Over the last three years, the minimum wage in Poland has grown by double-digit percentages. The anticipated increase coming into effect in January 2025 appears smaller, yet it will once again result in a larger burden for employers. Unemployment is not a threat considering the present demographic collapse, but firms may be less eager to employ people entering their first jobs. Simultaneously, the government is implementing an EU directive on minimum wages which will regulate its relation to average earnings in the national economy.
“We fear that the rises in the minimum wage are too dynamic. For the second year in a row, the minimum wage increases at a pace of 20%, significantly more than the average increases in the economy. Especially the micro and small business sector struggles to deal with this. We are not precisely sure how, as the data from micro-enterprises are collected on a limited scale, but it seems that this may result in reduced employment and an increase in the grey zone,” says Prof. Jacek Męcina, an advisor to the Confederation of Polish Employers, “We should put the brakes on these dynamic rises in the minimum wage, especially as the ratio of minimum wage to average earnings is already very high.”
According to the September 2024 government regulation, starting from January 2025, the minimum wage will be increased to PLN 4666 (gross). This means a raise by 8.5% compared to the current rate. The minimum hourly rate is also set to rise to PLN 30.50 (gross). This increase will only take place once in 2025, contrasting to 2024 when the minimum wage rose twice.
Prof. Męcina explains that “too dynamic a growth in minimum wage may indeed negatively affect the labour market. Unemployment may not be a threat, as we are in a deep demographic collapse and our economy heavily relies on migrant resources, but it could certainly bring certain disturbances for the youth, who may find it harder to enter the job market.”
The government is working on a new law on minimum wages for work, which will come into effect from 1 January 2026. It stems from the need to implement the directive of the European Parliament and the Council (EU) 2022/2041 of 19 October 2022 on adequate minimum wages in the European Union. The draft of the law regulates the principles and procedures for setting and updating the minimum wage for work and establishes an advisory body competent in matters related to the minimum wage for work.
Prof. Męcina adds, “we are discussing how to change the regulations concerning the minimum wage in the context of the European Union’s directive on adequate wages and we already know that this mechanism should change the way the minimum wage is calculated.” This would suggest a simplification do be made in calculating minimum wage, possibly tying it to inflation or setting it at 50% of the average pay.
The professor comments on the lack of engagement in social dialogue, particularly on the part of the government, and points out problems with representation on the employer side. He states that “there are seven organizations already sitting on the employer’s side and very often this dialogue depends on these employer organizations first agreeing among themselves before they can negotiate with the trade union side and the government,” suggesting a need for changes in the criteria for representation, for the dialogue to be conducted by the government, three union federations, and the three largest employer organizations.
The discussion with Prof. Męcina took place during the XIII European Forum of New Ideas (EFNI) in Sopot, organized by the Confederation of Polish Employers. Topics of conversation included the future of the job market in light of automation, digitization, and artificial intelligence, highlighting the importance of continuous development and acquisition of new job skills. He concluded by forecasting that many manufacturing workers might lose their jobs or need to upgrade their skills in the next decade due to these technological transformations.
