Only one month left to conclude the ECPs management agreement with a financial institution

We would like to remind you that the entities in the 2nd and 3rd stage of ECP implementation must conclude the ECPs management agreement with a financial institution within the coming month.

Until 27 October 2020, entities employing at least 50 employees as at 30 June 2019 and entities employing at least 20 employees as at 31 December 2019 are required to conclude the ECPs management agreement with a financial institution, and until 10 November 2020 the agreement on the ECPs maintenance. Therefore, we would like to remind you about the most important issues related to the implementation of ECP in your company.

Employee capital plans?

Employee capital plans (the “ECP”) form a new, voluntary system of saving, which is supplementary to a pension from the Social Security Agency. ECPs were created in order to systematically accumulate certain amounts to be paid out after the eligible person attains the age of 60.

What are employing entities?

The obligation to apply the Employee Capital Plans Act is imposed on the employing entities, i.e. as defined in Article 2 paragraph 1 point 21 of the Employee Capital Plans Act:

  • employers referred to in Article 3 of the Labour Code,
  • outwork employers,
  • farming co-operatives or co-operative associations of farmers,
  • recipients of services,
  • entities with the supervisory board, provided that its members are remunerated for the performance of their functions.

If your company belongs to any of the above groups and employs at least 20 persons (as at 31 December 2019), you should immediately take action to implement the ECPs for your employees.

No later than on:

  • 27 October 2020, you are obliged to sign an agreement on the ECPs management,
  • 10 November 2020 to sign an agreement on the ECPs maintenance.

We would also like to remind that deadlines for the implementation of the ECP have been extended for the entities employing at least 50 persons (entities included in stage II of the ECP implementation), in connection with the Act of 31 March 2020 amending the Act on special solutions related to the prevention, prevention and control of COVID-19, other infectious diseases and crisis situations caused by them and some other acts  (the deadlines for the implementation of the ECP for the II stage of implementation are the same as for the entities from the III stage of implementation of the ECP).

Payments towards the employee capital plans. How much are they?

Payments towards the ECPs are basic or supplementary. They are financed by both the employer and the ECP participant.

Basic paymeny (obligatory)Supplementary payment (voluntary)
Employer’s share1.5% of the gross remunerationup to 2.5% of the gross remuneration
Employee’s share2% of the gross remuneration*up to 2% of the gross remuneration

*The basic payment by an employee may be up to 2% of his/her gross remuneration, but not less than 0.5%, provided that his/her remuneration earned from various sources in a certain month does not exceed 1.2 times the minimum remuneration.

Law office D.Dobkowski sp.k. offers legal assistance to employers who are required to implement PPK

We are aware that the implementation of the Employee Capital Plans is a challenge for every employer. It is connected with the necessity of taking a number of legal and organisational actions. Therefore, our team of ECP specialists assists employers through:

  • election of the employees’ representatives,
  • preparation of internal regulations concerning the introduction of the ECPs,
  • selection of a financial institution managing the ECPs,
  • providing support in concluding the ECPs management and maintenance agreements with a financial institution (including a review of compliance with agreements terms proposed by a financial institution),
  • representing the employer in negotiations with the community representation,
  • fulfilling the employers’ information obligations towards the ECPs participants and a financial institution with which the employer has concluded the ECP management agreement.

If you are interested in more detailed information on the above-mentioned issues, please contact us.

Information contained in this publication is of general nature and does not relate to the situation of a particular company. Due to frequent changes in Polish legislation, we kindly request that you make sure that on the day you are reading this publication the information contained therein is still up to date. We suggest that you consult our advisers before making any decisions.