Updated on: 2025/08/05 15:25 (UTC)
Overview
The main sources of employment law in the Czech Republic are the Labor Code and the Act on Employment.
Hiring
Employment Contracts
Employment contracts must be in writing and specify:
- the type of work the employee will perform,
- the place(s) where the employee will perform the work, and
- the date on which the employee will start working.
Other information can be included in the employment contract or in a job description provided by the employer to the employee within a month after employment begins. The contract may include provisions about holidays, termination, wages, working hours, and business trips.
A trial period of up to three months for rank-and-file employees and up to six months for managers may be specified and a noncompetition clause included.
An employer must familiarize employees with its code of conduct, legislation on occupational health and safety and any collective agreements in effect.
An employment relationship begins on the date specified in the employment contract. If an employee fails to begin work on the date agreed without good cause or fails to inform the employer of the reason for failure to report within a week, the employer may withdraw from the employment contract.
An employment relationship can be either open-ended or fixed-term. Fixed-term employment agreements may not exceed three years and can be renewed twice unless three years have passed since termination of the previous agreement.
An employer’s most important duty is to provide work for the employee, pay a wage or salary for the work done, create conditions for performance of work, and comply with other provisions of the law, the employment contract and internal regulations.
The duty of the employee is to perform work in accordance with the employment contract within scheduled weekly working hours.
Work performance agreements are contracts between the employer paying the wage and the employee performing the work. These agreements, which cannot exceed 300 hours per year, must be in writing and specify work to be done, hours to be worked, wages to be paid and duration of the agreement. Work performed outside the formal employment relationship cannot on average exceed half the normal working hours.
Restrictions on Hiring
Children under age 15 or those older than 15 who have not finished their compulsory school attendance generally cannot be employed except in artistic, cultural, advertising, or sporting activities.
The employer must keep a list of adolescent employees. Adolescents have the right to special consideration in the protection of their health and in their working conditions, to specific protections in collective bargaining agreements and to assistance in occupational training.
In addition, employers must create favorable conditions for the general development of adolescent employees’ physical and mental (intellectual) abilities by special adjustment of their working conditions.
Employers can only employ adolescents in jobs suitable for their physical and intellectual development and must devote special attention to their needs at work. With certain exceptions, employers cannot require adolescents to work overtime or at night.
Adolescents may not be employed underground in the extraction of minerals, in drilling tunnels or galleries or in any other jobs that might be hazardous or harmful to their physical or psychological health. Employers cannot employ adolescents in jobs that expose them to an increased risk of injury or in the performance of which they could put the safety and health of co-workers at risk.
Recordkeeping
The employer must keep records of each individual employee’s work-related injuries and hours worked, including overtime and night work.
Background Checks
Employers can ask for applicants’ criminal histories if relevant to the particular job and for job references. Employers must require that employees undergo a medical examination prior to actually starting work; if no such examination occurs, the employee shall be deemed incapable to perform work.
Noncompetition Agreements
Under Czech law, noncompete agreements are permissible between an employer and an employee and can remain in force for up to one year following termination of employment. Former employees are entitled to at least 50 percent of their average pay during the noncompete period.
The restriction on working for a competitor can be enforced by a penalty clause. The amount of the contractual penalty must be reasonable with regard to the conditions of the noncompetition clause. Generally, the penalty will be considered reasonable if it equals no more than twice the amount of the total remuneration paid for not competing.
Reference Citations
Employment Contracts: Labor Code, No. 262/2006 (as amended), §§ 34-35, 37, 39
Restrictions on Hiring: Labor Code, No. 262/2006 (as amended), §§ 316, 346a
Recordkeeping: Labor Code, No. 262/2006 (as amended), §§ 96, 105
Background Checks: Act on Specific Health Services, No. 373/2011 (as amended) (Czech)
Noncompetition Agreements: Labor Code, No. 262/2006 (as amended), § 310
Immigration and Work Permits
In General
A European Union citizen does not need a visa or other permit to be allowed to travel, live, and work in the Czech Republic. Nationals of other countries must secure either an EU Blue Card for highly skilled workers or an employee card for lesser skilled employees.
Visas and Work Permits
The Czech Republic has been a member of the European Union since 2004. The applicable rules regarding immigration and work permits are similar to those in other EU countries. An EU citizen does not need a visa or other permit to be allowed to travel, live and work in the Czech Republic.
