How much does it cost to hire an employee in Poland?
Hiring an employee in Poland involves more than just completing the necessary formalities. Employers must first decide on the structure of employment and the type of contracts they want to offer. Each employment form is connected with different costs, which must be carefully considered. This guide outlines the costs associated with employment contracts, contracts of mandate, specific-task contracts and B2B contracts in Poland.
What are the costs of hiring employee under employment contract?
When hiring an employee under an employment contract, the employer must be aware that the salary specified in the contract is only part of the overall cost. Employers are required to pay social security contributions, health insurance contributions, and pension fund contributions, among other charges. Additionally, the employer must deduct an advance income tax payment from the employee’s salary each month.
When considering an employee’s salary under an employment contract, three key figures should be taken into account:
- Gross salary – the amount stated in the employment contract, from which the deductions are made;
- Net salary – the salary that the employee will receive to his/her bank account after mandatory deductions;
- Total employer cost – the final cost that the employer will incur in connection with the employment – this is the highest amount, because employer is oblige to pay some contributions on top of the gross amount stated in the contract.
The final employer cost is always higher than the gross salary amount stated in the contract, which shall be taken into account when establishing employee’s salary.
Example calculation
| EMPLOYMENT CONTRACT – GROSS SALARY PLN 8000 | ||
| NET SALARY (AFTER DEDUCTIONS) |
GROSS SALARY (IN THE CONTRACT) |
TOTAL EMPLOYER COST (AFTER ADDITIONAL PAYMENTS) |
| PLN 5783,91 | PLN 8000 | PLN 9 758,40* |
*including PPK contribution (PLN 120, from which employee may resign).
Gross salary vs. Net salary in Poland
An employee’s gross salary is the salary that the employer indicates in the employment contract. In Poland the contracts always contain gross monthly amount (we do not indicate annual earnings in the contract).
When hiring an employee on the employment contract the employer shall always operate with gross monthly salary. This amount allows him to calculate the net amount (after calculating necessary deductions) and calculate the total employer costs (after adding necessary contributions that are paid only by the employer).
The net salary can only be calculated after calculating deductions that has to be made from employee’s salary to:
- social security institution (ZUS)
- tax office.
It is important that the employer agrees with the employee on the gross salary, because the amount of net salary may be different every month (depending on the applicable tax threshold, paid or unpaid absences etc.).
Employers should always refer to the gross remuneration in the contracts, negotiations with employees and job advertisements.
If you already have a gross remuneration in mind, in order to calculate the net amount that the employee will receive, we encourage you to use our gross to net calculator.
NOTE: If you decide to hire an employee based on the employment contract, remember that a minimum wage applies. In 2025, it is PLN 4666 gross monthly.
What is the total cost for the employer in Poland?
In addition to the contributions and advances deducted from the employee’s salary, the employer is obliged to pay additional social security contributions. The economic burden of these contributions lies with the employer, this is why it is paid on top of the gross amount already agreed in the contract with the employee.
Contributions paid by the employer on top of the gross remuneration:
- Pension contribution – 9.76% of gross salary
- Disability pension contribution – 6.50% of gross salary
- Accident insurance contribution – 1.67% of gross salary
- Labor Fund contribution – 2.45% of gross salary
- Guaranteed Employee Benefits Fund (FGŚP) contribution – 0.10% of gross salary
- Employee Capital Plans (PPK) contribution – 1.50% of gross salary (this contribution applies only to employees who did not resign from this semi-private savings scheme).
Since these costs are paid in addition to the gross salary, they increase the total expense for the employer, which creates total employer cost.
