Poland is currently Europe's leading outsourcing hub because of low personnel costs. It is the only country in Europe that successfully avoided recession during the 2008-2009 global financial crisis.
The workforce in Poland has all the essential ingredients to make good employees. The people are ambitious, hard-working, loyal, and eager to learn with an entrepreneurial mindset.
So, if you are planning to expand and want to tap into this pool of talented individuals, you can hire in Poland with ease.
Skuad's Poland EOR (Employer of Record) solution helps you to expand your business in Poland without requiring you to establish a local entity.
In Poland, you may either hire employees by setting up a subsidiary or via an employer of record platform, like Skuad.
Hiring in Poland can be done through popular Polish job portals, with many users, and through professional portals like LinkedIn.
You can also post job ads in Polish newspapers. Many international employers conduct interviews virtually in case of remote hiring through online communication channels; for this purpose, one should keep in mind the timing difference.
Also, adhere to the background check laws, as conducting background checks during the hiring process is strictly prohibited in Poland.
Working with Skuad's EOR team will help you understand the detailed data protection laws, along with employees’ rights, working conditions, remuneration, timings, and more.
Our team will manage everything from the hiring to the retirement cycle of your employees in Poland.
Several steps are required for the incorporation to engage in any commercial activities; therefore, it is necessary to prepare all the documents for the smooth functioning of the process.
The list of documents is as follows:
Articles of Association.
Contract or statute with a certified translation in Polish.
Power of attorney for company registration.
Founders: The company has a single shareholder, and there are no restrictions on the founders' total number or nationality.
Capital Contribution: 5000 PLN must be paid up in cash or kind before the business is registered.
Management: At least one person is on the management board, and when the company has more than 25 shareholders, or when its capital exceeds 500,000 PLN, it must have a supervisory board with at least three individuals.
A REGON number and tax identification number are assigned for the LLC.
Registration for VAT purposes is also required.
With Skuad’s presence in Poland, you can easily register an LLC in Poland to commence your business activities and directly start hiring employees.
Also, it is important to stay compliant with the taxation structure in Poland. The LLC is taxed on its income produced in the country at a fixed rate of 19%. In addition, companies must comply with the annual reporting and audit requirements.
Connect with Skuad’s team of experts to handle your business compliances on your behalf. Book a demo here.
Setting up an entity in Poland: Pros and Cons
Poland is a popular destination for businesses looking to expand operations in Central Europe.
Setting up a legal entity in Poland can provide various advantages for direct hiring in Poland, but it's essential to weigh the pros and cons before making a decision.
Pros of hiring in Poland through your entity:
Having your entity in Poland can give you greater negotiation power with local suppliers, service providers, and potential employees.
You can leverage the country’s favorable tax regime to optimize your business taxes in Poland.
Setting up an entity allows you to have direct control over hiring, onboarding, and managing your employees.
You can tailor your company culture and practices to suit the business culture in Poland better.
Having your entity in Poland can help you build brand recognition and establish a strong local presence.
Cons of hiring in Poland through your entity:
Setting up and managing an entity in Poland can be administratively complex.
Adhering to Polish labor laws, tax regulations, and other legal requirements can be time-consuming.
Setting up an entity for direct hiring in Poland requires an initial investment, including costs for registration, office space, and legal fees.
You can consider modern business solutions like an employer of record in Poland to offset the HR costs involved in hiring Polish employees while you expand in the region.
EOR services in Poland
Poland Employer of Record (Poland EOR) solution makes expanding your business in Poland easier and faster, minus the complexities and expenses that may occur while establishing an entity in Poland without a feasibility study.
Connect with Skuad to expand your business internationally with our technology-driven, automated, unified platform.
General terms of Employer of Record service provider in Poland:
Taxes that apply to the invoice
The Total Employer Liability is (up to) 22.14%.