For non-EU citizens, two types of work permits are available:
The EU Blue Card. This card combines a residence permit and a work permit into one document and is issued to applicants who:
- hold a university or college diploma from an educational program that had a duration of at least three years,
- have an employment contract for at least one year and
- have an agreed-upon gross monthly or annual salary amounting to at least 1.5 time the gross annual average salary in the country.
The Employee Card. This card also combines the residence permit and a work permit into one document, but the applicant does not have to meet any education or experience requirement. Instead, applicants must be non-EU nationals and:
- have an employment contract or an agreement on work activity and
- have an agreed monthly salary not lower than the basic rate of the monthly minimum wage and weekly working hours of at least 15.
Both cards are valid for up to two years but are extendable.
Forms
Application forms for work permits in the Czech Republic can be found here.
Reference Citations
Visas and Work Permits: Act on the Residence of Foreign Nationals in the Czecch Republic, No. 326/1999
Nondiscrimination
In General
Employers may not discriminate on the basis of race, ethnic origin, nationality, skin color, sex, sexual orientation, language, age, disability, religion and belief, or political opinions in working conditions, compensation, training, or opportunities for career advancement.
The Labor Code calls for equality of opportunity in employment for all employees.
Article 1 of the Charter of Fundamental Rights and Basic Freedoms states that people are free and equal in dignity and rights. The basic rights and liberties are inherent, inalienable and not subject to repeal. According to the charter, basic rights and liberties are guaranteed to all regardless of sex, race, skin color, language, faith/religion, political ideology or other opinion, national or social origin or ethnicity. This applies to the rights of employees, which also include the right to appropriate compensation and satisfactory working conditions.
The Czech Republic is a founding member of the International Labor Organization and has ratified core labor standard conventions, including: Forced Labor (Convention No. 29/1930, Act No. 506/1990 Coll.), Equality of Remuneration (Convention No. 100/1949, Act No. 450/1990 Coll.), Abolition of Forced Labor (Convention No. 105/1957, Act No. 231/1998 Coll.), Discrimination—Employment and Occupation (Convention No. 111/1958, Act No. 465/1990 Coll.), Worst Forms of Child Labor (Convention No. 182/1999, Act No. 90/2002 Coll.) and many others.
According to the Labor Code, employers must safeguard equal treatment for all employees regarding working conditions, remuneration for work and other compensation in cash and in kind, vocational training and opportunities for career advancement.
Employers are obliged to provide equal treatment, which means adoption of measures that are a precondition for effective protection against discrimination and that can be required, taking into consideration good morals, given circumstances and personal situation. The Anti-Discrimination Act provides for remedial measures relating to protection against discrimination in labor relations.
Generally, difference of treatment on grounds of sex, sexual orientation, age, disability, religion and belief or opinions in certain matters does not constitute discrimination, if the difference of treatment is objectively justified by a legitimate aim and the means of achieving that aim are appropriate and necessary.
According to the Labor Code, discrimination does not mean different treatment resulting from legitimate business considerations or the nature of the work. In this context, however, different treatment can only be justified if based on a substantial and decisive occupational requirement. Discrimination will also not be deemed to occur when measures are instituted to prevent or equalize disadvantages resulting from an individual’s belonging to one of the groups specified by the Anti-Discrimination Act.
The Supreme Court has held that employees performing the same work must receive the same salary even if they are working in different regions of the country.
Employers can be fined for requesting that employees disclose information irrelevant to the employment relationship, including information that could be used for discrimination.
Disability Discrimination
Under Act No. 435/2004 Coll., Employment of the Disabled, disabled individuals have the right to enhanced protection of their health at work and to special working conditions. Employers, if more than half of their workforce is composed of disabled employees, qualify for government subsidies.
Employers with more than 25 employees must employ disabled persons to include at least 4 percent of their total workforce. Alternatively, employers can purchase products or services from companies whose workforces include more than 50 percent disabled employees or make payments to the state budget.
Gender Discrimination
Generally, any discrimination on the grounds of sex is prohibited. This includes discrimination because of pregnancy, maternity (or paternity) and sexual identification.
