Do I Need a Local Entity to Hire in Poland?

In Poland, a "local entity" refers to a recognized employing presence, such as a subsidiary or branch, that allows you to be compliant with local employment laws. This setup is essential for managing payroll and fulfilling employer obligations, including tax and social security contributions.

Without a local entity, you typically cannot register as an employer, manage payroll, or issue compliant employment contracts. An Employer of Record (EOR) can serve as your local entity, allowing you to hire employees without the complexities of setting up a business.

What is Required to Employ Someone in Poland?

• Local employing entity required to directly employ? Yes (necessary for direct employment and payroll registration)
• Payroll registration required? Yes (must register with the National Revenue Administration)
• Withholding/tax remittance required? Yes (employers must withhold income tax and social security contributions)
• Social contributions required? Yes (mandatory contributions to the Social Insurance Institution)
• Local employment agreement required? Yes (written contracts are mandatory under Polish law)
• Mandatory benefits to budget? Yes (statutory leave, health insurance, and pension contributions)
• Works council/collective agreements considerations? Often (many sectors have collective agreements that influence employment terms)

Best Options If You're Hiring in Poland

Can I Hire Contractors Instead of Setting Up an Entity?

Yes, but it’s important to ensure that the contractor relationship is genuinely independent.

While you can hire contractors without establishing a local entity, Poland has strict regulations regarding worker classification. Misclassifying a contractor as an independent worker can lead to significant legal issues. Here are some key points to consider:

• Ensure the contractor has multiple clients and is not exclusively working for your company.
• Maintain minimal control over how the work is performed to avoid misclassification.
• Be cautious if the contractor's role is integral to your business operations.

How Long Does Entity Setup Take And What Does It Cost?

Typical entity setup timeline: It often takes 4–8 weeks to set up an entity in Poland, depending on the type of business and registration requirements.

Ongoing cost categories (entity route):

• Accounting, bookkeeping, and statutory filings: Estimated 1,000–3,000 PLN per month ($240–$720)
• Payroll provider: Estimated 200–600 PLN per employee per month ($48–$144)
• Employer registrations and recurring compliance: Varies by complexity
• Corporate tax filings and annual reporting: Estimated 5,000–15,000 PLN per year ($1,200–$3,600)

EOR cost components (no-entity route):

• A per-employee EOR service fee (from $399 per month with Playroll)
• Pass-through statutory costs (e.g., employer social security contributions, which are approximately 20.48% of gross salary)
• Any optional benefits you choose to provide beyond statutory minimums

How an Employer of Record Can Help You Hire in Poland

Hiring in Poland can be complex, but it doesn’t have to require setting up a local entity or taking on long-term overhead. With an Employer of Record like Playroll, you get a simple, predictable way to hire compliantly while keeping costs transparent and under control. We help you:

• Hire employees in Poland quickly without establishing a local entity, eliminating incorporation costs, ongoing administration, and exit complexity.
• Stay fully compliant with local payroll, tax, and employment regulations with Playroll’s managed payroll services.
• Control your total employment costs, with a clear monthly EOR service fee (from $399 per employee).
• Focus on growing your business, while we manage contracts, payroll, compliance, and labor law obligations end to end.
• Scale up or exit the market easily, without the financial or legal burden of closing a local entity.