Auto-Enrollment Pension in Poland: Impact on HRM Strategies and Pension Participation Rates

Marek Szczepanski,Krzysztof Kolodziejczyk

doi:10.5171/2021.961084

Abstract

The study aims a critical analysis and preliminary assessment of chosen effects of the implementation of a new type of occupational pension schemes with automatic enrollment: the Employee Capital Plans (PPKs), successively has introduced in Poland since 2019.

Highlights

The architecture of Polish pension systemIn 1999 Poland introduced radical systemic pension reform based on a switch from defined benefit public monopillar to defined contribution multi-pillar system with a mandatory funded element (Chłoń, Góra, Rutkowski 1999)
H4: The use of behavioral incentives will guarantee its success, which may be measured by over 50% participation rate and universal character of the program
The survey was conducted in August and September 2019

Summary

Introduction

In 1999 Poland introduced radical systemic (paradigmatic) pension reform based on a switch from defined benefit public monopillar to defined contribution multi-pillar system with a mandatory funded element (Chłoń, Góra, Rutkowski 1999). In the view of the ineffectiveness of traditional tax incentives and very poor development of additional pension savings, a new solution has been introduced – a new type of occupational pension scheme with automatic enrolment: PPKs. PPKs remain mandatory programs for employers and voluntary for employees (an opt-out option). According to the assumptions of the Act, PPKs are created and maintained for systematic saving by their participants to be paid after they reach the age of 60 (Article 3 of the Act) It is to be a universal and voluntary long-term saving system, available to all employees who are subject to compulsory retirement and disability insurance. From January 2020, the PPK's was introduced in companies employing at least 50 people, from July 2020 - at least 20 people, and from January 2021 - the remaining entities, including the public finance sector ones

Literature Review

Methodology and Results Discussion

Conclusions