The Labor Code provides for special treatment of women due to their social role as mothers. Female employees generally cannot be employed underground in the extraction of minerals or the digging of tunnels and galleries or in jobs that could endanger their maternity. The Labor Code contains specific working conditions for female employees, employee mothers, breast-feeding employees and employees providing care for children. Special conditions for male employees providing care for children apply as well.
Under the Anti-Discrimination Act, harassment is prohibited and includes any unwanted conduct with the purpose or effect of diminishing the dignity of a person and creating an intimidating, hostile, degrading, humiliating or offensive environment. Such conduct can be associated with race, ethnic origin, nationality, sex, sexual orientation, age, disability, religion and belief or opinions. Sexual harassment is any harassment with a sexual nature. Employers are obliged to adopt measures for effective protection against discrimination, including harassment and sexual harassment.
EU Pay Transparency Directive: As a member state of the European Union, the Czech Republic has until June 2026 to transpose the minimum requirements of the EU Pay Transparency Directive into its national law or amend any current pay equity laws to conform with the directive, which aims to promote pay equity between men and women. The directive introduces requirements on gender pay gap reporting, salary history bans during the hiring process, and wage disclosure in job vacancy listings. The national law may go beyond the minimum requirements of the directive, but the law may not directly conflict with the directive requirements.
Reference Citations
Nondiscrimination: Labor Code, No. 262/2006 (as amended), § 16 ; Anti-Discrimination Act, No. 198/2009 (as amended) §§ 2-3
Disability Discrimination: Act on Employment, No. 435/2004 (as amended) §§ 8a, 81
Gender Discrimination: Anti-Discrimination Act, No. 198/2009 (as amended) § 4; Labor Code, No. 262/2006 (as amended), § 319 (Czech)
Employee Privacy
Employee Data
On May 25, 2018, the General Data Protection Regulation (GDPR) superseded the Data Protection Directive as the primary law governing data privacy in the EU. The GDPR establishes minimum requirements for the processing of employee data and allows EU member nations to introduce more restrictive local legislation. Stricter requirements can also be established in collective bargaining agreements or work contracts. For more information, see the In Focus: International Privacy Laws.
In 2019, the Czech Republic enacted a law that fully replaces the current Czech Data Protection Act and includes several local derogations and exceptions to the GDPR.
Employee Monitoring and Surveillance
Employers cannot violate employees’ privacy in the workplace by open or concealed monitoring (surveillance), interception (including recording) of their telephone calls, or inspection of their mail (including email) except when necessary for the type of activity being carried out. If monitoring is unavoidable, the employer must expressly notify employees of the scope and methods of its implementation.
Employers can be fined for failing to notify employees of concealed video monitoring, recording of telephone calls, or inspection of e-mail.
Under the GDPR, employers can monitor employees only if there is a lawful basis for doing so. Lawful bases can include preventing employee misconduct, deterring crime, and ensuring compliance with health and safety procedures. Employees must be given prior notice, and any data that is collected must be used and kept only to fulfill its original purpose.
Reference Citations
Employee Data: General Data Protection Regulation, 2016
Employee Monitoring and Surveillance: Labor Code, No. 262/2006 (as amended), § 316 ; General Data Protection Regulation, 2016
Compensation
Hours of Work
The Labor Code’s provisions on working time are based on the International Labor Organization Convention and on European Union directives.
Regular hours of work may not exceed 40 in a week.
Certain categories of employees have shorter weekly working hour limits, including 37.5 for employees working underground in the mining industry or for employers with continuous or three-shift work regimes and 38.75 for employees working for employers with two-shift work regimes.
Employees must be given a break of at least 30 minutes to eat and rest after they have worked for six consecutive hours, four and a half hours in the case of underage employees. The break cannot be provided at the beginning or end of the working hours.
Uninterrupted rest breaks between two shifts must be at least 11 hours within each consecutive 24 hours. Uninterrupted rest in a week must be at least 35 hours within every period of seven successive calendar days.
Minimum Wage
Effective Jan. 1, 2024, the minimum monthly wage is 18,900 koruna based on a 40-hour workweek. Effective Jan. 1, 2025, the minimum monthly wage increases to 20,800 korunas based on a 40-hour workweek.
Under the Labor Code, employees are entitled to at least 10 percent more than their regular wages for working at night and on weekends. The rate is subject to collective bargaining and internal rules.
