An Employer of Record (EOR) is a third-party organization that takes on the legal and administrative responsibilities of employing workers on behalf of another company. The EOR handles payroll, benefits, taxes, and compliance with local labor laws, allowing businesses to hire and manage employees in Poland without establishing their legal entity.
Hiring workers from Poland offers several benefits due to the country’s highly educated workforce and strategic location in Europe. Poland is currently Europe’s leading outsourcing hub because of low personnel costs. It is the only European country that successfully avoided recession during the 2008-2009 global financial crisis. The workforce in Poland has all the essential ingredients to make good employees – they are ambitious, hard-working, loyal, and eager to learn with an entrepreneurial mindset.
According to recent data, Poland’s labor market continues to evolve, with a growing emphasis on technology and service sectors. The country is ranked as the 6th most populous member state of the EU, with seven out of ten tertiary-educated adults holding a master’s degree. This highlights the highly skilled and educated workforce available in Poland.
To effectively use an Employer of Record in Poland, follow these 6 steps:
- Find talent to hire in Poland
- Compare using an EOR to setting up a legal entity in Poland
- Get the information needed from your talent
- Choose an EOR provider with expertise in Poland
- Communicate your hiring needs to the EOR
- Have the EOR set up the contracts and hiring procedure
An EOR in Poland manages payroll processing, ensures compliance with tax regulations, and administers statutory benefits such as social security contributions and leave entitlements. They also handle the complexities of Polish labor laws, including working hours, overtime pay, and termination procedures.
When hiring remotely in Poland, it’s crucial to consider various labor laws. The country has protective employment regulations, including strict rules on employment contracts, working hours, and paid time off. Poland mandates a 40-hour standard work week, with overtime pay required for additional hours. Employees are entitled to a minimum of 20 days of paid vacation time per year, which increases to 26 days after 10 years of employment.
The hiring process in Poland typically involves identifying suitable candidates, conducting interviews, and ensuring compliance with local employment laws. Employment contracts must be in writing and include specific details such as job responsibilities, working hours, and compensation. The EOR facilitates this process, ensuring all legal requirements are met and managing the onboarding of new employees.
1. Find talent to hire in Poland
To find talent to hire in Poland, businesses should explore a variety of channels, emphasizing both local and global platforms to maximize reach. While LinkedIn isn’t as popular a hiring platform in Poland as in other countries, it can still be a useful tool for professional networking and talent acquisition.
Job posting websites like Pracuj.pl, OLX.pl, and GoldenLine are popular local job portals in Poland. These platforms offer avenues for employers to advertise openings and are widely used by Polish job seekers. Employers can post their candidate requirements on these portals, allowing applicants to access them remotely.
Specialized recruitment agencies can provide tailored solutions for industries requiring specific expertise, particularly IT and engineering. These agencies manage the complexities of sourcing and vetting candidates, significantly easing companies’ hiring processes.
Local job boards and regional networks can be advantageous for businesses hiring within specific industries or for particular roles. Poland’s diverse economy offers a wide range of talent across various sectors, with Krakow and Warsaw being particularly notable for their deep talent pools, producing 40,000 and 59,000 graduates yearly, respectively.
It’s important to note that in Poland, the hiring process often begins with drafting a detailed job description, followed by screening, shortlisting, interviews, and selection. Some roles may require candidates to pass a written test as part of the evaluation process.
2. Compare using an EOR to setting up a legal entity in Poland
When working with employees in Poland, you need to consider working with an EOR versus setting up your legal entity. Here’s a comparison of the two options:
| Factor | Employer of Record | Setting Up Legal Entity |
|---|---|---|
| Setup Time | Quick, often within days | Up to 6 months |
| Initial Cost | Lower upfront costs | Higher, includes registration fees |
| Ongoing Cost | May become costlier with more employees | More cost-effective for larger teams |
| Complexity | Simpler, EOR handles most administrative tasks | The company is responsible for all compliance |
| Control over Operations | Limited control, EOR is the legal employer | Full control over all aspects of employment |
| Compliance Management | Handled by EOR | Significant local expertise is needed |
| Scalability | Easier to scale up or down quickly | Requires more time and resources to scale |
| Local Expertise Required | Minimal, provided by EOR | Higher, the company bears all legal risks |
| Suitable for | Testing markets, small teams, short-term projects | Long-term expansion, large teams |
| Risk | Lower, EOR assumes legal liability | The company must handle directly |
| Customization of Employment Terms | Limited flexibility | Full flexibility to tailor policies |
| Termination Process | Managed by EOR | Company must handle directly |
An Employer of Record offers a quicker, less complex route to hiring local staff, bypassing the need for a formal company presence. This approach suits companies looking to test the Polish market or expand quickly without significant upfront investment.
