Minimum remuneration in Poland in 2024

Minimum remuneration in Poland in 2024
Marek Cieślak

Marek Cieślak

CEO CGO Finance

One of the main elements of the employment relationship is undoubtedly remuneration. Every worker has the right to a living wage. Its minimum amount is guaranteed by the legislator. What will be the minimum remuneration in Poland in 2024? How will it change? Find out from the article below. We invite you to read.

Table of Contents

What is the minimum remuneration in Poland?

The minimum salary is a statutorily defined, lowest permissible amount of monthly remuneration for work. It is indicated in the form of a rate or minimum earnings for work in the applicable time frame. The obligation to determine it arises from the Constitution of the Republic of Poland. The Act of 10 October 2002 on the minimum salary defines the rules for its establishing.

A clearly defined lower limit of a full-time worker’s salary influences the stability of employment. Therefore, a salary below the statutory value is a violation of employees’ rights.

The minimum salary serves as the basis for determining other benefits for employees. This refers for example to:

  • supplement to the salary in the amount of 20% of the hourly rate resulting from the minimum salary,
  • compensation for downtime (cannot be lower than the minimum salary),
  • the amount of severance payment for group layoffs. (It cannot exceed 15 times the minimum salary).

The value of the minimum salary is the basis for determining the value of social insurance contributions paid by new entrepreneurs. Preferential rates applicable in the first 24 months are calculated from the basis equal to 30% of the minimum salary.

What determines the amount of the minimum remuneration in Poland?

The initial amount of the minimum remuneration is determined based on data concerning the projected inflation for the next year. If the remuneration salary is lower than half of the national average, it is also based on the data determining 2/3 of the actual economic growth. The increase in the minimum salary can be higher than the statutory minimum.

Principles of determining the minimum remuneration in Poland

The value of the minimum remuneration is subject to annual negotiations within the framework of the Social Dialogue Council (SDC). It is an organization that brings together representatives of employers, employees, and authorities. The Council of Ministers presents the SDC with a proposal for the amount of the minimum salary for the next year by 15 June of each year. It also suggests the implementation date of the proposed change. Moreover, it presents additional relevant data. They concern the forecasted real GDP growth rate and average salary in the first quarter of the year in which negotiations take place. The Council also provides information on:

  • the price index in the previous year,
  • price index and average salary forecasted for the next year,
  • household expenditures in the previous year
  • indicator of the share of income from contract work and the average number of dependents of a contract worker in the previous year,
  • the amount of average monthly salary in the previous year by type of business activity,
  • the living standard of different social groups,
  • the economic conditions of the country, including the condition of the state budget, the requirements of economic development, the level of labor productivity, and the need to maintain a high level of employment.

After receiving the proposal for the minimum remuneration and the complete set of information from the Council of Ministers, the SDC agrees on the minimum value. The decision is issued within 30 days from the day of receiving all the data. The final amount is published in the Polish Monitor, by way of an announcement of the Prime Minister’s decision. It must be done by the 15th of September each year.

If the SDC does not agree on the amount of the minimum remuneration for the following year within the above-mentioned period, the Council of Ministers establishes it through regulation. This must be done also by September 15th of each year, along with the proposed date of implementation.

According to the legislator’s assumption, if the forecasted price index for the next year, i.e. the average annual price index for consumer goods and services as a whole adopted for the preparation of the draft budget act, is at least 105%, then two dates for changing the minimum salary and the minimum hourly rate are indicated:

  • the 1st of January
  • the 1st of July

The salary is affected, among other things, by working hours. How to determine them? Find out from this article.

What will be the value of minimum remuneration in Poland in 2024?

The current draft regulation of the Council of Ministers on the minimum salary assumes that the average minimum in 2024 should not be lower than the statutory minimum, i.e. 4,270.60 PLN gross. It provides for two dates for the increase in the minimum salary:

  • from 1 January 2024 – 4242 PLN
  • from 1 July 2024 – 4300 PLN.

The thresholds set in this way will result in the average minimum salary in 2024 amounting to 4271 PLN. This amount will increase in relation to 2023 by 642 PLN gross in January 2024. Then, by 700 PLN gross in July 2024.

Setting the minimum salary in 2024 is linked with the need to determine the minimum hourly rate for work. According to the proposed regulation of the Council of Ministers, it will be:

  • 27,70 PLN from 1 January 2024
  • 28,10 PLN from 1 July 2024

Settlement of the minimum remuneration in Poland in 2024

The planned salary increase means that from 1 January 2024, the monthly salary of an employee will be no less than 3191.98 PLN net. From 1 July 2024, it will increase to 3231.53 PLN net.

The increase in the minimum salary will affect the amount of contributions to the Social Insurance Institution (ZUS). In the first half of 2024, they will amount to a total of 401.90 PLN. This value includes contributions for:

  • pension 248.40 PLN,
  • disability pension 101.08 PLN,
  • accident insurance 21.25 PLN,
  • sickness insurance 31.17 PLN,

Consequences of changes in the minimum remuneration in Poland in 2024

The planned salary increase will certainly lead to an increase in:

  • financial security for workers,
  • state care for workers,

Among the less positive aspects, one can highlight, for example:

  • possible reduction in the number of employees hired by micro-entrepreneurs,
  • increased costs for employers,
  • likelihood of job automation for savings,
  • the risk of a decrease in the quality of work among experienced employees due to the flattening of remuneration resulting from the increase in the minimum salary,
  • difficulties in the smooth functioning of many industries due to high operating costs, e.g., in the construction industry.

The minimum remuneration in Poland in 2024 – summary

Determining the amount of the minimum salary is a crucial element of a properly functioning state. This is why, the procedure takes place annually and analyses various factors.

If you are interested in the above article and want to know more about the subject, we invite you to cooperate with us. Our experts are at your disposal. Contact us today and let us help you!

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Marek Cieślak

CEO CGO Finance