Minimum duration of service
3 months
Currency Accepted
Polish Zloty (PLN)
Required Details and Documents
For Polish Citizens: ID proof, place of residence, CV, bank details, education details. For Expatriates: Job details, educational qualifications, technical qualifications, CV, copy of passport, copy of ID, bank details, photographs, work permit.
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Onboarding & Agreements in Poland
Onboarding is the process of integrating new hires into your company. It's crucial for setting expectations, ensuring employee engagement, and ensuring new employees understand their roles and the company culture.
How to successfully onboard employees in Poland
Prepare everything the new employee needs before their first day, like a workspace and equipment.
Provide a welcome packet with company policies, job expectations, and important contacts.
Introduce the new hire to team members to help them feel welcome.
Offer training sessions to explain their role and responsibilities.
Set clear, achievable goals for their first few months.
Check-in regularly to see how they're adjusting and offer support.
Types of employment agreements in Poland
Indefinite-Term Contract: Most common, providing job security with defined terms and conditions.
Fixed-Term Contract: Used for temporary or project-based work with a specified duration.
Temporary Contract: For a specific period, often used for seasonal or short-term needs.
Onboarding checklist for Poland
Employment Contract: Ensure a clear and compliant contract in Polish (bilingual versions are allowed).
Work Permits: Obtain necessary permits for foreign workers.
Social Security Registration: Register new employees with the social security system.
Tax Registration: Register the employee with the tax authorities.
Health Insurance Poland: Ensure employees have adequate health insurance coverage.
Company Policies: Provide employees access to handbooks and familiarize them with company policies.
Work Authorization: Secure necessary work authorization documents for foreign workers.
Read more
Taxes in Poland
Here is a breakdown of employment tax in Poland, where we discuss employer and Poland employee tax rate obligations:
Employer Taxation in Poland
Tax
Explanation
Tax Year-End
31st December
Sales Tax
23%
Payroll Tax
No specific payroll taxes.
Corporate Tax Rate in Poland
In Poland, corporate tax (also called Podatek dochodowy od osób prawnych) is currently at 19%.
Employee Taxation in Poland
Tax
Explanation
Income Tax Rates
Annual Taxable Income under new regime (4% cess added)
Taxable Income
Rate
Up to PLN 85,528
17%
Over PLN 85,528
32%
Filing & Payment
30th April, and in case of payment from a Polish bank account, the tax payment due is transferred to the Treasury Office bank account on the same day.
In case the payment is made from foreign bank accounts, payments made within the EU are usually booked within 2 days, and payments from other countries within 3 or more days.
Public Pension
The pension age is 65 years for men and 60 years for women.
Health Insurance
An obligatory contribution of 9% to health insurance, although health insurance contributions are deductible from the employee's tax up to 7.75%
VAT
VAT Rate
Percentage
Applicable To
Standard
23%
Most goods and services are not covered by reduced rates
Reduced 1
8%
Basic food products, certain medical items, renovations, catering services. Includes specific agricultural products until December 31, 2024
Reduced 2
5%
Selected food products, printed books, and maps
Zero
0%
Intra-Community supplies of goods and exports
Exceptional
7%
Lump-sum VAT refunds for farmers
Exceptional
4%
Taxi services (no VAT deduction allowed)
Read more
Compliance Requirements in Poland
Here are some key compliance considerations for hiring & onboarding in Poland:
Employment laws
Poland's legal framework includes the Constitution of the Republic of Poland (which deals with general principles of freedom to work and social rights), international agreements on labor laws, the Poland Labour Code, acts and legislations defining employees' and employers' rights and obligations, and more.
Polish labor law is categorized into common law and autonomous labor law. Common law deals with the acts of Parliament and decrees.
It includes the Polish labor code, which deals with relations between employers and employees.
Autonomous labor law consists of all acts formed by social partners that are recognized by the State as legal acts, such as collective labor agreements and external collective labor agreements.
In January 2021, the Polish Government made certain changes in the wage structure, such as increasing the Poland minimum wage from 2600 Polish Zloty to 2800 Polish Zloty per month.