Total employer cost in Poland – sample calculation
For a gross monthly salary of PLN 8,000, the total employer cost is as follows:
| TOTAL EMPLOYER COST – GROSS SALARY PLN 8000 | ||
| Contribution | Percentage of salary | Amount (PLN) |
| Pension Contribution | 9.76% | 780.80 |
| Disability Insurance Contribution | 6.50% | 520.00 |
| Accident Insurance Contribution | 1.67% | 133.60 |
| Labor Fund Contribution | 2.45% | 196.00 |
| Guaranteed Employee Benefits Fund | 0.10% | 8.00 |
| Employee Capital Plans | 1.50% | 120.00 |
| TOTAL SUM | – | PLN 1758,40 |
| TOTAL EMPLOYER’S COST (GROSS SALARY + TOTAL SUM) |
PLN 9758,40 | |
Employer’s and employee’s contributions
The following table illustrates the division of social insurance contributions between the employer and employee:
| CONTRIBUTION TYPE | PAID BY THE EMPLOYEE (DEDUCTED FROM GROSS SALARY) | PAID BY THE EMPLOYER (ADDED ON TOP OF THE GROSS SALARY) |
| Pension | 9.76% | 9.76% |
| Disability Insurance | 1.50% | 6.50% |
| Health Insurance | 9.00% | – |
| Sickness Insurance | 2.45% | – |
| Accident Insurance | – | 0.67% – 3.33% |
| Labor Fund | – | 2.45% |
| Guaranteed Employee Benefits Fund | – | 0.10% |
| Employee Capital Plans | 2.00 % | 1.50 % |
What are the costs of hiring employees on the contract of mandate?
A contract of mandate is a civil law contract which involves the contractor performing specific tasks or activities for the principal. It is usually used in case of hiring students or short-term cooperation. The contract of mandate is not subject to the regime of the Labor Code, therefore it gives the parties more freedom and creates less obligations for the employer.
If a person is employed on the basis of a contract of mandate, where the remuneration from this contract is their sole source of income, the total cost for the employer will be the same as in the case of an employment contract. This is due to the fact that such a person will be covered by the same social security contributions as in case of employment contract.
However, the net amount for such an employee is usually higher – this is due to the fact that employee’s contributions under contract of mandate are lower than on the employment contract. Therefore, a lower amount is deducted from the gross salary.
| MANDATE CONTRACT – GROSS SALARY PLN 8000 | ||
| NET SALARY (AFTER DEDUCTIONS) |
GROSS SALARY (IN THE CONTRACT) |
TOTAL EMPLOYER COST (AFTER ADDITIONAL PAYMENTS) |
| PLN 6 078,27 | PLN 8000 | PLN 9 638,40* |
*does not include PLN 120 for PPK contribution (to which the contractor may also join).
IMPORTANT: Please note that students under 26 years of age are exempt from paying social insurance contributions. This means that in their case, the employer will not pay contributions and the gross amount will also be the net amount and the total employer cost.
| MANDATE CONTRACT – GROSS SALARY PLN 8000 STUDENT UNDER 26 Y.O. |
||
| NET SALARY (AFTER DEDUCTIONS) |
GROSS SALARY (IN THE CONTRACT) |
TOTAL EMPLOYER COST (AFTER ADDITIONAL PAYMENTS) |
| PLN 8000 | PLN 8000 | PLN 8000 |
NOTE: If you decide to hire an employee based on a contract of mandate, remember that a minimum hourly wage rate applies. In 2025, it is PLN 30.50 gross per hour.
What is the cost of hiring an employee on a specific task contract?
A specific-task contract is a civil law agreement for achieving a defined result (e.g. creating a graphic design or report). It is not subject to the Labor Code, allowing both parties to freely determine the terms of the cooperation. Apart from contractual obligations, it does not create any significant statutory obligations on part of the employer. This is why the conclusion of such agreements is closely observed by authorities – the conclusion of such a contract must be reported to the Social Insurance Institution (ZUS).
A person concluding a contract for specific work is not subject to any social security contributions. Therefore, the net amount, the gross amount and the total employer cost will be the same.
| SPECIFIC TASK CONTRACT – GROSS SALARY PLN 8000 | ||
| NET SALARY (AFTER DEDUCTIONS) |
GROSS SALARY (IN THE CONTRACT) |
TOTAL EMPLOYER COST (AFTER ADDITIONAL PAYMENTS) |
| PLN 8000 | PLN 8000 | PLN 8000 |
However, there is an exception in which the payment of social security contributions is mandatory. This applies when a contract for specific work is signed between parties already bound by an employment contract. In other words, social security contributions must be paid if an employer enters into such a contract with an employee.
