Remote working was introduced into the Polish legal system by Article 3 of the Act on special arrangements for preventing, counteracting and combating Covid-19, other infectious diseases and crises caused by them, dated 2 March 2020 (emergency Covid-19 legislation). The regulation was an immediate response to the outbreak of the virus and was supposed to be only a temporary solution. At the time, no one had expected that the epidemic would turn into a pandemic and stay with us for so long.

Because it took many months for the government to draw up the bill amending the Labour Code, the entire arrangement for remote working is still based on a single article of the emergency Covid-19 legislation. However, the provision says nothing about the costs of remote work carried out by employees. Therefore, stipulating such an obligation for the employer could be seen as far-fetched. Nonetheless, many employers have gone out of their way to meet the needs of their employees and introduced their own internal regulations for covering such costs.

In contrast, the proposed regulation explicitly set out the employer’s obligation to cover the costs of remote working. According to the explanatory notes to the bill, the regulation is intended to bring together the demands of trade unions – that the obligation to compensate employees for the costs incurred while working remotely is regulated – and employers' organisations – that the act should precisely define these costs.

Under the regulation, the employer will bear the following costs:

• Electricity and telecommunication services necessary to carry out remote work, as well as other costs directly related to remote working, if their reimbursement is set out in an agreement between the employer and the company trade union or in remote work regulations, an order or an individual agreement
• Installation, servicing and maintenance of work tools necessary for remote working, if not provided by the employer
• Training and technical assistance necessary to carry out remote work

The bill sets out three different ways to cover the costs of remote working: reimbursement of the costs incurred by the employee, payment of an allowance or a fixed lump sum. Many employers are now wondering which solution would be the best choice, not only financially but also logistically.

The first solution, namely the reimbursement of costs incurred by the employee, is the least practical. It entails monthly verification of the costs incurred by each employee working remotely, which may be quite a challenge, especially for large organisations.

The payment of the allowance involves an agreement between the parties to the employment relationship on the rules for the use of work materials and tools, including technical equipment necessary to carry out remote work by an employee, if they are not provided by the employer. Such a solution is feasible if the equipment to be used by the employee complies with safety requirements.

Introducing a fixed lump sum seems to be the most efficient for employers and miles better than the remaining two methods of cost settlement. To determine the amount of the fixed lump sum it will be necessary to take into account the expected costs incurred by the employee for remote working. They include, in particular: standards for materials consumption and work tools wear and tear, including technical equipment, their documented market prices and the amount of materials used for the employer's sake together with the market prices of such materials, as well as the electricity consumption standards and the costs of telecommunication services.

Thus, the employer can set the lump sum rate once and apply it for subsequent months. Then, the one thing left to pay attention to is the number of days worked remotely by an employee in a given month. The best course of action would be to calculate the lump sum based on the length of remote working. The less work is done remotely, the fewer costs it will generate for a remote employee, which must be taken into account in the cost calculation. It is also suggested that it will be possible to proportionally reduce the lump sum by the number of days not worked by the employee in a given month.

Even if employers provide remote working tools to employees but do not cover the costs incurred by an employee (such as for installation, service, operation, maintenance of work tools, as well as electricity and internet use or other necessary costs), they would still be required to pay the lump sum.

One of the recommended methods for calculating the electricity lump sum is to determine the average electricity consumption of a given electrical device per hour and then multiply this value by the average number of working hours per month. The resulting value should then be multiplied by the average electricity prices for households.

The cost of telecoms services can be approached in two ways. First, an employee can be provided with mobile internet, which makes the question of a lump sum irrelevant. The second and more recommended solution is to calculate to what extent an employee uses their internet connection for work and to reimburse the cost proportionately. Calculations should be based on the average cost of internet connection of an average speed in the area.

Materials and work tools for remote working provided by the employer and the reimbursed amount for the costs of remote working, as well as the payment of an allowance or a lump sum, will not constitute employee income within the meaning of the PIT Act. Therefore, it is exempt from tax and social security contributions.

The obligation to cover the costs of remote working is not the only expense that awaits employers in the near future. New employee entitlements resulting from the forthcoming transposition of the EU directives on Work-Life Balance and transparent and predictable employment conditions into the Polish legal system will also affect the financial situation of employers. Therefore, it is only rational to look for the most optimal and cost-effective solutions.