In terms of overtime, every employer has to pay compensation which has to be more than the employee’s gross earnings and salary for working beyond the working hours.
Foreigners from other European member states and states within the European Economic Area (EEA) and their family members also have access to employment in Poland.
However, if they want to work in Poland, they need to obtain a work permit and entry visa.
Skuad's EOR solution lets you build, pay, and manage a globally distributed HR team by staying compliant with the laws without setting up another entity.
Skuad’s unified employment platform enables organizations to hire the best talent in Poland while adhering to the Polish Labour Code in detail.
Employee/Contractor Classification in Poland
In Poland, qualified employees are easy to find through a state-paid university system, which produces highly specialized and innovative workers, especially in the IT and engineering fields.
Every employer needs to know how employment relationships are governed and performed while hiring employees in Poland, along with detailed knowledge of Poland's labor code.
There are three types of contracts: trial period, fixed-term, and unlimited term. These contracts should mention the parties, such as employer and employee, the date, conditions of work, remuneration, venue of work, and other necessary details as per the type of work.
Therefore, when choosing a type of employment, it is important to consider the above three categories to hire a good team according to your work.
With Skuad’s global HR platform, you can easily handle employee compliance and payroll management.
Fines/Penalties per Employment Laws
Polish laws enforce a fine ranging from PLN 1,000 to PLN 30,000 for violating employee rights.
Data protection is governed by the General Data Protection Regulation (GDPR), which is implemented under the Act of 10 May 2018 on the Protection of Personal Data, and:
It applies to the protection of the processing of personal data.
It applies to national regulations on various types of secrecy.
An A-type airport transit visa is issued only to the citizens of the countries listed below for transiting through the international areas of transport:
Afghanistan, Bangladesh, the Democratic Republic of the Congo, Eritrea, Ethiopia, Ghana, Iran, Iraq, Nigeria, Pakistan, Sudan, and Sri Lanka.
C-Type Visa
C-type visa, also known as the Uniform Schengen Visa, permits its holder to remain in the territory of all the Schengen area member countries for a maximum of 90 days during 180 days.
D-Type Visa
D-type national visa permits an individual to enter the territory of the Republic of Poland and to stay continuously or for several successive times for a total duration of more than 90 days during the validity of the visa but not longer than one year.
Polish Work Permits
Thanks to its robust country network, Skuad's EOR solution can help you seamlessly acquire work permits in Poland. Foreign nationals require a work permit, but the following categories of foreign nationals are exempted from obtaining a work permit:
Citizens of the EU, European Economic Area (EEA), and Switzerland, and members of their families.
Foreign nationals with a settlement permit.
Foreign nationals who have long-term EU resident status in Poland.
Individuals who were granted temporary protection. Refugees and people were granted ‘tolerated stay’ status.
Other foreign nationals are not obligated to obtain a work permit under specific regulations.
Work Permits
Explanation
Can Skuad Sponsor a work permit in Poland?
Yes
Processing Time
2 weeks
Work Permit Process
It is issued by the province governor relevant to the employer’s registered office.
Work Permit Validity
Fixed-term of not more than 3 years, and 5 years in case of management board members.
Work Permit Restrictions
The foreign national’s remuneration cannot be lower than the remuneration paid to a Polish employee in a similar position.
The district governor confirms that the vacancy cannot be filled by a person registered as unemployed or seeking employment.
Time frame
1-2 months to obtain a work permit.
Exceptions to the restrictions
A work permit is issued at the employer’s request and is the basis on which a work visa is obtained by a foreign national at the embassy in their place.
Foreign nationals must legalize their residence in Poland by obtaining a temporary residence permit if their stay in Poland exceeds three months.
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Payroll in Poland
When managing payroll in Poland, it’s essential to understand the local regulations and processes to ensure compliance and efficiency.
How to pay employees in Poland
Understand local regulations and processes for payroll in Poland to ensure compliance.