Employees working in arduous environments are also entitled to a wage supplement of at least 10 percent (of the minimum wage set by decree), which may be raised (but not lowered) by government decree.
Employees performing the same work must receive the same salary even if they are working in different regions of the country.
Overtime
Overtime is generally permitted up to eight hours per week and 150 hours per year. With the consent of the employee, additional overtime is allowed, provided the overtime in a working week does not exceed eight hours on average during a period of 26 weeks.
For overtime work, employees are entitled to a premium of at least 25 percent of their average earnings in addition to regular wages. The employee may agree to take compensatory time off instead of premium payments.
Managerial employees can agree to have overtime wages included in their regular pay. Rank-and-file employees can agree to have their wages include compensation for up to 150 hours of overtime per year.
Wage Payment
Employers must pay wages at least monthly and must provide employees with a written wage statement indicating the applicable pay rate, pay grade, pay day, wages paid, and deductions withheld. Wages must be paid in legal tender and, unless agreed otherwise with the employee, at the workplace during work hours.
Mandatory Bonuses
Bonus schemes are common in the Czech Republic, but there are no specific regulations or standards that govern them.
Reference Citations
Hours of Work: Labor Code, No. 262/2006 (as amended), §§ 79, 83, 88, 92, 94
Minimum Wage: Ministry of Labor and Social Affairs Decree (Czech)
Overtime: Labor Code, No. 262/2006 (as amended), §§ 93, 114
Wage Payment: Labor Code, No. 262/2006 (as amended), § 141-147
Benefits
Vacation
Leave is calculated in hours as a multiple of the basic amount of annual leave, the employee’s set weekly working hours and the number of weeks in a calendar year. Employee who work a full year with 40 hours as set weekly working hours are entitled to 160 hours of annual leave. Employees who have not worked for the employer for the entire calendar year are entitled to a proportional part of the annual leave if they work for the employer for at least four weeks. In such cases, employees are entitled to 1/52 of their total annual leave entitlement for the calendar year for each week worked.
The employer, in agreement with the trade unions, may determine when the leave will be taken. Employers must notify workers about their vacation schedule at least two weeks in advance. If the employer fails by June 30 of the next calendar year to specify when holidays will be taken, the employee has the right to specify when his or her holiday is to be taken.
Holidays
The law establishes 12 public holidays: seven national holidays and five others. These are all rest days. National holidays are intended to celebrate Czech statehood, whereas the other holidays are related to particular historical events.
Employees are entitled to the following 12 holidays:
- Jan. 1: New Year/The Day of Restoration of Czech Independence
- Easter Monday
- May 1: Labor Day
- May 8: Liberation Day
- July 5: Saints Cyril and Methodius
- July 6: Jan Hus Day
- Sept. 28: St. Wenceslas Day
- Oct. 28: Independent Czechoslovak State Day
- Nov. 17: Struggle for Freedom and Democracy Day
- Dec. 24: Christmas Eve
- Dec. 25: Christmas Day
- Dec. 26: St. Stephen’s Day
Employees who are required to work on a holiday are entitled to either a compensatory day off or compensation equal to 200 percent of their pay.
Holidays are always observed on the day on which they fall, even if they fall on a weekend. Holidays are not moved to the nearest Monday, nor do workers get a free day in compensation for a holiday falling on a non-work day.
Maternity Leave
Female employees are entitled to 28 weeks of maternity leave, 37 weeks in cases of multiple births. It is obligatory to take 14 weeks, including at least six weeks after the birth. Employees on maternity leave receive about 70 percent of their salary from the state. Maternity leave may begin no earlier than the beginning of the eighth week before the expected date of birth.
Mothers of stillborn children are entitled to 14 weeks of maternity leave. Mothers of adopted children are entitled to 22 weeks of maternity leave, which is extended to 33 weeks in the case of multiple adoptions.
Mothers must have worked 270 days of covered employment during the two years prior to the start of paternity leave.
Employees cannot be terminated or suspended during the six-week period after childbirth. The employer may not give notice to a female employee during a period in which she is pregnant or on maternity leave unless the company is closing down.
A female employee who works normal weekly hours is entitled to two half-hour breaks per shift for each child until the child reaches the age of 1 year and to one half-hour break per shift in the subsequent three months.
