15. Provisions

Movements of provisions for the 12 months ended 31 December 2020 were as follows:

Movements of provisions for the 12 months ended 31 December 2019 were as follows:

Provisions for claims and litigation, risks and other charges

These provisions relate mainly to claims and litigation described in Note 30. As a rule, provisions are not disclosed on a case-by-case basis, as, in the opinion of the Management Board, such disclosure could prejudice the outcome of the pending cases.

Provisions for employment termination expense

On 12 December 2019, OPL S.A. concluded with Trade Unions the Social Agreement under which up to 2,100 employees are entitled to take advantage of the voluntary departure package in years 2020-2021. The value of voluntary departure package varies depending on individual salary, employment duration, age and year of resignation. The basis for calculation of the provision for employment termination expense is the estimated number, remuneration and service period of employees who will accept the voluntary termination until the end of 2021.

Increases of provisions for employment termination expense during 12 months ended 31 December 2019 included PLN 184 million of the estimated amount of termination benefits for employees scheduled to terminate employment in OPL S.A. under the 2020-2021 Social Agreement. Other movements of these provisions during the 12 months ended 31 December 2019 relate to termination benefits for employees scheduled to terminate employment under the 2018-2019 Social Agreement.

The discount rate used to calculate the present value of provisions for employment termination expense amounted to 0.11% as at 31 December 2020 and 1.49% as at 31 December 2019.

Dismantling provisions

The dismantling provisions relate to dismantling or removal of items of property, plant and equipment (mainly telecommunications poles and items of mobile access network) and restoring the site on which they are located.

Based on environmental regulations in Poland, items of property, plant and equipment which may contain hazardous materials should be dismantled and utilised by the end of their useful lives by entities licensed by the State for this purpose.

The amount of dismantling provisions is based on the estimated number of items that should be utilised/sites to be restored, time to their liquidation/restoration, current utilisation/restoration cost and inflation. The discount rate used to calculate the present value of provisions for dismantling amounted to 1.4% as at 31 December 2020 and 2.01% as at 31 December 2019.