Employer of record in Poland
What exactly is an employer of record? How does this form of employment relate to Polish labour law? Does the EoR model also include the use of temporary employment agency services? What is the employer of record in LeasingTeam Group’s offer and how can it help your company? Check it out!
What is an employer of record?
Employer of record is a specific employment relationship that a foreign employer can decide on, especially when it often does not formally have its registered office in Polish, but wants to employ Polish employees. The registered office of the entity using this service is located in another country and it is not necessary to create a Polish organizational unit, which allows you to avoid unnecessary formalities and costs.
It is worth noting that in many industries, the provision of services to customers is primarily carried out remotely, which applies to the IT industry, for example. A company operating in the United States, for example, can provide services to clients from all over the world, employ Polish programmers, but do not need a Polish office.
An employer of record is a so-called employer of record, umbrella company or external employer, i.e. a company registered in a given country and formally employing employees who actually provide their services to another entity. Temporary work, according to Polish law, can be considered one of the forms of employer of record activity.
Employer of record from the point of view of labour market participants
In practice, EoR services can take place in various legal forms, but the scheme of operation of the employer of record is always very similar. A key feature of this model is the separation of the formal and actual roles of the employer. The entity providing the EoR service acts as a formal employer – it concludes a contract with the employee (most often an employment contract or a civil law contract) and takes over the duties related to HR and payroll administration.
On the other hand, the EoR client, i.e. the company using the service, plays the role of the actual employer, because it is the one who manages the employee’s daily duties, sets goals and reaps the benefits of the work performed. In the event of incorrect application of the model, e.g. exceeding the permissible deadlines of temporary work or the lack of employment agency status, it may be considered that an employment relationship has been established between the employee and the actual beneficiary of the work.
Employer of Record
A formal employer, also known as an external employer, is an entity that signs a contract with an employee and it is the employee that the employment relationship is established between the employee and the employee. At the same time, the employer of record takes over the responsibilities related to employment, as is the case, for example, in the case of temporary work. The Employer of Record is also responsible for HR and payroll services for the employees employed, but does not manage them and does not delegate tasks to employees.
Actual employer – the company for which the employee performs work
In practice, the actual employer uses the services of the employee, benefiting from his work in exchange for remuneration (formally paid by the EoR). Most often, this role is played by foreign companies that do not have their organizational units in Poland, so from a legal point of view they operate only in another country or countries. Thanks to this form of cooperation, they avoid the need to open their branches in Poland or another country of the European Union.
Employee
The EoR model also benefits the employee, who in this form finds legal employment on satisfactory terms. Thanks to the agreement signed with EoR, his interests as an employee are perfectly protected by Polish law, and at the same time he has a chance to take part in projects not available in Poland, carried out by foreign companies.
Employer of record in Polish law
Although in recent years more and more foreign entities prefer employment as part of the employer of record service, this model has not been formalized in Polish law. For this reason, it sometimes raises doubts among potential real employers or employees. At this point, it is worth dispelling them. Employer of record can take place in Poland as temporary work in cooperation with a temporary employment agency.
Is there a risk of establishing an employment relationship?
In the case of using the EoR service in the form of temporary work, there is a risk of establishing an employment relationship between the employee and the actual employer, but only if the period of employment exceeds the period of employment provided for in Polish law or the company providing the EoR service does not have the rights of a temporary employment agency. In practice, foreign companies undertake cooperation with a trusted partner to zero. The regulations governing the form of temporary work in Poland are included in the The Act of 9 July 2003 on the Employment of Temporary Workers (Journal of Laws of 2003 No. 166, item 1608) .
Employer of record in LeasingTeam Group – questions and answers
At LeasingTeam Group, we receive more and more questions from potential customers regarding employer of record, so it is worth answering them in one place.
Does LeasingTeam Group provide the employer of record service?
For over two decades, the LeasingTeam Group has been providing comprehensive services related to human resources management, personnel consulting and work organization. Our services also include employer of record, i.e. temporary work. We help our clients to benefit from the support of employees at various levels without unnecessary formalities and costs, each time finding the optimal form of employment and cooperation, in accordance with Polish regulations. Feel free to contact us!
What are the possible forms of cooperation in the case of employer of record?
Although Polish law does not specify the rules of operation of the employer of record, companies using this solution in Poland have at least several forms of cooperation with an umbrella company, i.e. a formal employer. At LeasingTeam Group, we will reduce the risk associated with EoR to zero. Here are the possible forms of cooperation.
According to Polish law, a temporary worker may perform work for one user employer for a period not exceeding a total of 18 months in the next 36 months. The exception is when a temporary worker has been assigned to perform work to replace an absent employee – then the permissible period may be up to 36 months. These rules result from Article 20 of the Act of 9 July 2003 on the employment of temporary workers.
This means that employment through a temporary employment agency should, in principle, be temporary and meet the temporary needs of the user’s employer. Exceeding the statutory limits may constitute a violation of the regulations and be associated with the risk of questioning the correctness of the employment model, including potential disputes regarding the existence of the employment relationship. That is why it is so important to comply with time limits and cooperate with agencies with the required qualifications and entry into the KRAZ.
This form of cooperation can be recommended to Polish and foreign companies that need temporary support from programmers and other IT specialists. Outsourcing allows you to avoid many formalities and employment costs, while instantly supplementing the team with a professional who is well prepared for their role.
This is a long-term solution in which the company delegates part of its tasks and functions to an external entity, thanks to which it can formally reduce employment and, above all, costs. Outsourcing very often includes accounting, but it can also concern logistics, HR, HR and payroll (payroll), training, marketing, customer service or IT services.
Are you interested in a legal and safe employer record in Poland or another form of support for your company in the field of human resources management or employment? Contact us and we will surely find the optimal solution for you!
