For many, an employment contract (umowa o pracę) is synonymous with stability and security. Undoubtedly, it is the most formalized yet most privileged form of employment in Poland. It also entails a series of rights and obligations for both parties. These are all regulated by the Polish Labour Code.

Regardless of whether you plan to hire your first employee or are looking for a job yourself, this guide is for you. Therefore, we will explain the characteristics of a Polish employment contract, its key elements, and what costs the employer must consider.

What Is an Employment Contract?

Essentially, an employment contract is a formal agreement. Under it, an employee agrees to perform specific work for an employer. This is done under their direction at a designated place and time.

Key features of an employment relationship:

• Subordination: First and foremost, the employee follows the supervisor’s instructions.
• Personal performance of work: In other words, an employee cannot send someone else as a substitute.
• Defined place and time of work: Moreover, the work is performed within a set time frame and location.
• Remuneration and employer’s risk: It is worth noting that the employer bears the economic and organizational risks.

Types of Employment Contracts

The Polish Labour Code specifies several types of contracts.

1. Probationary period contract (umowa na okres próbny): Firstly, this can be concluded for a maximum of 3 months. As a result, it serves to verify the employee’s qualifications.
2. Fixed-term contract (umowa na czas określony): Next, we have the most popular type of contract. An employer can sign a maximum of 3 such contracts with the same employee, for a total period not exceeding 33 months.
3. Indefinite-term contract (umowa na czas nieokreślony): Finally, this is the contract that gives the employee the greatest stability and protection against dismissal.

Key Employee Rights Under an Employment Contract

Undoubtedly, by choosing an employment contract, an employee gains a range of rights not available in other forms of cooperation.

• Right to paid vacation leave: For example, 20 or 26 days a year, depending on length of service.
• Right to sick pay (L4): Additionally, after 33 days of sickness in a year, the employee is entitled to a sickness benefit from ZUS.
• Protection against dismissal: Also, in certain situations (e.g., pregnancy, vacation, pre-retirement age).
• Notice period: Its length depends on the period of employment with a given employer.
• Minimum wage: Of course, there is a guarantee that the salary will not be lower than the statutory minimum (in 2025: 4,666 PLN gross).

Employer’s Obligations – It’s Not Just About Paying a Salary!

On the other hand, hiring an employee under an employment contract involves a number of formalities for the employer.

• First of all, registering the employee with ZUS (Social Insurance Institution) within 7 days from the start date.
• Additionally, maintaining personnel files for each employee.
• Also, referring the employee for medical examinations: initial, periodic, and follow-up.
• Organizing health and safety training (BHP).
• Timely payment of remuneration.
• Remitting ZUS contributions and income tax advances.

The Total Cost of Hiring an Employee

It’s important to stress one thing. What an employee sees as “gross” on their contract is not the total cost for the employer. Namely, ZUS contributions financed by the employer must be added to the gross salary.

The employer’s share of contributions amounts to a total of approx. 20.48% of the gross salary:

• Pension insurance: 9.76%
• Disability insurance: 6.50%
• Accident insurance: 1.67% (standard rate)
• Labour Fund (FP): 2.45%
• Guaranteed Employee Benefits Fund (FGŚP): 0.10%

Example (based on the minimum wage in 2025):

• Employee’s gross salary: 4,666 PLN
• Employer’s ZUS contributions: 4,666 PLN * 20.48% = 955.60 PLN
• Total employer cost: 4,666 PLN + 955.60 PLN = 5,621.60 PLN (approx. €1,300)

As you can see, the real cost of hiring an employee is over 20% higher than the amount on the contract.

Summary

In conclusion, the Polish employment contract in 2025 provides employees with the greatest stability. However, for the employer, it means the highest costs and the most formal obligations. Therefore, it is an ideal solution when a company needs a permanent, loyal, and fully available team member, and its budget is ready to cover all related costs.

The next post on our blog will be about the contract of mandate.