On the other hand, setting up a legal entity in Poland offers greater control and the ability to customize business operations and policies. However, establishing a legal entity involves complex registration processes, significant upfront fees, and a deeper understanding of local laws and tax regulations.
In comparison, using an EOR is generally less expensive. It involves less risk, making it a suitable option for small to medium-sized businesses or those in the initial stages of market exploration. It eliminates the need for a local expert or dedicated legal and tax teams, as the EOR handles these aspects.
3. Get the information needed from your talent
You’ll need to collect essential personal information and employment details to hire employees in Poland. This typically includes:
- Employee’s full name
- Address
- Date of birth
- Polish Identification Number (PESEL) or passport details for foreign nationals
- Bank account details for salary payments
- Comprehensive job description, including title, duties, and place of work
Employment contracts in Poland must be in writing and should detail the terms of employment, such as:
- Type of contract (fixed-term, indefinite, etc.)
- Start date
- Job title and responsibilities
- Working hours and place of work
- Remuneration details
- The notice period for termination
- Information about collective agreements, if applicable
It’s important to note that in Poland, collecting this data before the employee starts working is crucial for compliance with local labor laws and regulations, including social security registration.
The Polish labor code requires employers to inform new hires about the rights and obligations of both parties (the employment relationship), remuneration, probation period, and other relevant details within 7 days of the employment start date.
4. Choose an EOR provider with expertise in Poland
When choosing an EOR provider to work with in Poland, selecting one with deep expertise in the Polish market and a strong understanding of local labor laws is crucial to ensure compliance and smooth business operations.
Evaluate the provider’s experience managing employee onboarding, payroll, and legal compliance in Poland. Look for a provider with a proven track record of working successfully with companies similar to yours, and check their reputation through client case studies or reviews.
Assess the range of services offered to see if they align with your needs, such as work permit support, employee benefits management, and payroll processing. Choosing a provider that offers comprehensive employment services and is flexible enough to adapt to changes in Polish labor laws is important.
Consider the provider’s technology and platforms, ensuring they offer secure, user-friendly systems with strong data protection measures. This is particularly important in Poland, where data protection is covered by the European Union’s General Data Protection Regulation (GDPR).
Evaluate their pricing models, looking for transparency in fees, whether they charge a fixed monthly fee or a percentage of the employee’s salary, and assess the cost-effectiveness for your business.
Finally, choose an EOR provider that demonstrates a commitment to staying up-to-date with Polish employment laws and can provide proper guidance and support to ensure your business remains compliant while operating in Poland.
What are the best EOR providers to use in Poland?
| EOR Provider | Why Selected |
|---|---|
| Deel | Offers comprehensive global hiring solutions with strong presence in Poland |
| Remote | Specializes in compliant hiring and payroll management in European countries, including Poland |
| Rippling | Provides integrated HR, IT, and Finance solutions suitable for Polish operations |
| Oyster HR | Specializes in compliant hiring and payroll management in European countries including Poland |
| Multiplier | Offers tailored EOR services with expertise in Polish labor laws and regulations |
5. Communicate your hiring needs to the EOR
Communicating your hiring needs to the EOR to ensure the process aligns with company goals and legal requirements is important. Provide a detailed job description, including title, responsibilities, required qualifications, and skills.
Specify the job’s expected start date, location, and whether it’s remote or onsite. Outline the proposed salary, bonuses, commission structures, and other compensation benefits. Clarify the contract length, whether permanent or fixed-term and detail the working hours, including any flexibility or shift requirements.
Discuss the company culture, growth plans, and how the position fits into future expansion. Specify equipment needs and onboarding procedures. By accurately representing these aspects, the EOR can find the right talent and ensure legal and administrative compliance.
Additionally, communicate any specific requirements related to Polish labor laws, such as the need for social security registration or any industry-specific regulations that may apply to your business. It’s also important to discuss any specific benefits you want to offer, as the EOR can help you design a competitive package that complies with local norms and regulations.
6. Have the EOR set up the contracts and hiring procedure
Once you have chosen which provider to work with and communicated your hiring needs, the EOR will set up the contracts and hiring procedure, ensuring compliance with local labor laws and employment practices.
The EOR will draft employment contracts that adhere to Polish labor laws, including specific terms regarding job details, working hours, and termination procedures. They’ll manage the necessary documentation for tax, social security, and payroll setup, adhering to mandatory withholdings and reporting requirements.
The EOR also registers employment with relevant Polish authorities, such as the Social Insurance Institution (ZUS), to ensure the company is properly licensed and authorized to operate and hire employees in Poland.
They’ll ensure your company complies with local regulations related to working hours, minimum wage, and leave entitlements. Additionally, the EOR administers benefits and handles formal onboarding, including the introduction to company systems and culture.
The EOR will also ensure that all necessary paperwork is completed, including registering the employee for social security and health insurance purposes. They will set up payroll systems to ensure timely and accurate payment of salaries and statutory contributions.