If a female employee works part-time (but at least half of normal weekly working hours), she is entitled to one half-hour break for each child until the child reaches the age of 1 year.
If a pregnant employee who works at night requests to be transferred to day work, the employer must comply with her request.
Paternity Leave
Fathers are entitled to seven days of paid leave within six weeks of the birth or adoption of a child. Employees on paternity leave will receive about 70 percent of their salary from the state. Fathers must have worked 270 days of covered employment during the two years prior to the start of paternity leave.
Sick Leave
If an employee becomes incapable of work due to sickness or injury, the employer must pay sickness benefits up to the fourth to the 14th day of work incapacity. The sickness benefit is equal to 60 percent of the employee’s average wage. During the first 14 days of an employee’s inability to work, employers are permitted to check that the worker is following a physician’s instructions. If employees violate the prescribed regimen, employers can reduce sick benefits or, in the case of a gross breach, refuse to pay them at all.
The government pays sick benefits from the 15th day of work incapacity.
Other Leave
Parental leave. Mothers and fathers may be eligible for parental leave up to the child’s third birthday. A parental benefit is available to parents who meet the eligibility requirements; eligible parents can work full-time or part-time while receiving the benefit. Parents can take parental leave simultaneously, but only one is entitled to the parental benefit.
Personal leave. Governmental Decree No. 590/2006 Coll. sets out a list of events for which an employee must be granted time off. These include medical examinations, weddings and the birth of a child, as well as deaths and funerals within the immediate family. In addition, employers must grant their employees leave for performance of public office and other duties of public interest if employees cannot perform these activities outside working hours.
Employees are automatically granted leave to perform compulsory army service and to attend training related to employment.
Pensions and Social Security
Employers in the Czech Republic are responsible for Social Security and workers’ compensation withholding and payments. Social Security is administered by the Czech Social Security Administration and includes a pension insurance fund, the state unemployment policy fund and the sickness insurance fund.
Employees also are eligible for voluntary pension insurance, a program where a portion of participant contributions to the District Social Security Administration is allocated to a private insurance company.
Worker’s Compensation
Worker’s compensation is administered by the Czech Social Security Administration.
Employers make contributions to the worker’s compensation fund every three months, the amount of which varies depending on industry and assessed risk levels.
Reference Citations
Vacation: Labor Code, No. 262/2006 (as amended), §§ 217-219
Holidays: Act on National Holidays, No. 245/2000 (as amended), §§ 1-3 (Czech); Labor Code, No. 262/2006 (as amended), § 115
Maternity Leave: Labor Code, No. 262/2006 (as amended), § 195
Paternity Leave: Labor Code, No. 262/2006 (as amended), §§ 196, 198
Sick Leave: Labor Code, No. 262/2006 (as amended), § 115 ; Act No. 32/2019 Coll.
Other Leave: Governmental Decree Establishing the Range and Extent of Other Important Obstacles at Work, No. 590/2006 (Czech)
Labor Relations
In General
The right to join a trade union is one of the fundamental constitutional rights. Under Czech law, trade unions and works councils are the only legitimate employee representatives in dealings with employers. The Collective Bargaining Act only allows strikes aimed at the conclusion of collective agreements
In cases where a business is sold or transferred, the successor employer becomes responsible for its predecessor’s rights, privileges and duties towards the employees under the collective agreement.
Right to Organize
The Act on Collective Bargaining (No. 2/1991 Coll.) establishes the right to collective bargaining and regulates the process of concluding and implementing collective agreements, the conduct of strikes and lockouts and the process of resolving collective disputes.
The Czech Bill of Fundamental Rights and the Civil Code enable persons to establish trade unions as private associations.
Everyone has the right to associate in trade unions, as the right of association is one of the fundamental constitutional rights. The number of trade unions cannot be limited nor can any trade union be given preferential treatment in a particular enterprise or sector of industry.
The Czech-Moravian Confederation of Trade Unions (CMKOS) is the largest central trade union in the Czech Republic and an important partner in tripartite negotiations (unions/employers/government) within the framework of the Council for Economic and Social Agreement of the Czech Republic. The confederation operates locally through Regional Councils of Trade Unions and Regional Offices for Legal Assistance. CMKOS is a member of the International Trade Union Confederation, the European Trade Union Confederation and the Trade Union Advisory Committee to the Organization for Economic Cooperation and Development.
