Employee Capital Plans (PPK) are a voluntary, additional retirement savings scheme in which the employee, the employer and the State Treasury all participate. For employers, this means specific, time-bound administrative obligations – neglecting them can result in financial penalties.
1. Choosing a financial institution
The first step is choosing the financial institution that will manage the PPK. The choice should be made in agreement with the company trade union or – if there isn't one – with employee representatives. The employer then signs a PPK management agreement with the chosen institution.
2. The PPK administration agreement and enrolling participants
After signing the management agreement, the employer signs a PPK administration agreement on behalf of and for the benefit of employees. It automatically covers people employed for between 3 and 55 months who are subject to social insurance, with the option for the employee to opt out by submitting a declaration.
3. Basic and additional contributions
Each month the employer remits PPK contributions, which consist of a part financed by the employee and a part financed by the employer:
- Basic employee contribution: 2% of salary (can be reduced to 0.5% for lower earners)
- Basic employer contribution: 1.5% of salary
- Additional contributions: up to 2% (employee) and up to 2.5% (employer) – optional
4. Ongoing administration and reporting
The obligations don't end with implementation – every month you need to correctly calculate and remit contributions, handle opt-outs and re-enrolments (every 4 years the employer must inform employees about automatic re-enrolment), and respond to HR changes such as new hires or changes in working time.
In practice, this means PPK must be treated as a permanent part of the payroll process, not a one-off implementation project.
How I can help
As part of HR and payroll outsourcing, I handle full PPK administration – from implementation to monthly settlements, enrolments and processing employee declarations. If your company hasn't implemented PPK yet, or wants to hand this over to a specialist, get in touch – together we'll work out the best schedule.