What help does an EOR provide in Poland’s payroll, taxes, and benefits administration?
The EOR will support all of Poland’s payroll, taxes, and benefits administration, ensuring compliance with complex local laws. It calculates and processes employee salaries, withholds the correct tax amounts, and handles social security contributions.
The EOR manages payslips that reflect mandatory withholdings for income tax and social security contributions, adhering to Polish regulations. It files monthly and annual tax returns with Polish authorities, including the National Revenue Administration, and manages other required reporting.
For benefits, the EOR ensures compliance with statutory requirements, such as annual, sick, and maternity leave. It can also administer additional common benefits in Poland, such as private health insurance or annual bonuses.
The EOR also calculates and pays mandatory contributions to the Employee Capital Plans (PPK), a long-term savings program introduced in Poland in 2019.
Specific tasks include:
- Calculating and withholding personal income tax (PIT) at rates ranging from 12% to 32% based on income levels
- Managing social security contributions, including pension, disability, sickness, and accident insurance
- Handling contributions to the Labor Fund and the Employee Guaranteed Benefits Fund
- Ensuring compliance with the minimum wage requirements, which are subject to annual increases
- Administering the 13th-month salary or annual bonus, which is customary in Poland
What labor laws do you need to consider when hiring in Poland?
When hiring in Poland, several key labor laws must be considered. Poland’s approach to labor laws generally protects employees, offering extensive employee protections considered more stringent than those in many other countries.
Employment contracts
Employment contracts in Poland must be in writing and specify job details, including position, duties, working hours, salary, and termination conditions. There are three main types of employment contracts:
- Trial period contract (up to 3 months)
- Fixed-term contract
- Indefinite-term contract
Working hours and paid holidays
The standard work week in Poland is 40 hours, typically spread over 5 days. Overtime is permitted but limited to 150 hours per year and must be compensated at a higher rate.
Employees are entitled to a minimum of 20 days of paid annual leave per year, increasing to 26 days after 10 years of total employment. There are also 13 paid public holidays annually.
Taxes
Personal income tax in Poland is progressive, with rates of 12% and 32% depending on income levels. Employers are responsible for withholding and remitting these taxes.
Social security contributions are shared between the employer and employee, with the employer typically contributing about 20% of the employee’s gross salary.
Severance pay
Due to reasons not attributable to the employee, severance pay is required in group layoffs or individual terminations. The amount depends on the employee’s length of service:
- Less than two years: 1 month’s salary
- 2-8 years: 2 months’ salary
- Over eight years: 3 months’ salary
| Labor Law | Key Points |
|---|---|
| Employment Contracts | Must be written, specifying job details and conditions |
| Working Hours | 40-hour standard work week, overtime limited and compensated higher |
| Paid Holidays | Minimum 20 days annual leave, 13 public holidays |
| Taxes | Progressive income tax, shared social security contributions |
| Severance Pay | Required for certain terminations, based on length of service |
How does the hiring process work in Poland?
When hiring staff in Poland, employers typically follow these steps:
- Identify the vacancy and create a detailed job description
- Advertise the position through various channels, including local job portals like Pracuj.pl and OLX.pl
- Review applications and shortlist candidates
- Conduct interviews and assessments, which may include written tests for some roles
- Select the preferred candidate and make a job offer
- Negotiate and finalize the employment terms
- Prepare and sign the employment contract
- Complete necessary paperwork, including social security registration
- Onboard the new employee
Employers must ensure compliance with Poland’s labor laws and regulations throughout this process, including anti-discrimination legislation and data privacy requirements. It’s also important to be aware of cultural nuances in the Polish hiring process, such as the importance of formal education and qualifications.
Employers should also be prepared to discuss benefits beyond the statutory requirements, as Polish employees often expect additional perks such as private healthcare, language courses, or fitness memberships.
Is Poland a relatively easy country to hire employees remotely through an EOR?
Yes, Poland is generally considered a relatively easy country to hire employees remotely through an Employer of Record. The country’s well-developed legal system, growing economy, and skilled workforce make it an attractive destination for international hiring.
Pros
Cons
Poland’s labor laws, while protecting employees, are clear and well-established, making compliance manageable with the help of an experienced EOR. The country’s improving digital infrastructure facilitates remote work arrangements, especially in urban areas.
However, it’s important to note that while hiring through an EOR in Poland is relatively straightforward, employers must still be mindful of local labor laws and cultural nuances. An experienced EOR can navigate these requirements effectively, ensuring compliance while simplifying the hiring process for foreign companies.
In conclusion, Poland’s combination of a skilled workforce, favorable business environment, and established legal framework makes it a viable option for companies hiring remote employees through an EOR, provided they partner with a knowledgeable and experienced EOR provider.
