An employee has a right to fair remuneration for work. However, the legislation does not define this concept. According to the dictionary meaning, “fair” is another word for just, fair, honest, decent. According to the legislator, the conditions for the realisation of the right to fair remuneration are determined by the labour legislation and the state policy in the field of wages, in particular by setting a minimum wage. Remuneration is due for work done.
There should be equal pay for equal work, and a breach of this principle can end up in charges of discrimination. The problem is that each employee works differently, so there are greater or lesser differences between employees, which can be used to differentiate pay. In addition, wage differentiation based on seniority is allowed.
The employer’s primary obligation is to pay wages and other benefits to which employees are entitled, such as travel allowances. In doing so, it is important to note that an employee may not waive his or her right to remuneration or transfer this right to another person.
The employer must pay wages at least once a month, on a fixed and predetermined date. Wages payable once a month shall be paid in arrears as soon as the full amount has been determined, but no later than within the first 10 days of the following calendar month. Here we have a reversed rule. Normally, the deadline falling on a day off expires on the first working day thereafter. For wages, the reverse rule applies – if the fixed payday is a public holiday, wages are paid on the preceding day.
The employer must pay wages at the place, date and time specified in the work regulations or other labour legislation.
In 2019, the Labour Code changed the rules on how wages should be paid. From now on, wages should be paid to the employee’s bank account. If the employee wishes to be paid in cash, then he or she must give the employer a request to pay the salary into his or her own hands
The value of the benefits paid constitutes the employee’s income on which income tax (paid by the employee) and social security contributions must be paid:
- social security – partly financed by the employee, partly by the employer,
- health insurance – it is financed by the employee,
- Labour Fund and Guaranteed Employee Benefits Fund – these are financed by the employer (sometimes it is also obliged to pay contributions to the Bridging Pension Fund).
Employing at least 25 persons obliges the employer to make contributions to the State Fund for the Rehabilitation of Disabled Persons, but contributions can be avoided by employing disabled persons or by shopping at sheltered workshops.
With at least 20 insured persons – primarily employees and contractors – the employer pays them benefits by deducting the amount from the contributions made to the Social Security.
The legislator decided that the remuneration for work should be determined in such a way that it corresponds, in particular, to the type of work performed and the qualifications required for its performance, as well as taking into account the quantity and quality of the work provided. At the same time, the legislator did not specify what criteria should be applied in determining wages attributable to the type of work. As a result, the employer has a free hand in this regard and can shape the pay scale almost freely. As a result, almost everything depends on the situation in the local labour market. If there is high unemployment, it is easier for an employer to find workers for less money. If there is low unemployment, however, it is usually necessary to offer higher wages in order to find an employee.
When determining the remuneration, the employer should bear in mind the need to ensure at least the minimum wage, which as of 1 January 2022 in Poland is PLN 3,010.00 gross per month and the minimum hourly rate is PLN 19.70.
In tax terms, benefits received by an employee constitute taxable income. In accordance with the regulations in force, income is constituted by cash payments and the monetary value of benefits in kind, as well as their equivalents. This applies primarily to basic salaries, overtime pay, bonuses and various allowances, as well as equivalents paid as compensation for unused holiday time. Furthermore, this also applies to all other amounts regardless of whether or not they are predetermined. The source of funding of the said payments and benefits is irrelevant here. It is also worth bearing in mind that income from the employment relationship often also includes cash benefits incurred by the employer for the benefit of the employee, as well as the value of other gratuitous or partly gratuitous benefits.
According to the Constitutional Tribunal’s judgment of 8 July 2014. (ref. K 7/13), such benefits which:
- were fulfilled with the employee’s consent and he or she took advantage of them fully voluntarily,
- were fulfilled in his interest (and not in the interest of the employer) and benefited him by increasing his assets or avoiding an expense he would have had to incur,
- this benefit is measurable and attributable to the individual employee.