Works Councils
Under Czech law, trade unions and works councils are the only legitimate employee representatives in dealings with employers.
The employer is obligated to provide the works council, trade union representatives or occupational safety and health representatives with rooms and equipment necessary to exercise their functions and to cover costs relating to maintenance, technical operations and necessary documentation.
The Labor Code also contains provisions for the implementation of European Works Councils, which enable employees of multinational companies meeting certain conditions to have access to information regarding the company and to discuss it with the employer.
Works councils can only mediate between employers and employees and enforce the employees’ right to information and consultation. They cannot negotiate with legal effect on behalf of employees nor can they conclude collective agreements. Unlike trade unions, works councils cannot create higher-level structures and cannot participate in tripartite talks that include government, trade unions and employers.
Dispute Resolution
The Collective Bargaining Act only allows strikes aimed at the conclusion of collective agreements. Strikes instigated to enforce obligations under an existing agreement are unlawful. Such disputes must be resolved through mediation or, should that fail, arbitration with the right of judicial appeal.
Strikes and Lockouts
The right to strike is guaranteed by law (except for certain groups of employees such as judges, prosecutors and members of the armed forces or security corps).
The Collective Bargaining Act only permits strikes and lockouts as a last resort to settle a collective dispute. The legislation defines a strike as a partial or total interruption of work on the part of employees. A lockout is defined as a partial or total interruption of work enforced by employers. A special type of work stoppage, the solidarity strike is an action in support of employees striking in a dispute over the conclusion of another collective agreement.
Strikes not involving collective bargaining can be lawful if organized to protect other employee economic or social interests.
Successorship Clauses
In cases where a business is sold or transferred, the successor employer becomes responsible for its predecessor’s rights, privileges and duties towards the employees under the collective agreement.
Reference Citations
Right to Organize: Act on Collective Bargaining, No. 2/1991, §§ 2, 4 (Czech)
Works Councils: Labor Code, No. 262/2006 (as amended), §§ 281-285
Dispute Resolution: Act on Collective Bargaining, No. 2/1991, §§ 10-15 (Czech)
Strikes and Lockouts: Act on Collective Bargaining, No. 2/1991, § 16 (Czech)
Successorship Clauses: Labor Code, No. 262/2006 (as amended), §§ 338-339
Safety, Health and Security
In General
Employers must actively work to protect employees from workplace injuries and disease by eliminating risks or protecting employees against them,
The Labor Code bars the use of alcohol, drugs, or tobacco products in the workplace and requires employees to undergo drug tests if necessary.
Workplace Safety and Health
Employers must actively work to protect employees from workplace injuries and disease. They must identify workplace risks, classify them, determine their causes and eliminate them as far as possible; keep prescribed records (such as documentation on risk classification, injuries in the workplace and occupational diseases); and adopt measures to be implemented in specific contingencies (such as serious breakdowns or fires). Employers cannot allow employees to carry out prohibited work or perform work inappropriate to their abilities or state of health. Employers must assign specific employees to coordinate first aid and evacuation and to notify emergency medical services, firefighters or police when required.
If occupational risks cannot be eliminated, employers must provide employees with personal protective equipment (e.g. safety helmets and welding goggles). In a working environment where clothing or footwear is subject to unusual wear or soiling or has a protective function (e.g. mining, construction, medical or food services), employers must provide employees with suitable work clothes and/or footwear. When working conditions require, employers must provide employees with washing agents, detergents and disinfectants. In special cases, beverages must be provided.
Employees also have an obligation to protect their own and co-workers’ health and safety.
In particular, employees are obligated to:
- take part in training provided by employers and aimed at occupational health and safety protection, including tests of employee knowledge;
- undergo compulsory medical examinations;
- comply with the statutory provisions and other regulations and employers’ instructions concerning occupational health and safety;
- observe the established working procedures and properly use the prescribed tools and machines, means of transportation and personal protective equipment;
- inform supervisors of any irregularities at the workplace that could endanger the health or safety of employees and
- immediately inform supervisors of an injury at work.
