Although 1 January 2016 is still several months away, it is worth getting prepared now to the amendments that will be implemented by the Act amending the social insurance system law and several other laws of 23 October 2014 (Journal of Laws of 18.12.2014, item 1831). In a desire to prevent the abuse of the so called junk civil law contracts by employers, the legislator has implemented changes regarding the contribution calculation basis, which are especially significant if the individual performs work under several contracts of assignment (umowa zlecenia).

At present individuals qualifying for social insurance under several contractual or other relations are in principle covered by insurance in connection with one of them – the first one or the one they select. There are certain exceptions to this rule. In other circumstances, one relation underlying insurance excludes the other ones. For example, if the contractor provides work under several contracts of assignment, insurance contributions are calculated on one contract – the first one or the one he/she selects, regardless of the remuneration agreed by the parties. In fact, this gives a possibility to pay contributions on the contract with the lowest remuneration, which has been very often abused in practice as it allowed labour cost reduction.

As a result of the amendment, the obligation to pay contributions will be extended if the contract of assignment is performed at the same time as other paid activity and if several contracts of assignment are performed at the same time, which is to limit practical benefits for contribution payers from the execution of contracts of assignments instead of employment contracts.

According to the existing regulations, the individual qualifying for mandatory coverage with retirement and disability insurance under several contractual or other relations (for example home based work, agency contract, contract to perform a specified task, business activity) is covered by mandatory insurance on account of that which has arisen earliest. However, he/she may be covered voluntarily, at his/her own request, with retirement and disability insurance also on account of the other relations, all of them or certain selected, or he/she may change the relation underlying insurance. While according to the new regulations, the individual performing work under a contract of assignment whose calculation basis of contributions towards retirement and disability insurance in the given month is lower than the minimum monthly remuneration and who qualifies for mandatory insurance under other relations, shall be covered by mandatory retirement and disability insurance on account of the other relations as well. The above principle shall not be applied if the aggregate calculation basis of contributions due on work performed under a contract of assignment or on account of other relations has reached the amount of the minimum remuneration (as of 1 January 2015, the minimum gross remuneration is PLN 1,750). 

As explained in the rationale for the Amending Act, the objective is to equal the contract of assignment with other relations underlying insurance which must be cumulated to arrive at the contribution calculation basis in the amount of at least the minimum remuneration. It means that in accordance with the proposed amendment, the regulation on cumulation of relations underlying insurance in the event that the resultant contribution calculation basis is lower than the minimum remuneration for work will apply to contracts of assignment.  

In the case of contracts of assignment it is established that the cumulation principle will apply if the calculation basis of contributions towards social insurance (on account of the first relation) is lower than the minimum remuneration in the given month.

So the amended regulations will bring about the situation where, if several contracts of assignment are executed and the first of them underlying the calculation of contributions towards retirement and disability insurance is lower than the applicable minimum remuneration, the contribution calculation basis will include also other contracts of assignment qualifying the individual for mandatory retirement and disability insurance.