Quick facts

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Poland, which is located in Central Europe, is bordered by Germany, the Czech Republic, Slovakia, Lithuania, Ukraine, Russia, and Belarus. It provides straightforward access to Scandinavia across the Baltic Sea. With Warsaw as its capital, Poland is divided into 16 provinces (voivodeships). The zloty (PLN) is the national currency, and Polish is the official language. Acvian provides PEO and EOR in Poland.

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Poland belongs to a number of international institutions, such as the World Trade Organization (WTO), the Organization for Economic Co-operation and Development (OECD), the European Union (EU), and the North Atlantic Treaty Organization (NATO).

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Employment contracts

In Poland, there are differing contract kinds, including open-ended and fixed-term contracts.

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Probation period

The trial period cannot last more than three months.

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Working hours

In an accepted settlement period, which cannot be longer than four months, the working time cannot be more than eight hours per day and forty hours per typical five-day workweek. This means that, within the framework of the settlement period, a weekly norm always has an average character, and also that character may change based on the working time organization.

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Following the circumstances specified in the Labor Code, the legislator has made it possible to reduce or increase the settlement period and the number of hours worked per day. However, the total weekly working time, including overtime, cannot, on average, exceed 48 hours within the acceptable settlement term.

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Vacation days

Depending on the number of years worked, annual paid vacation leave is either 20 (minimum) or 26 days long. A worker who has been employed for more than ten years may request 26 days of vacation time. On days that are working days for the employee, vacation is given.

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The holiday leave may be divided into portions upon the employee’s request. However, in this scenario, at least one such portion of the vacation time must last for a minimum of 14 consecutive calendar days. The pay for the holiday leave is paid in the same amount as for working days.

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Sick leave

When an employee is unable to work because of illness or isolation brought on by a contagious disease, for a total of up to 33 days in a calendar year, or for an employee over the age of 50, for a total of up to 14 days in a calendar year, the employee is still entitled to 80% of their pay. An employee retains the right to receive 100% of her pay in the event of a pregnancy-related illness that occurs within the time frame mentioned above. The employee is entitled to Social Insurance Agency sickness payments if the period of incapacity to work remains longer.

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Maternity / Paternity leave

A female employee who gives birth to one child is entitled to 20-week maternity leave. If parents give birth to more than one child, this leave is extended correspondingly. Prior to the expected due date, the female employee may take no more than six weeks of maternity leave. Any of the parents may be given an extra 32 weeks of parental leave, for a total of 52 weeks of leave linked to childbirth. In general, the parent on leave due to childbirth will be paid 100% of their basic salary for the first half of the leave and 60% for the second.

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The female employee may waive her right to the remaining of her maternity leave after taking at least 14 weeks of it after childbirth. In this situation, the employee—the father who is raising the child—is granted the remaining unused period of the maternity leave upon his written request. The employee, who is the father of the child, is also entitled to 2-week paternity leave.

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Wages and Salary Payment

Effective January 1st, 2024, the prescribed minimum wage in Poland stands at 4242.00 PLN, with an increment to 4300.00 PLN (gross salary) effective July 1st, 2024.

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For those who are receiving a salary, wages are often paid monthly; for those who are paid by the hour, they may be paid weekly or monthly. Other payment schedules, like every two weeks, may be used by some employers.

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Whatever the frequency of payment, it must be detailed in a written statement of particulars sent to every employee at the start of employment or earlier.

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Benefits

Paid vacation, health insurance, worldwide accident insurance.

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Bonuses / Expenses

Employer reimbursements for non-business costs are typically subject to taxation for the employee. To a specific level, business travel expenses can be paid without creating a tax obligation. The employee receives a taxable benefit when the employer covers school costs or home visits.

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Employer Taxes

Employer contributions to Social Security vary based on the employee’s gross pay and are typically between 19.21% and 22.14%. Additionally:

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• Pensions and disability insurance amount to 16.26% of the total gross salary, capped at PLN 234,720 in 2024.
• Accident insurance ranges from 1.67% for employers with up to nine employees to 0.67% to 3.33% for those with more than nine employees, with the exact rate contingent on the business sector. Foreign employers typically apply a flat rate of 1.67%.
• The Labor Fund entails a contribution of 2.45% of the total gross salary.
• The Employee Guaranteed Benefits Fund requires a contribution of 0.10% of the total gross salary.

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Rates vary depending on the type of contract with the employer or Poland EOR.

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Employee Taxes

The tax structure applicable to income earned in 2024 is as follows:

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• Income up to PLN 120,000 annually incurs a tax rate of 12%, with a deduction reducing tax liability by PLN 4,242 (equivalent to 12% of PLN 30,000, the tax-exempt portion of income as of January 2024).
• Income exceeding PLN 120,000 annually is taxed at a rate of 32%.
• Certain types of income are subject to a flat-rate tax of 19%, without aggregation.

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Social Security Contributions are outlined as follows:

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• Pensions and disability insurance: 9.76% of the total gross salary.
• Sickness insurance: 2.45% of the total gross salary.
• Health insurance: 9% of the total gross salary.

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Rates may vary depending on the type of employment contract.

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Notice Period

For contracts, including with Poland EOR, having fixed or unlimited terms, the notice period can be two weeks, one month, or three months; for agreements with completed trial periods, it can be three working days, one week, or two weeks.

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Termination and Severance Pay

Employees are entitled to severance payments when employment is terminated as part of a collective dismissal or when an individual is let go for reasons that do not affect them (assuming the firm employs at least 20 people).

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The severance payment’s amount cannot be greater than 15 times the minimum remuneration for employment specified in the Act’s minimum wage regulations (i.e., the maximum amount of severance is approx. 8.600 EUR). However, the parties may agree to go above this cap. The Labor Code also outlines the provision of a death benefit and severance pay to an employee in conjunction with retirement or disability.