they’ve included employee contributions, cost containment features, administration expenses, and any outsourcing needs.
Average cost of benefits per employee
Because benefits plans can be highly individualized, final expenses for the program may vary. The design is key to keeping benefits administration sustainable, so budget and additional expenses should be considered in the planning process.
How to calculate employee benefits
Employers must contribute 1.5% of gross employee salary toward the mandatory pension plan.
Poland’s social insurance system provides coverage for the inability to work due to disability, death benefits for the children of a deceased employee, and sickness and work accident insurance. However, many companies provide additional coverage to ensure a better quality of life for employees and their families.
While there are no legal regulations for supplemental benefits, it is possible to calculate competitive rates by evaluating market standards. An understanding of the common practices within the specific region and industry will help companies offer attractive benefits for employees.
How are employee benefits taxed in Poland?
Cash remuneration and in-kind benefits earnings are considered taxable income in the country. These taxable benefits include:
- Allowances over a minimum limit
- Awards and bonuses
- Cash equivalents for unused holiday leave
- Non-pecuniary benefits
- Employer-provided housing
Employee health benefits plans
All employees receive state-funded public healthcare. However, most companies in Poland also offer private insurance options to provide additional health coverage for employees. To be competitive in the region, companies will likely want to explore possibilities for private employee healthcare as well.
Partner with G-P to build your everywhere workforce.
As your partner in global expansion, G-P will handle payroll and compliance, so you can focus on growing your team and scaling your business. Our market-leading Global Growth Platform™ is powered by the first fully customizable suite of global employment products and backed by the industry’s largest team of in-country HR and legal experts to streamline payroll management and help you offer competitive, compliant local benefits.
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