The employee is entitled to an annual, continuous, paid holiday leave. (Art. 152 § 1 of the Polish Labor Code)
The remuneration for holiday leave is determined along with the remuneration and other benefits solely under the employment relationship. When determining the pay for holiday leave, it is necessary to pay attention to three aspects:
When calculating the basis for the holiday pay, one needs to remember to exclude some components under the employment relationship, namely:
On the other hand, the components included in the calculation of the payment basis for leaves are, among others:
Example 1
The employee uses holiday leave in June. Their remuneration consists of base remuneration in the amount of PLN 6,000 and special duty allowance in the amount of PLN 250.00. In March, the employee received an annual award in the amount of PLN 2,000.00 and in April and May they received additional statutory bonuses in the amount of PLN 500 in each of those months. Which of the components must be taken into consideration?
When determining the remuneration basis for the employee’s leave, one needs to acknowledge all the remuneration components that the worker received in a particular period, excluding only the annual award.
Fixed and variable components of remuneration vs holiday pay
Components of remuneration specified in the fixed monthly rate for time of leave must be paid in the amount that applies in the month in which the worker uses their leave.
For the period of leave, the worker is entitled to a remuneration that he or she would have received, if they had worked during that period. Variable components of remuneration can be calculated based on the average pay for the period of 3 months preceding the month in which the leave started; in case of significant discrepancies in the amount of the remuneration, the said period can be extended to 12 months. (Art. 172 of the Polish Labor Code)
Example 2
The employee receives basic remuneration under a contract of employment i.e., PLN 5,000.00. In June, they spent 9 days on holiday leave. What will be their remuneration?
However, regardless of the number of days of used leave, the employee will receive a remuneration of PLN 5,000.00.
In the case of variable components, it is necessary to:
Example 3
In April 2024, the employee spent 5 days on holiday leave. Their basic remuneration is composed of basic remuneration of PLN 5,000.00, special duty allowance of PLN 200.00 and a monthly bonus that amounted PLN 500.00 in January, PLN 450.00 in February and PLN 250.00 in March. The employee was employed on a full-time basis. How will the vacation pay be calculated?
The remuneration for the holiday leave must be calculated in the following way:
PLN 5,000.00 + PLN 200.00 = PLN 5,200.00;
PLN 1,400.00 : 504 h = PLN 2.78;
PLN 2.78 x (5 days*8 h) = PLN 2.78 x 40 h = PLN 111.20;
For the period of the holiday leave, the employee should receive remuneration for variable components in the amount of PLN 111.20.
The employee’s remuneration is: PLN 5,200.00 + PLN 111.20 = PLN 5,311.20.
Author: Dorota Rosak, HR and Payroll Specialist at the MDDP Outsourcing office in Warsaw
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