Employee Pension and Savings Programs

We support our clients in the preparation, modification, and implementation of Employee Pension Programs and Employee Capital Plans. We create dedicated investment programs for the Board / Managers.

Employee Pension Program

The PPE operates within the third pillar of the pension system alongside IKE, IKZE, and PPK, based on the 2004 Act. The essence of PPE is the employer's payment of monthly basic contributions of up to 7% of employees' salaries. Besides the contributions paid by the employer, employees can pay an additional contribution, which is deducted by the employer from the participant's taxed salary. A financial institution manages the accumulated funds, investing to multiply the participants' money.

Advantages for the employer:

• The basic contribution paid by the employer is exempt from social security contributions;
• Costs associated with offering PPE are recognized as a cost of revenue;
• Rewarding employees who are longest associated with the employer through an objective seniority criterion, e.g., 1, 2, or 3 years of employment required to join PPE;
• Exemption for employers from creating Employee Capital Plans by paying a PPE contribution of 3.5% of an employee's salary and with a participation of at least 25% of employed workers;
• Freedom to choose investment models and funds available in PPE;
• Reducing employee turnover and related costs.

Employee Capital Plans

PPK is a voluntary long-term savings system established by the 2018 Act. The employer, in agreement with employee representation / trade unions, selects a Financial Institution to manage the funds accumulated in the program. Accounts will be funded by contributions from the employee and employer, as well as a welcome payment and annual state subsidies. The funds accumulated in the accounts will be invested in funds considering the age of the PPK participant - so-called target-date funds.

Stages of implementation of the regulations:

• from July 1, 2019 – entities employing at least 250 people (as of Dec. 31, 2018);
• from January 1, 2020 – entities employing at least 50 people (as of June 30, 2019);
• from July 1, 2020 – entities employing at least 20 people (as of Dec. 31, 2019);
• from January 1, 2021 – other employing entities and public finance sector units (regardless of employment status).

Advantages for the employer:

• The contribution paid by the employer is exempt from social security contributions;
• Costs associated with offering PPK are recognized as a cost of revenue;
• The minimum monthly employer contribution is 1.5% of the employee's salary (with the possibility of additional contributions up to 2.5%);
• Reducing employee turnover and associated costs.

Investment Programs for the Board / Managers

We propose adding to the protective program a financial bonus funded by the employer in the form of a savings program based on three schemes:

1. Opening an Individual Retirement Security Account (IKZE), which provides numerous privileges;
2. Opening an Individual Retirement Account (IKE) – advantages:
3. Adding an investment fund (PPO) to which the remaining funds from the bonus granted by the employer will be transferred beyond the limit for use in IKZE and IKE in 2020. Advantages of a group investment program include low management costs, no hidden fees, the possibility of investing funds in global markets, designating beneficiaries who will receive the funds in case of the employee's death.

Advantages for the employer:

• Costs related to offering an investment program for the Board / Managers are recognized as a cost of revenue;
• Reducing turnover of key employees for the company / enterprise;
• The possibility of deferring the transfer of ownership of funds paid by the employer due to the length of the employee's employment, known as Vesting;
• An additional benefit offered to key employees in the recruitment process.

Scope of PBG Employees' Support for Our Clients:

1. Selection of a Financial Institution managing the pension and savings program, including:
2. Development of the PPK launch project, including:
3. Signing PPE agreements and registering the program with the Financial Supervision Authority,
4. Implementation of the pension and savings program: