Excessive employee costs, layoffs and bankruptcies. Letter lands on the desk of the Minister of Labor

The minimum wage from 2026 is to be 55% of the forecasted average wage. The draft law on this matter was published a few days ago. The employees affected by this will be happy because it will allow them to bring their wages closer to the average salary. In 2023, this ratio was 50.3%. Forecasts for 2024 indicate that the minimum wage will be PLN 4,300, which is 53.7% of the forecasted average wage (PLN 8,007 gross).

Higher minimum wage

The proposed changes to the regulations are a result of the need to implement the EU directive on adequate minimum wages in the European Union. Each Member State has some freedom to decide how to achieve the objectives set out in the directive. What does this mean? Countries must choose one or more “indicative reference values”, for example 60% of the median wage or 50% of the average wage (at international or national level).

The annual increase in the minimum wage is a problem for some entrepreneurs, and at the same time, the percentage of employees who earn only the minimum wage – and not a penny more (at least officially) – has been growing dangerously for several years. This is because when employers have already raised the salaries of those they had to (the lowest earners) and they are equal to those slightly higher, they do not raise the salaries of other employees. As a result, employees who earned more than the minimum a year ago are in the group of the lowest paid. In this text, we describe how this group has grown in recent years and why this is a dangerous trend.

SME Ombudsman on “excessive staff costs”

The spokesperson for small and medium-sized enterprises, Agnieszka Majewska, sent a letter to the head of the Ministry of Labor, Family and Social Policy, Agnieszka Dziemianowicz-Bąk, in which she reminds about the risk associated with raising the minimum wage too much.

“Excessive employee costs, growing in a way that is inadequate to the current economic situation of enterprises, not only limit the competitiveness of Polish companies and the possibility of their development by hiring new employees, but in some cases may result in employment reductions or even the need to suspend or close down operations,” she pointed out.

The SME spokeswoman referred to the draft regulation of the Council of Ministers prepared by the Ministry of Family, Labour and Social Policy, which provides for an increase in the minimum wage to PLN 4,626 in 2025, and the minimum hourly rate to PLN 30.20.

In her opinion, the share of the minimum wage in staff costs is too high and makes it difficult to pursue a “flexible” HR policy, which requires the possibility of offering more attractive remuneration to experienced and efficient employees.

“Micro-entrepreneurs and small and medium-sized entrepreneurs are currently in a particularly difficult situation, which is the result of, among other things, a significant increase in energy costs and disproportionately high burdens related to the rules for determining the amount of health insurance contributions and social insurance liabilities. The increase in the minimum wage resulting from the regulations contained in the draft regulation will be another factor that makes it difficult to continue conducting business activities,” she wrote.