Classify employees as full-time, part-time, or contractors to determine tax and social security obligations.
Calculate the gross salary, including bonuses and additional benefits.
Deduct taxes and social security contributions, such as Poland income tax and health insurance.
The remaining amount after deductions is the net salary employees receive.
Pay salaries through bank transfers, ensuring all employees have valid bank accounts.
Consider using payroll services in Poland to simplify payroll management and ensure tax compliance.
Best way to pay your Polish employees
In Poland, every employer should be well aware of basic employee information such as name, date of birth, address, contact number, qualification, and bank account details to which the salary will be transferred.
Skuad’s Employer of Record solution has complete knowledge about valid tax registration compliances like KRS (National Court Register), Central Register, and Information on Economic Activity (CEIDG), which keeps records in a business register with information on entrepreneurs running their own businesses as sole traders in Poland.
Skuad ensures proper employment while complying with all the rules and regulations of the host country. Poland is among those nations that have adopted technology with innovative digital payment structures.
Every company is required to comply with the Polish laws on income tax, direct or withholding tax, sales tax, Poland salary tax, etc.
The payroll in Poland is classified into simple payroll, local payroll, external or outsourced payroll, and internal payroll. Skuad provides world-class facilities to employ and manage the payroll of competent staff in Poland.
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Benefits & Compensation per Polish Labor Law
Polish labor law, specifically the Labor Code, regulates the benefits and compensation offered to employees in Poland.
These regulations aim to ensure fair treatment and adequate remuneration for workers.
Public Pension
The pension age is 65 years for men and 60 years for women.
Health Insurance
An obligatory contribution of 9% to health insurance, although health insurance contributions are deductible from the employee's tax up to 7.75%.
Worker Rights
Entitlements
Explanation
Working Hours
40 hours across 5 days in a week.
Overtime is allowed in emergencies and when employers have special work requirements, 150 hours per year.
Overtime Eligibility
Overtime is paid at the rate of 150% of the regular pay.
On Sundays/holidays/at night the rate is 200%.
If employees work between 21:00 and 7:00, then they are eligible for an additional 20% payment.
Weekly Rest Period
Between 7 workdays, a rest period on Sunday is given.
Severance Pay
Amount of severance pay
The amount of severance pay is based on the employee's length of service:
Less than 2 years: One month's salary.
Between 2 and 8 years: Two months' salary.
More than 8 years: Three months' salary.
Cap on severance pay
Severance payments are capped at a maximum of 15 times the statutory minimum salary.
As of January 2022, this cap amounts to approximately PLN 45,150 (around EUR 9,445).
This limit ensures that the total amount payable does not exceed this threshold.
Working Conditions
In Poland, working conditions are primarily regulated by the Labour Code.
It outlines the rights and obligations of both employers and employees including working hours, rest period and paid leaves.
Anti-discrimination Laws
The Labour Code prevents discrimination based on sex, age, disability, race, ethnicity, nationality, political beliefs, union membership, religion, and sexual orientation.
It also protects employees from harassment and victimization related to these issues.
Health & Safety
Article 66 of the Polish Constitution guarantees every worker the right to safe and healthy working conditions.
Read more
Remote & Hybrid Work Policy in Poland
Poland has a dedicated provision for remote and hybrid work arrangements under its labor law.
Here are some key considerations for implementing a remote work policy in Poland:
There must be a written telework agreement outlining the terms and conditions of the arrangement.
Define clear criteria for determining which employees are eligible for remote work.
Determine who will provide or reimburse employees for necessary equipment like laptops, monitors, and internet access.
Establish clear communication channels and expectations for remote and hybrid workers.
While Polish labor law generally requires tracking working hours, there may be exceptions for remote workers under certain conditions.
Implement robust data security measures to protect sensitive information accessed remotely.
Provide guidelines for creating a safe and ergonomic remote workspace.
You can go through this remote work readiness checklist for more clarity.
