By 15 November 2024, the Member States of the European Union are required to implement the provisions of another directive into their national law. This is Directive (EU) 2022/2041 of the European Parliament and of the Council of 19 October 2022 on adequate minimum wages in the European Union, which introduces a number of regulations concerning the method and frequency of setting the minimum wage by the Government.
The directive specifies specific criteria that should be taken into account when updating the minimum wage in each country. These factors include primarily:
- General level of wages and their distribution,
- Purchasing power – statutory minimum wages, taking into account the cost of living,
- Productivity – long-term national productivity levels and their changes,
- Rate of wage growth – corresponding to the real growth of wages in the economy.
The above criteria are intended to contribute to ensuring adequate wages, which are to ensure a reduction in the level of poverty among workers, ensure fair pay, reduce the gender pay gap and support social cohesion. Member States will be obliged to regularly update statutory minimum wages at least once every two years. States will also have the option of applying an automatic indexation mechanism, which guarantees at least a minimum mandatory increase in the statutory wage. In the case of these countries, the obligation to update cannot be made less frequently than once every four years.
The directive will cover all employees of the European Union who perform work on the basis of an employment contract or are in an employment relationship defined by national laws, collective agreements and generally applicable practice.
The Ministry of Family, Labour and Social Policy is working on several changes to introduce regulations that will be consistent with the provisions of the aforementioned directive, so that in subsequent years the minimum wage will be determined on the new principles. The project is at the stage of public consultations.
Some of the changes proposed in the act are rather cosmetic, but several main points will have a significant impact on the formation of the minimum wage in subsequent years. These are primarily:
- mandatory update of the minimum wage no less than once every 4 years,
- the amount of the minimum wage is to be set in such a way that its average amount in a given year increases by no less than the price index forecast for a given year,
- increased penalties for violating the regulations on the payment of the minimum wage – from the current PLN 1,000 to PLN 30,000 to PLN 1,500 to PLN 45,000,
- the obligation for the employer to pay interest in connection with late payment of wages, even if the delay was caused by circumstances beyond the employer’s control,
- definition of a new offence against employee rights in the penal code in the event of failure to pay wages by the employer for a period of at least three months,
- the minimum wage will be equalised with the basic wage, which means that it will not be possible to reduce it by the value of bonuses or other allowances paid,
- the participation of employees and employers in shaping the minimum wage will be increased.
Currently, the minimum wage in Poland is set based on the regulations contained in the Act on the Minimum Wage (Act of 10 October 2002 on the Minimum Wage, Journal of Laws 2002 No. 200, item 1679). The wage in 2025 will still be set based on the old rules, i.e. using the so-called negotiated procedure for shaping the amount of the minimum wage. Each year, the minimum wage is subject to negotiations within the Tripartite Commission, which includes representatives of the government, employees and employers.
The Council of Ministers has proposed that from 1 January 2025, the minimum wage should be PLN 4,626 per month, which means an increase of 7.6% compared to the current rate. On the other hand, the minimum hourly rate for civil law contracts will be PLN 30.20.
However, according to the project published on September 12, the minimum wage for 2024 is to be even higher. The monthly wage was included at PLN 4,666, while the hourly rate was PLN 30.50.
The increase in the minimum wage also has a direct impact on other components of remuneration. The change in the minimum wage also shapes the change in the amount of such remuneration components as:
- night work allowance – the amount of the allowance is determined by dividing the minimum wage by the number of hours to be worked in a given month,
- severance pay for group layoffs – the amount of the severance pay for an employee depends on the length of service in a given organization but is also limited in amount to 15 times the minimum wage,
- remuneration during downtime based on art. 81 of the Labour Code – for the period of downtime introduced due to the employer’s fault, the employee is entitled to remuneration in the amount of 60%, but not lower than the minimum wage.
In addition to the above remuneration components, the increase in the minimum wage will also affect the change in:
- the amount of amounts free from deductions from the remuneration of employed employees,
- the minimum amount of income constituting the basis for calculating the contribution to the Labour Fund,
- the minimum amount of the base for contributions to retirement and disability insurance for persons on parental leave.
It is worth considering the above issues now when planning the company’s budget for 2025.