In Poland, group life insurance is the number one benefit people care about. Individual life insurance is not common, and group life insurance is the only life cover they have. When asked to rank two other common benefits in order of importance, the average Polish employee will likely respond with: Medical and Retirement.
The aging population makes retirement planning very important, however, that is not the only reason that this issue is popular amongst employees. As a matter of fact, 75% of employees do not have a retirement plan in place!
The average monthly cost for a typical benefits package is 150 Zloty per month or about $US38.
Mandatory employee benefits in Poland include pension (PPK), social insurance, and occupational medicine (OM). Supplementary employee benefits in Poland include private medical insurance, life insurance and business travel insurance. Employee perks include gym memberships and subsidizing employees education.
Mandatory Employee Benefits in Poland
Since 2019, pension is mandatory for all employers in Poland. The new law is called Employee Capital Plan (PPK) and was introduced by The Polish Government to increase savings of the local nationals.
The PPK rollout is in 4 phases depending upon number of employees and is in 2 parts:
A) Company signs agreement with PPK vendor;
B) Company signs agreement to operate PPK on behalf of employees.
Contributions begin after 2nd agreement is signed.
The 2020 PPK Act rollout schedule has been amended for Phase 2 companies due to Covid – 19. The schedule below is as of April 2020:
Phase 1: Companies with 250+ employees July 1 2019
Phase 2: Companies with 50+ employees (as of June 30, 2019) Part A deadline: January – Oct 27, 2020; Part B deadline: Nov. 10, 2020.
Phase 3: Companies with 20+ employees (as of Dec 31, 2019): Part A deadline: July 1, 2020 – Oct. 27, 2020; Part B deadline: Nov. 10, 2020
Phase 4: All other companies: Part A deadline: Jan. 1, 2021 – April 23, 2021; Part B deadline May 10, 2021
Employees between 18 and 55-year-old will be enrolled automatically and they have the option to opt out (opt out forms must be delivered to employee in hardcopy.)
Contributions to PPK are paid from three sources: the employer (min 1,5% of gross salary), the employee (min 2% of gross salary) and the State (welcome package in amount of 250 PLN and annual subsidy in amount of 240 PLN).
The Polish social insurance system includes: old-age pension insurance, disability and survivors’ pension insurance, sickness insurance, work accident insurance. In general, this system does not enable a minimum of resources for people who become disabled during their working lives.
Due to disability/as a result of inability to work, an employee receives a pension. It is the basic benefit, in very small amount – not sufficient for ensuring a minimum standard of life.
Children of an employee who died, can count on a pension after a death of a parent, if a parent was insured in the Polish social security system. Such pension is in very small amount as well.
Maternity and paternity leave is covered from the social insurance. Short term disability is covered up to 180 days in a calendar year by the state insurance as well.
Occupational Medicine (OM)
Do you know that each employer should provide his/her employees with obligatory Occupational Medicine examinations? The Occupational Medicine preventive examination involves tests to determine an employee’s individual predispositions to work in a specific position under certain conditions. In this regard, account is taken of any harmful and onerous factors in a given working environment.
Preliminary examination – the following persons are referred: (1) new employees prior to the commencement of work, (2) employees who have changed their position, (3) employees whose job profile has been changed – where new risks emerge.
Periodic examinations – the following persons are referred: persons already working in a given position prior to the end of validity of their previous certificate.Follow-up examinations – the following persons are referred: each Employee who was on a sick leave for more than 30 days; the Employee should undergo the examinations to obtain a medical certificate prior to re-commencement of work.
Supplementary Employee Benefits in Poland
Private Medical Insurance
The public health care is free of charge but is also inefficient and viewed as a poor quality. Waiting period for the specialist consultations may take few weeks or several months (depends on type of specialist). Waiting period for the advanced diagnostic may take few weeks or even several months (depends on type of diagnostic). That is why the private medical care is the most common benefit in Poland. The majority (over 85%) of the employers in Poland offer such benefit to the employees.
Group Life Insurance
Group risk insurance is the second most popular employee benefit among the Polish employees. There are two types of the group life insurance:
- The “compulsory” scheme, where the premium for the insurance is covered by the employer. The sums insured are either fixed or salary based. Scope of the cover is limited to few riders.
- The “voluntary” scheme, where the premium for the insurance is covered in full by the employee and deducted from the salary of the employee. The sums insured are almost always fixed, but relatively low. The scope of the cover is however very wide and included typical to the Polish market family benefits (benefits are paid in case of death of the spouse, death of the parents/ parents in-law, birth of the child, critical illness of the dependents).
For the bigger companies it is common to have both compulsory and voluntary schemes in place at the same time. Disability insurance (total and permanent disability (any reason) and total partial disability due to accident) is part of the group life insurance plan as supplemental agreement.
Business Travel Insurance
Although the business travel insurance is not mandatory, the most (95%) of companies offer business travel insurance. According to the Polish law, employer who delegates employees abroad is obliged to cover the costs of the medical treatment which occur abroad including the costs of medicines and transport. Obviously the BTA cover is cheaper solution.
Employer supported gym membership is very common benefit in Poland. Most companies (89%) subsidize or pay for employees’ education, training, or language course costs.
Flexible benefits are not common on the Polish market. Only ¼ of all employers offer such solution.
This information about employee benefits in Poland is provided by MAI CEE, Asinta’s employee benefits consulting partner in the Poland.