Posted by When thinking about a company of several people, you need to answer the question: is it worth it to look for partners who will bring in start-up capital and work for the company, or is it better to start an individual business and hire employees. This is not an easy question, although hiring employees is a big cost for your business.
Below I show an example of hiring Anna Kowalska as an assistant in Nowak’s company under various forms of contract. Let’s assume that Anna Kowalska wants to earn 5000 PLN net, that is, on hand. Let’s use the pracuj.pl salary calculator:
https://zarobki.pracuj.pl/kalkulator-wynagrodzen/5000-netto
Case 1 – employment contract
In this case, you must have the largest budget for Anna Kowalska’s salary. See for yourself. The calculations are only illustrative for the situation in Poland.
The cost for your company: PLN 8253.05
The amount on the contract (gross): 6850.14 PLN
Payment (net amount): 5000.00 PLN
Fees charged:
Pension insurance: 668.57 PLN
Pension insurance: 102.75 PLN
Sickness insurance: PLN 167.83
Health insurance: 531.99 PLN
Advance tax payment: 379.00 PLN
Case 2 – contract of mandate without employment elsewhere
In the case of a contract of mandate, it is important whether this is the only job for Anna Kowalska. If so, the situation is similar to that of an employment contract.
Cost for your company: 8340.00 PLN
Amount on the contract (gross): 6922.31 PLN
Payment (net amount): 5000.00 PLN
Fees charged:
Pension insurance: 675.62 PLN
Pension insurance: 103.83 PLN
Sickness insurance: 0.00 PLN
Health insurance: 552.86 PLN
Advance tax payment: 590.00 PLN
Case 3 – contract for work (with transfer of property copyright)
This is the best case for Anna Kowalska and you, but it can rarely be used and also has many disadvantages for both parties.
Cost for your company: 5531.00 PLN
The amount on the contract (gross): 5531.00 PLN
Payment (net amount): 5000.00 PLN
Fees charged:
Pension insurance: 0.00 PLN
Disability insurance: 0.00 PLN
Sickness insurance: 0.00 PLN
Health insurance: 0.00 PLN
Advance tax payment: 531.00 PLN
Before you decide to hire an employee, you have to work hard to ensure that the benefits of his work cover the gross salary and the burden on the state budget. And after all, you still plan to make a profit for yourself, so a carefully considered decision is essential.