In recent years, the minimum wage for people employed on a contract basis in Poland is growing more dynamically than the average wage

In recent years, the minimum wage for people employed on a contract basis in Poland is growing more dynamically than the average wage. While the minimum wage in 2016 amounted to 1850 zl. gross, in 2017 it was raised to the round sum of 2000 zl. As the government has announced, in 2018 the upward trend should continue and the minimum wage is set to be raised once again. On the basis of the ORDINANCE OF THE COUNCIL OF MINISTERS of September 12, 2017 on the minimum wage and the minimum hourly rate in 2018 in Poland, starting from January 1, 2018, the minimum remuneration will be set at 2100 zl gross.

The Minister of Family, Labour and Social Policy justified another big increase for the lowest earners by citing the dynamic growth of GDP and the good economic situation of the country, which should translate into a better standard of living for employees. The purpose of the increase is to reduce the gap between the minimum and average salaries. At present the minimum wage represents 47% of the average wage, while the plan of the government is to achieve a value of 50%.

The minimum hourly wage rate will change in 2018 as well

Following the increase in the minimum monthly wage, the minimum hourly wage rate in Poland, which has been set at 13 zl since the start of 2017, will also increase. As of January 1, 2018, a minimum hourly rate of 13.70 zl will be set. The minimum hourly rate applies to contractors and self-employed individuals. It will not, however, apply to people who decide on the place and time of work themselves, and who receive a commission fee for such work. The minimum hourly rate also does not apply to entrepreneurs who utilize the work of third parties as part of a service contract.

In so far as the lowest earners will certainly be happy with the increases announced for 2018, they are not good news for entrepreneurs, who will have to cover the costs of increased social security contributions. This is often the biggest cost for many companies, especially for the smaller ones that have between one and a few employees.