Salary in Poland
You must fix salaries for your Polish employees above the current minimum wage in Poland at PLN 4,300 per month.
The average salary in Poland is 7,590 PLN per month, which is roughly 1,913 USD. This amounts to an average annual salary of 91,100 PLN, or about 22,963 USD.
Moreover, you can use Skuad’s salary insights tool to benchmark the salaries of your newly hired employees in Poland.
Leave Policy in Poland
Poland's leave policy is regulated by the Labor Code and collective bargaining agreements. Here are some key aspects of living in Poland:
Paid Public Poland Holidays
New Year’s Day (January 01)
Epiphany (January 06)
Easter Sunday (April 04)
Easter Monday (April 05)
Labour Day/May Day (May 01)
Constitution Day (May 03)
Whit Sunday (May 23)
Corpus Christi (June 03)
Assumption of Mary (August 15)
All Saint’s Day ( November 01)
Independence Day (November 11)
Christmas Day (December 25)
The second day of Christmas (December 26), Boxing Day
Entitlements
Explanation
Maternity & Paternity Leave
Twenty weeks of maternity leave for female employees upon the delivery of one child, with social security benefits.
Thirty-one weeks if she has delivered twins and up to 37 weeks for five or more children.
Paternity leave can be availed up to 2 weeks before the child’s birth.
When maternity leave ends, both parents are entitled to 32 weeks of parental leave or 34 weeks for multiple births. It can be availed at the end of the year when the child turns six years old and up to four segments, each lasting for a minimum of eight weeks, and will receive 60% of their basic allowance.
Employees who adopt a child are also entitled to the same number of leaves.
Annual Leave Accrual Entitlement
All employees in Poland are entitled to annual paid vacation depending upon the number of days worked:
Twenty days of paid leave if the employee has worked for less than 10 years.
Twenty-six days paid leave if the employee has been working for 10 years or more
(provided that the person who has been employed for the first time gathers 1/12th of their annual leave time for each month that they have worked).
Medical Leave
Employees are entitled to 33 days of paid sick leave with a payment of 80% of their standard pay.
If an employee requires more than 33 days’ leave, the employee is entitled to payment from Social Security for up to 180 days.
Employees who are aged 50 or above are entitled to the first 14 days of illness from their employer. After that, the employee’s payments are received from social security.
Other Leave
Two days for an employee's wedding or their child’s birth, death, or funeral.
There is one day for an employee's child’s wedding or death and one day for the funeral of the employee's relative.
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Background Checks in Poland
When conducting background checks in Poland, you must comply with Poland's data protection laws, including the General Data Protection Regulation (GDPR).
Background checks are commonly used to assess potential employees' suitability for a role. However, there are specific regulations in place to protect individuals' privacy and prevent discrimination:
You must obtain explicit consent from candidates before conducting any background checks.
Background checks are generally limited to verifying information provided by the candidate, such as employment history, education, and criminal records.
You canaccess criminal records, but they are restrictive and require specific authorization from the relevant authorities.
Credit checks are generally not permitted for employment purposes unless explicitly authorized by the candidate.
Termination and Offboarding
Probation & Termination in Poland
There is no specific term for a probation period in Poland, but it is defined as a trial period that lasts for 3 months.
A special employment contract is concluded for this. After that, a new employment contract is executed in the form of fixed-term and unlimited terms according to the Poland labor code.
Termination of service
Topics
Explanation
Notice For Termination Of Employment
Trial period
Duration of employment
Notice period
Less than 2 weeks
3 days
2 weeks to less than 3 months
7 days
3 months
14 days
Notice period
Notice during the probation period:
3 working days’ notice – if the probationary period is up to 2 weeks;
1-week notice – if the probationary period exceeds 2 weeks;
2 weeks’ notice – if the probationary period exceeds 3 months
Notice for Temporary or Permanent Employment:
2 weeks – if the employee was employed for up to 6 months;
1 month – if the employee was employed more than 6 months and less than 3 years
3 months – if the employee was employed for 3 years or more.
