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The deadline is approaching for the implementation of the Employee Capital Plans (PPK) in small and medium-sized companies

The Employee Capital Plans are a relatively new form of long-term savings under the pension system. Ultimately, each person employed in a Polish company is to be automatically covered by the scheme and, if he/she does not withdraw from it, the employer will systematically accumulate savings for it in a special financial institution. The basic contributions to the PPK account will amount to 2% of the employee’s gross salary (or 0.5% for the lowest earners, i.e. people whose remuneration obtained from various sources in a given month does not exceed an amount equivalent to 1.2 times the minimum wage) and 1,5 % on the side of the employer. Both the employee and the employer can increase the amount of their contributions to 4% of the salary. The State will also contribute to the savings, which will pay 250 PLN “to start” and 240 PLN for each subsequent year of saving.

In accordance with the Act of 4th October 2018 on the Employee Capital Plans (Dz.U. z. 2020 r. poz. 1342), the obligation to implement the Employee Capital Plans has been spread over three stages and gradually covers subsequent companies, taking into account the employment status criterion.

The first stage concerned  large companies employing at least 250 employees as of 31.12.2018 and started on 01.07.2019. Employers had time until 25.10.2019 to conclude a contract for the management of the PPK and until 12.11.2019 to conclude a contract for running of the PPK.

The second stage required medium-sized companies employing 50+ employees to conclude a PPK management contract by 24.04.2020, however, due to the Covid-19 pandemic, the legislator passed the Anti-Crisis Shield 1.0 by equating the two deadlines of stage II and III of the  implementation of the PPK. As a result, the deadline for concluding the contract for the management of the PPK by medium and small companies has been postponed until 27.10.2020, and for the conclusion of the contract for running of the PKK – by 10.11.2020.

How do we know, whether we are obliged to implement the PPK by the upcoming deadline of 27.10.2020?  It is necessary to determine what was the employment status in the workplace as of 30.06.2019 and 31.12.2019. If it turns out that as of 30.06.2019 the entity employed at least 50 people, it is obliged to launch the PPK by the nearest deadline. Whether, as at 30.06.2019, it did not employ at least 50 people, but as at 31.12.2019, it employed at least 20 people, it is also obliged to launch the PPK by the end  of October/November this year. This means that the above-mentioned employers should conclude a PPK management contract no later than by 27.10.2020, and then conclude  the contract for running of the PKK no later than by 10.11.2020. It should be remembered that recognition as an employed person is determined by the criterion of being subject to compulsory social insurance in that respect.

The last,  IV stage of the implementation of the PPK will start on 01.01.2021 and will cover other entities, i.e. employers with 1-19 employees and public finance sector, regardless of the employment status. The deadlines for concluding contracts for the public finance sector are: contract for the management of the PPK – by 26.03.2021 and contract for running of the PPK – by 10.04.2021, while for other entities: contract for the PPK management by 23.04.2021 and contract for running of the PPK until 10.05.2021.

Failure to conclude a management contract within the above-mentioned legal time frame might result in a fine of up to 1.5% of the remuneration fund of the employing entity in the financial year preceding the offence.

In accordance with the  Act on the PPK, the employer selects the financial institution that will run the PPK in a given company in consultation with the employees. In addition, the employer has a number of other obligations related to the complex process of implementing the PPK in the company, including the collection of the necessary documentation, training and information obligations towards the employees.

Our Law Firm offers comprehensive support during the entire process of implementing of the program in the company, starting from selecting the most suitable financial institution and concluding agreements with it for the management and running of the PPK, and ending with the development of internal procedures for all tasks of the employer specified in the Act, so that the PPK documentation held with it protects  the employer against potential sanctions.