What is the cost of hiring an employee on a B2B contract?
A B2B contract is a civil law agreement concluded with a person who has registered as individual entrepreneur and conducts his/her own business activity. Such an agreement is intended for independent individuals, who usually provide specialized services based on their experience and knowledge (IT workers, lawyers, business consultants etc.).
This agreement is not subject to the Labor Code, allowing both parties to freely determine the terms of the cooperation. Apart from contractual obligations, it does not create any significant statutory obligations on part of the employer.
In case of a B2B agreement the contractor pays social security contributions and taxes on his own. Therefore, the parties agree only on a net amount that is shown in a B2B contract. In this case, net amount is also a total cost of the employer (there is no gross amount). If the parties of the B2B contract are VAT taxpayers is it added to the contractors invoice, however it does not create a cost for the employer (VAT is neutral and decreases his VAT payment).
| B2B CONTRACT – NET SALARY PLN 8000 | ||
| NET SALARY
|
TOTAL EMPLOYER COST | AMOUNT ON THE INVOICE |
| PLN 8000 | PLN 8000 | PLN 8000 + APPLICABLE VAT TAX RATE |
Key takeaways
Hiring an employee in Poland involves more than just paying a salary. Employers must also cover mandatory social security contributions, fund contributions, and tax obligations. The total cost depends on the employment type.
If you have any further questions or would like support in choosing the form of employment and its costs, please contact the specialists from our law firm’s labor law department at: [email protected] and our sister company DPG TAX, which provides accounting and HR services.
FAQ – Cost of hiring in Poland
What payroll taxes must employers pay in Poland?
Employers in Poland must calculate, deduct and pay social security contributions, as well as income tax advances. Social security contributions include: pension contributions (9.76%), disability pension contributions (6.50%), accident insurance contributions (1.67%), Labor Fund contributions (2.45%), and Guaranteed Employee Benefits Fund contributions (0.10%).
How to calculate the costs of employment?
Employers can use an employee cost calculator to estimate the true cost of hiring a new employee. The total employment costs is calculated by taking into account the gross salary and adding necessary contributions on top.
Can a business claim deductions for employee-related costs?
Yes, a business can claim deductions for some employee-related expenses, such as office space, retirement contributions, and interest on employment-related costs.
These deductions lower combined income and taxation obligations. Additionally, costs related to training, medical examinations, and protective clothing may be considered as tax-deductible for the company.
What is the FUTA tax rate equivalent in Poland?
In Poland, there is no direct equivalent to the FUTA tax rate used in the U.S. However, employers must contribute to the Labor Fund (2.45%), which serves a similar function to the state unemployment tax. These contributions support unemployment benefits and are managed by the Zakład Ubezpieczeń Społecznych (ZUS).
Who pays social security contributions and taxes?
In case of employees hired based on employment contracts and contracts of mandate it is employers obligation to calculate and pay contributions each month to relevant authorities (ZUS and local tax office).
Only contractors hired based on B2B contracts pay their social security premiums and tax advances on their own.
Where the employer pays the social security contributions?
In Poland, social security issues connected to employment are managed by Zakład Ubezpieczeń Społecznych (ZUS), which oversees social security benefits, including retirement and health insurance contributions. Employees need to be registered by the employer in ZUS within 7 days from the start of employment. The company is registered in ZUS along with the first employee.
What is the most cost effective form of employment in Poland?
The cheapest form is a civil-law contract, especially a B2B contract, where the employer is not obliged to pay social security premiums. However, concluding such a contract is not possible in all cases. It requires the contractor to conduct his own business activity and have a high level of independence while performing duties.
What is the most expensive form of employment in Poland?
The most expensive form of employment is employment contract. In case of this form of employment the employer has to pay additional social security contributions, which increase his total costs. However, this form provides both parties with the most stability and form a lasting relationship between the parties. This is why, although the most expensive, it is also the most popular and most desirable form of employment in Poland.