Employment can be terminated by:
Mutual agreement - a ‘statement of will’ of one of the parties with a period of notice (termination of a contract of employment with notice) expiry of the contract term.
The employment contract may be terminated by mutual consent at any time.
Additionally, consider investing in the right offboarding strategies for a smooth exit experience for your employees.
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Business Culture in Poland
Poland has a unique business culture that blends Eastern European traditions with Western influences. You can teach Poland culture by following certain cultural norms & business etiquette:
Poles can be more reserved and deliberate compared to some other cultures. Be patient and avoid rushing things.
Poland has a rich history and cultural heritage. Show interest in Polish culture and history.
Family values are highly valued in Polish culture. Polish business culture is hierarchical, and formality is highly valued.
Polish cuisine is known for its hearty and flavorful dishes. Sharing a meal can be a great way to build relationships.
Poles generally prefer a modest approach to dressing and behavior.
While English is widely spoken in major cities, learning Polish demonstrates respect and can facilitate communication.
Professional Employer Organization (PEO)
The most critical difference between a PEO and an EOR is that while the former acts as your co-employer, the latter acts as the legal employer of your employees.
If you opt for PEO services, you will still have to make key decisions on the outsourced activities, whereas an EOR requires no such hand-holding.
Once you partner with Skuad’s EOR, Skuad can manage complete HR responsibilities while you focus on other core areas of your business.
Skuad’s EOR solution easily helps your business expand in Poland according to your business’s requirements.
Moreover, Skuad’s experts will also guide you at every stage during the business expansion. Book a demo to learn more.
However, several factors ranging from the employment types and specific state laws to understanding the prevailing taxation laws can hold back and prolong the business expansion process.
Instead of setting up a new commercial entity and getting immersed in understanding the nuances of the prevailing laws, it is wise to partner with an EOR that will take care of your HR needs.
The EOR can ensure the HR practices align with the local legal system and leave no room for lapses or deviations.
Skuad’s globally distributed teams can make hiring exceptional talent in Poland an easy and straightforward process.
Skuad can also help manage your payroll and help your company remain compliant with the prevailing laws and taxation on a single unified employment platform. Contact us today to give shape to your ideas for business expansion in Poland.
Get in touch with Skuad to make your expansion dream a reality.
FAQs
1) What is an employer of record in Poland?
An Employer of Record (EOR) becomes your Polish staff's legal employer, handling HR complexities like payroll, taxes, and social security. This eliminates the need for a local entity setup. EORs in Poland ensure compliance with labor laws, lowering legal risks for your international recruitment.
2) How does an employer work in Poland?
An employer in Poland works by complying with Polish labor laws and regulations. They cover various aspects of the employment relationship, including minimum salary in Poland, working hours, vacation, sick leave, social security contributions, and unionization. Employers must also ensure that their hiring and onboarding practices are compliant with data protection laws and other relevant regulations. Additionally, employers are responsible for providing a safe and healthy work environment, managing employee performance, and addressing any disputes or grievances that may arise.
3) How do you choose an EOR in Poland?
To choose an EOR in Poland, consider factors like reputation, services, compliance expertise, references, cost, communication, and data security. Further, you can evaluate these factors to select an EOR that meets your business needs and ensures compliance with Polish labor laws.
4) How much does an EOR cost in Poland?
The cost of Employer of Record services in Poland (EOR) can vary significantly based on factors like the number of employees, location, services needed, industry, and additional fees. You can use Skuad's cost estimator tool to get a more accurate estimate, which provides a personalized quote based on your specific requirements.
5) What are the benefits of an EOR?
An Employer of Record (EOR) handles the international HR complexities you'd otherwise face – Poland payroll, taxes, and compliance. EORs become the legal employer for your global staff, removing the need for a local entity setup. By partnering with an EOR, businesses can focus on their core operations while ensuring compliance and minimizing risks in foreign markets.
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