There is a large body of specific legislation regulating occupational health and safety protection for each specific type of work, ranging from extremely dangerous undertakings such as nuclear power or chemical processing plants through the “middle category” of construction sites, factories and transportation to “safe” undertakings such as restaurants, hotels, offices and shops.
Drug and Alcohol Use
The Labor Code expressly bars employees from consuming alcohol (except in specific cases) or abusing addictive substances such as drugs in the workplace and/or during working hours.
Employees must agree to undergo tests when required by the employer to establish whether the worker is under the influence of drugs or alcohol. Refusal to undergo such tests can be considered a breach of employment-related duties and can be grounds for termination.
Employees are prohibited from smoking in the workplace and other premises where nonsmokers would be exposed to the effects of smoking. In addition, smoking is prohibited in some public places, including public transport vehicles, schools, restaurants (under certain conditions), theatres, hospitals and buildings of state administrative bodies.
Reference Citations
Workplace Safety and Health: Labor Code, No. 262/2006 (as amended), §§ 101-105
Drug and Alcohol Use: Labor Code, No. 262/2006 (as amended), § 106
Termination
Termination by Employer
Employers can immediately terminate an employment relationship only if:
- an employee has breached some duty in an especially gross manner or
- an employee has been sentenced for a willful criminal offense to more than one year’s imprisonment or imprisonment of not less than six months for a willful criminal offence committed during performance of work or directly connected to work.
An employer can immediately terminate the employment relationship only within two months of the day on which the employer learned of the reason for giving notice and within one year of the day the reason for the notice arose. Restrictions apply to the immediate termination of pregnant employees and employees on maternity or parental leave.
Immediate termination of an employment relationship must be made in writing stating explicitly the reason for termination and delivered to the other party.
Under the Labor Code, an employment relationship can only be terminated by:
- notice of termination,
- immediate termination if the employee breaches working discipline in an especially gross manner,
- mutual agreement,
- termination during a trial period, or
- death of the employee.
Termination by mutual agreement is possible at any time. In this case, there is a lower risk that the employee will challenge the termination in court. Upon the request of the employee, the agreement must state the reasons for the termination.
Under the Labor Code, either the employer or the employee may terminate the employment relationship by giving notice of termination. The notice must be in writing and delivered to the other party. An employee may give notice of termination to the employer without stating any reason. An employer may only give notice of termination to an employee for a reason explicitly stated in the Labor Code. The specific grounds for termination must be set out in the notice of termination; otherwise, the notice is invalid.
An employer may terminate employment for organizational reasons if:
- the employer’s enterprise or part of it shuts down,
- the employer’s enterprise or part of it relocates or
- the employee becomes redundant owing to the decision of the employer to change its activities, to reduce the number of employees for the purpose of increasing labor productivity (efficiency) or to introduce other organizational changes (restructuring).
If termination is due to elimination of the position, the position must remain vacant.
Other grounds for termination include the following:
- The state of the employee’s health—confirmed by a medical expert or a ruling by the state health administration authority—is such that he or she can no longer carry out the job.
- The employee does not meet the requirements prescribed by statutory provisions for the job. If the employee’s failure to fulfill these requirements results in unsatisfactory performance and if the employer directed the employee (in writing) to rectify the situation within the last 12 months but the employee has not done so within a reasonable period of time, the employee may be given notice of termination.
- Grounds exist upon which the employer may immediately cancel the employment relationship if the employee has seriously breached some duty arising from a statutory provision related to the work. In the case of ongoing but less serious breaches of duties related to work, the employee may be given notice of termination provided that the employer advised the employee of this possibility in writing in the last six months.
- An employee on sick leave refuses to follow a physician’s instructions.
The employment relationship terminates on expiration of the notice period.
The notice period is two months starting on the first day of the month following delivery of the notice of termination or longer by mutual agreement.
If an employee submits a notice of termination in connection with an upcoming transfer to another employer (e.g., in cases of merger or acquisition), the employment relationship ends on the day before the transfer.
The Labor Code sets out a “protection period,” during which employers are prohibited from serving a notice of termination to certain groups of employees—for example, those who are temporarily incapable of working, are taking part in military service or exercising a public office or are pregnant or on maternity or parental leave.
When dismissing employees, employers must report the following information to the District Social Security Administration (DSSA):
- type of employment;
- duration of employment;
- period of pension insurance;
- the average or likely monthly net earnings;
- the severance or redundancy pay entitlement, including whether it has been paid; and
- the manner and reason for the dismissal.
