The concept of „delegation” is very often confused with „secondment”. A mistake in distinguishing these two concepts can have very serious consequences. Therefore, we will try to explain what differs a delegation from a secondment.
The definition of delegation results from Article 775 § 1 of the Labour Code. That provision states: An employee who, at the employer’s request, performs a professional task outside the city where the employer’s head office is located or outside the regular place of work shall be entitled to receivables to cover the costs related to the business travel.
The quoted provision shows that in order to consider an employee’s departure as a delegation, it should meet the following conditions:
- the employee has been received travel order,
- the employee performs a professional task during the departure,
- the professional task should be performed outside the city where the employer’s head office is located or outside the regular place of work.
The essence of the delegation is its incidental nature (see the resolution of the Supreme Court in the composition of seven judges of 19 November 2008, ref. II PZP 11/08). It is also characterized by the fact that the place of employment doesn’t change in connection with the worker’s departure.
The legislator didn’t define the secondment. Therefore, the doctrine has dealt with the explanation of this concept. It is assumed that a temporary change of the place of employment is a caracteristic feature of the secondment. The change in question requires the conclusion of an appropriate agreement between the employer and the employee – the so-called export annex.
3. Additional employee benefits
An employee in the delegation is entitled to additional benefits. These include daily allowances and reimbursement of the costs of: travel, commuting by public transport, accommodation and other necessary and documented expenses, specified or recognized by the employer in accordance with justified needs.
The rules for the payment of the abovementioned benefits to employees of the public sector are specified in the Regulation of the Minister of Labour and Social Policy of 29 January 2013 on the receivables due to an employee in a state or local government budgetary unit for a business trip (Official Journal of 2013, item 167, as amended). On the other hand, the conditions for payment of receivables due to a business trip to an employee working for an employer other than the public sector should be specified in the collective labor agreement or in the remuneration regulations. If the employer isn’t covered by the collective agreement or isn’t obliged to establish remuneration regulations, the conditions for payment of receivables in question should be determined by an employment contract.
A seconded employee isn’t entitled to additional benefits related to the departure. However, internal company regulations may provide for the payment of appropriate benefits to such a posted worker.
4. Social insurance
The remuneration for the work of an employee in the delegation is subject to contribution in Poland. It doesn’t matter whether the work during the business trip is performed in Poland or abroad. On the other hand, additional benefits due to the employee for business trips aren’t subject to contribution to the amount specified in special provisions. In accordance with § 2 (1)(15) of the regulation of the Minister of Labour and Social Policy of 18 December 1998 on detailed rules for determining the basis of contributions to the pensions scheme (i.e. OJ 2017, item 1949, as amended), the following income doesn’t form the basis of contributions: daily allowances and other receivables for the employee’s business trip – up to the amount specified in the regulations on the amount and conditions for determining the receivables due to an employee in a state or local government budgetary unit for a business trip in national territory or abroad, subject to point 17.
The issue of contributing to the remuneration due to a seconded employee is completely different. As a general rule, the salary of such a worker should by subject to contribution in the country of secondment, in accordance with its own legislation. However, it is possible that the employee will be subject to social insurance in Poland. The A1 Certificate provides this option. Nevertheless, it should be remembered that this document applies only if the employee is sent to work in the territory of another EU Member State, EEA or Switzerland. The certificate is issued by ZUS (Zakład Ubezpieczeń Społecznych – Social Insurance Institution).
The salary payable to an employee on a business trip is taxed. On the other hand, daily allowances and other receivables for the employee’s business travel are exempt from tax. However, the exemption shall apply up to the amount specified in separate provisions (Article 21(1) of the Personal Income Tax Act of 26 July 1991 (i. e. OJ 2021, item 1128, as amended), hereinafter referred to as the Act).
The remuneration of a secondment worker is taxed, but partially. In accordance with Article 21 21(1)(20) of the Act, the tax exemption concerns the part of revenue of persons who are temporarily abroad and receive revenue from the employment relationship for each day of stay abroad, during which the taxpayer remained in the abovementioned legal relationship, in an amount corresponding to 30% of daily allowance, specified in the regulations on the amount and conditions for determining the receivables due to an employee in a state or local government budgetary unit for a business trip abroad. The exemption in question doesn’t apply to the remuneration:
- of an employee who is on a business trip outside the Republic of Poland;
- of an employee in connection with his stay outside the borders of the Republic of Poland in order to participate in an armed conflict or to strengthen of the forces of the state or allied countries, to participate in a peacekeeping mission, actions to prevent acts of terrorism or their consequences, as well as in connection with the acting as an observer in peacekeeping missions of international organizations and multinational forces, as long as he or she receives benefits exempt from tax under paragraph 1, point 83 or 83a of the Act;
- received by a foreign service member (Article 21(15) of the Act).
6. Legal notice
The study is a work within the meaning of the Act of 4 February 1994 on Copyright and Related Rights (OJ 2006, No. 90, item 631, consolidated text, as amended). Publishing or reproducing this study or its part, quoting opinions, as well as disseminating in any other way the information contained therein without the written consent of Crede sp. z o.o. is prohibited.