How much does it cost to hire an employee in Poland?

Updated: 25.03.2025

Hiring an employee in Poland involves more than just completing the necessary formalities. Employers must first decide on the structure of employment and the appropriate type of contract. Each employment form entails different costs, which must be carefully considered. This guide outlines the costs associated with employment contracts, contracts of mandate, and specific-task contracts in Poland.

What are the costs of employing a worker under an employment contract in Poland?

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.

It is also important to note that some employment-related expenses may be tax-deductible, impacting the employer’s taxable income.

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.
• Net salary – the salary that the employee will receive in their bank account after mandatory deductions;
• Total employer cost – the final cost that the employer will incur in connection with the employment.

The final employer cost is always higher than the gross salary amount stated in the contract. This is because part of the employment costs rests solely with the employer and is not deducted from the employee’s salary.

Gross salary vs. Net salary in Poland

An employee’s gross salary is the salary that the employer includes in the contract. In Poland, it is expressed in monthly amounts.

When determining the gross salary, the employer should calculate the net salary that the employee will receive after contributions have been paid, as well as calculate the total cost of employment. The employer usually determines the gross salary based on their own budget, the employee’s qualifications and the average market salary for the position in question.

The net salary is the amount that the employee will receive in their bank account after the employer makes the appropriate deductions for the Social Insurance Institution and the tax office.

The amount of salary paid may be different every month. It is influenced by various factors, such as the amount of tax paid (after exceeding the tax threshold of PLN 120,000, the employee pays a higher tax), as well as factors related to the employee’s situation (e.g. the fact that they are on sick leave in a given month).

Therefore, employers should always refer to the gross amount that will be stated in the contract in conversations with employees and job advertisements. Otherwise, this can create unjustified expectations on the part of the employee

In order to correctly calculate the net amount, we encourage you to use our gross to net calculator.

What is the total cost for the employer in Poland?

In addition to the contributions and advances deducted from the employee’s wages, the employer is obliged to pay additional amounts for social security contributions. The economic burden of these contributions lies with the employer, which means that the employer “contributes” to the gross amount agreed in the contract.

Employer contributions:

• 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

Since these costs are paid in addition to the gross salary, they increase the total expense for the employer.

Total employer cost in Poland – sample calculation

For a gross monthly salary of PLN 8,000, the total employer cost is as follows:

Distribution of the burden of contributions from the employment contract between the employer and the employee in Poland

The following table illustrates the division of social insurance contributions between the employer and employee:

What are the costs of employing a worker on a contract of mandate in Poland?

A contract of mandate is a civil law contract which involves the contractor performing specific tasks or activities for the ordering party. This contract is not subject to the regime of the Labor Code, therefore it gives the parties more freedom and is less of a burden for the employer.

If a person is employed on the basis of a contract of mandate, where the remuneration is their sole source of income, the costs incurred by 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 compulsory social and health insurance and contributions to the Labor Fund and the Guaranteed Employee Benefits Fund.

If a contractor works on the basis of several contracts simultaneously, they are only subject to compulsory social insurance for one contract, usually the one that was concluded first.

However, subsequent contracts for this person may be exempt from social security contributions if they receive at least the minimum monthly wage for the first or other specified main contract. In this case, the employer only pays the gross wage.

IMPORTANT: Please note that students under 26 years of age are exempt from paying insurance contributions. This means that in their case, the employer will not pay contributions and the gross amount will also be the net amount.

If the employer decides to hire an employee based on a contract of mandate, they should also remember that in this case a minimum hourly wage rate applies. In 2025, it is 30.50 PLN 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 determine their terms freely. However, the contract must be reported to the Social Insurance Institution (ZUS).

A person concluding a contract for specific work is, in principle, not subject to social security, health insurance (for example, pension insurance) or contributions to funds. The contractor of the work is not obliged to pay these contributions.

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 or if an employee contracts with another entity to perform work for their employer.

Cost differences between employment types – sample calculation in Poland

The table above shows that the costs incurred by the employer are the same for both employment contracts and civil law contracts. However, the employee’s net salary will be higher with a contract of mandate.

Moreover, the exceptions described above should be taken into account (e.g. student under 26 years of age, several contracts of mandate, other source of income).

A contract for a specific work, on the other hand, is the only form of employment that is exempt from the obligation of the employer to pay contributions to the Social Insurance Institution (ZUS). Therefore, it seems that this is the cheapest form of employment for the employer, although it involves the greatest risk of inspection by the Social Insurance Institution (due to the necessity of reporting the conclusion of such a contract and exemption from contributions).

The table below shows the total costs incurred by the employer for a salary of PLN 8,000 gross per month, depending on whether the employee is employed under a contract of employment, a contract of mandate or a contract for specific work.
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Costs incurred by the employee

Part of the employment costs is borne by the employee. The gross salary is the amount from which various contributions and taxes are deducted, leading to the net salary that is paid to the employee. The table below shows examples of costs incurred by the employee for a gross monthly salary of PLN 8,000.

The costs for an employee are higher when working on a contract for services than on a contract for work, which means the employee receives a lower net wage.

Only income tax is deducted from the wage on a contract for work. This type of contract is not subject to social security contributions, sickness insurance or health insurance.

What is the minimum wage in 2025 in Poland?

To ensure fair wages, Poland enforces a statutory minimum wage. In 2025, the rates are:

• Minimum gross salary (employment contract): PLN 4,666 per month
• Minimum hourly wage (contract of mandate): PLN 30.50 per hour

Other employer costs

When hiring an employee under an employment contract, the employer must remember to comply with labor law regulations and the obligations imposed on them. The costs that will be incurred include:

• the cost of periodic medical examinations of employees,
• compensation for overtime work,
• remuneration for time of incapacity for work (for the first 33 days, later the Social Insurance Institution pays sickness benefit),
• costs related to the maintenance and storage of employee records,
• or costs related to personnel services.

These types of costs are much lower or non-existent in civil law contracts (e.g. no medical examinations).

The employer must also remember that he is not only a payer of insurance contributions or funds, but also of personal income tax advances. The employer is obliged to calculate the employee’s salary and pay the tax to the tax office by the 20th day of each month.

Tax-Deductible employer costs

In fact, employer benefits are tax-deductible for the employer, which means that the entrepreneur can reduce his own tax base by them.

The following costs can be deducted by the employer:

• wages,
• overtime pay,
• premiums and bonuses for night work,
• expenses for the purchase of work and protective clothing,
• preventive and regenerative meals,
• expenses for the purchase of prescription glasses,
• costs related to the organization of special and integration events in the company,
• expenses for setting up a company nursery, children’s club or kindergarten
• expenses for employee training.

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