New minimum wage rates as of July 1!

January 2024 proved to be a crucial moment for workers in Poland. That’s when a record increase in the minimum wage took place, rising from 3,600 zlotys gross to 4,242 zlotys.

This was in accordance with the Decree of the Council of Ministers of September 14, 2023 on the minimum hourly rate for 2024.

Another increase starting July 1

However, this is not the end of the good news. As of July 1, the minimum wage will increase to 4,300 PLN gross (3261.53 PLN net), which means an additional 58 PLN gross. Compared to July 1, 2023, this means an increase of as much as PLN 700. The new hourly rate is also gaining ground and will be PLN 28.10 gross (PLN 22.07 net) as of July 1.

Keep in mind that these amounts may vary depending on your individual tax threshold and applicable deductions, but they provide a concrete benchmark for the upcoming fiscal year.

These changes are an indispensable part of the payroll strategy in almost every company. Therefore, it is necessary to find a balance between legislative requirements and optimization of the company’s operating costs.

Other benefits will also increase

The change in the minimum wage has wide-ranging implications that also include other benefits and compensation under labor law. This is particularly important for managers and HR departments.

The amount of the minimum wage affects:

• allowance for night work,
• The maximum amount of severance pay for mass layoffs,
• The basis for calculating sickness benefits,
• minimum amount of compensation for violation of the principle of equal treatment in employment,
• the amount free of bailiff deductions.

July increase – unnecessary fuss or positive change?

While most employees are happy to see higher salaries, it is worth considering the cost of implementing the increase. These changes mean the need to annex contracts, adjust accounting systems and additional work for HR departments. This, in turn, is directly related to additional costs for businesses.

What is the opinion of experts?

The salary increase is also a signal for employees to start talking about further increases. In the current economic climate, many entrepreneurs are unable to meet such demands. Especially since many companies are struggling with a deteriorated condition, and the holiday season often means a slowdown in many sectors of the economy.

Experts point out that frequent increases can create more confusion than benefits. Many say that adjusting salaries twice a year is unnecessary and burdens employers with additional accounting duties.

What are the forecasts for the next year?

Fortunately, forecasts for next year are more predictable. The Ministry of Family, Labor and Social Policy plans a one-time increase in the minimum wage in January, to PLN 4626 gross.

Will these changes be beneficial? Time will tell, but one thing is certain – they introduce new challenges for both employees and employers.