Employers must provide the information to the DSSA within eight days of dismissing the employee. Failure to do say may result in a fine of up to 20,000 koruna.
Termination by Employee
Employees can terminate their employment immediately if they cannot perform their work without serious threat to their health and they were not transferred to suitable alternative work by the employer or if they have not been paid for work performed.
Immediate termination of an employment relationship must be made in writing stating explicitly the reason for termination and delivered to the other party.
In addition, the employee may serve a termination notice without cause.
Plant Closings and Mass Layoffs
A collective dismissal occurs if over a period of 30 days an employer terminates:
- at least 10 employees out of a workforce of 20 to 100,
- at least 10 percent of employees out of a workforce of 101 to 300 employees, or
- at least 30 employees out of a workforce of over 300.
Collective dismissals generally occur when an employer closes or relocates its operations in whole or in part or when it decides to change its activities, reduce the number of its employees to increase efficiency or introduce other organizational changes.
Employers must inform the relevant trade union organization or works council at least 30 days in advance of a collective dismissal and negotiate possible measures to mitigate the impact of the layoffs. Where there is no collective body, the individual employees must be informed.
The information that must be provided includes:
- reasons for the dismissals,
- number and qualifications of employees to be made redundant,
- number of employees employed by the employer and their qualifications,
- period within which the dismissals must take place,
- criteria for selecting employees to be made redundant and
- severance pay and other rights of the redundant employees.
The employer’s obligation is to inform rather than to reach agreement with the union or works council.
Employers must notify the competent labor office in writing of the reasons for collective dismissals, the total number of employees and the categories of employees involved, the qualifications of the employees affected, the period during which dismissals will occur, the criteria proposed for selecting employees who are to be made redundant and the date when negotiations with the competent trade union or works council started.
Payment on Termination
The Labor Code regulates severance pay.
If an employer gives notice of termination to employees because of reorganization (i.e., closing or relocation of all or a part of the employer’s business) or because the employees have become redundant, the employer must pay employees with less than a year’s service one month’s average wages as severance pay, employees with one year’s service twice their average monthly earnings, and employees with over two years’ service triple their average monthly earnings (in addition to paying the affected employees during the two-month termination period).
An employee who terminates employment because of a transfer resulting in a deterioration of working conditions is entitled to severance pay.
In case of termination of employment due to an employee’s loss of ability to work because of work injuries or occupational disease or due to the risk of an occupational disease (confirmed by a medical certificate), employers must pay severance equivalent to 12 months’ average wages. These amounts can be increased (but not decreased) by a collective agreement or internal rule.
Unemployment Insurance
To claim unemployment benefits, an individual must have worked and made social insurance contributions for at least 12 months over the last three years.
Individuals also must be able to declare that they have no other forms of income, no severance pay outstanding, no income abroad, no businesses or directorships and no impediments to work.
Reference Citations
Termination by Employer: Labor Code, No. 262/2006 (as amended), §§ 51-61
Termination by Employee: Labor Code, No. 262/2006 (as amended), §§ 51, 56
Plant Closings and Mass Layoffs: Labor Code, No. 262/2006 (as amended), §§ 62-63 (Czech)
Payment on Termination: Labor Code, No. 262/2006 (as amended), § 67
Personal Taxes
Residency Requirements
Individuals are considered Czech tax residents if they have a permanent home address in the Czech Republic or spend at least 183 days in a calendar year in the country.
Taxable Income
Tax residents are subject to Czech personal income tax on their worldwide income, nonresidents on their Czech-sourced income only.
The value of certain employer-provided benefits is excludible from income. These include employer contributions to employee pension and life insurance plans, the value of personal development programs, the sale of shares (with certain qualifications) and the value of employer-provided leisure, cultural, health care, educational, sport and vacation facilities. In some cases, there is a limit on the value of these benefits excludible from income.
Tax Rates
An income tax rate of 15 percent is assessed on income of up to 48 times the applicable average wage in the country, and an income tax rate of 23 percent is assessed on income of more than that threshold.
Reference Citations
Residency Requirements: Czech Income Tax Act, No. 586/1992 (as amended), § 2
Web References
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