situation as of 28 April 2025

 

The so-called flexible amendment to Act No. 262/2006 Coll., the Labour Code, as amended (the “Labour Code“), has undergone almost entire legislative process in the Czech Republic. The amendment introduces a number of changes, which will be discussed in this article.

 

However, it must be emphasised that the amendment is not yet in force as it is yet to be published in the Collection of Laws of the Czech Republic, i.e. after approval by the Chamber of Deputies of the Czech Republic on 7 March 2025, after approval by the Senate of the Czech Republic on 9 April 2025 and signature by the President on 25 April 2025. The amendment could thus come into force as early as July or August 2025.

 

Generally speaking, the amendment preserves the principle of so-called flexicurity by introducing changes that will make the performance of work more flexible from the employer’s point of view, but also reflect the need for some flexibility in employment relations from the employees’ perspective. If employers adapt to the changes brought about by this amendment to the Labour Code, it will be an opportunity for them to make the employment of their employees more efficient.  

 

 

 

1. ACCELERATION OF TERMINATION PROCESSES AND OTHER RELATED CHANGES

 

1. BEGINNING OF THE NOTICE PERIOD

Under the new legislation, the notice period would start to run from the very delivery of the notice to the recipient, not from the first day of the month following the delivery of the notice, as is the case now.

 

For example, if an employer gives notice to an employee and the notice is delivered to the employee on 10 February 2025, then the employee’s notice period will not start until 01 March 2025. However, according to the amendment to the Labour Code, the employee’s notice period would start from the delivery of the notice, i.e. from 10 February 2025.

 

 

1. SHORTER TERM OF NOTICE PERIOD FOR CERTAIN TERMINATION REASONS

According to the Labour Code, the notice period for termination of employment is at least 2 months.

 

The amendment to the Labour Code introduces a new rule that when an employer gives notice for the following reasons, the notice period will now be 1 month. These are the grounds for termination under the provisions of Section 52(f) to (h) of the Labour Code:

 

(f) where the employee does not meet the prerequisites for the performance of the work if he has been notified in writing within the last 12 months to rectify the situation and has failed to do so within a reasonable period of time,

 

(g) for reasons for which the employer could immediately terminate the employment relationship of the employee, or for serious misconduct or ongoing but less serious instances of misconduct by the employee, if the employee has been notified in writing of the possibility of termination within the last 6 months,

 

(h) if the employee breaches another obligation pursuant to section 301a in an especially gross manner (in the case of failure to comply with a specified regime for a temporarily incapacitated insured person).

 

As regards the other grounds for notice, the minimum notice period will continue to be 2 months.

 

However, this new regulation does not change the fact that the employer and the employee can still agree, either within the employment contract or separately, a notice period longer than the statutory minimum.

 

1. EXTENSION OF TIME LIMITS FOR EMPLOYEES IN CONNECTION WITH TERMINATION GIVEN TO THE EMPLOYEE

In cases of termination of employment given by the employer pursuant to Section 52(g) of the Labour Code, the employer may give notice to the employee only if the specified time limits are complied with. Thus, the employer may give notice to the employee only within 2 months from the date on which the employer became aware of the reason for the termination, and if the violation occurs abroad, the employer may do so no later than 2 months after the employee’s return from foreign travel. However, at the latest, the employer may give notice to the employee within 1 year from the date on which the reason for termination or immediate termination of employment arose. The amendment to the Labour Code extends these time limits for employers by introducing a period of 3 months instead of 2 months and a period of 15 months instead of 1 year.

 

 

 

 

 

1. TERMINATION WITHOUT REASON

In the context of the amendment to the Labour Code, we would also like to point out for completeness that the publicly discussed termination of employment given by an employer without giving a reason was not approved and is therefore not part of the proposed amendment to the Labour Code.

 

1. TERMINATION REASONS IN CONNECTION WITH THE EMPLOYEE’S HEALTH

The amendment to the Labour Code introduces a new definition and unification of termination grounds for health reasons on the part of the employee. This will be the provision of Section 52(d) of the Labour Code (the employee has lost the ability to continue his/her work for a long time due to his/her health condition) and the provision of Section 52(e) of the Labour Code (if he/she has reached the maximum permissible exposure at the workplace determined by a decision of the competent public health authority). In the event of termination under Section 52(e) of the Labour Code, the employee is entitled to severance pay of at least 12 times the employee’s average earnings. A change then comes in the case of termination under Section 52(d) of the Labour Code, where the employee is now not entitled to severance pay, but is entitled to a single payment of 12 times the average monthly earnings of the employee concerned. This change is to be introduced at the same time as the change in the public health insurance scheme, as this compensation should be paid by the insurance scheme and not by the employer.

 

 

2. LONGER PROBATIONARY PERIOD AND THE POSSIBILITY OF AN ADDITIONAL EXTENSION OF THE PROBATIONARY PERIOD

The employer and the employee may agree on a probationary period in the employment relationship. The probationary period may not be longer than 3 months and, in the case of management staff, may not be longer than 6 months. There is also a restriction that the probationary period may not be longer than one half of the agreed duration of the employment relationship. During the probationary period, both the employer and the employee may terminate the employment relationship without giving any reason. According to the planned amendment to the Labour Code, the probationary period may be agreed for up to 4 months, and up to 8 months for management employees. However, the restriction that the probationary period in a fixed-term employment relationship may not last longer than half the duration of the agreed employment relationship and that it must be agreed at the latest at the beginning of the employment relationship continues to apply. 

 

A longer probationary period will only be possible for new employees, as under the Labour Code, the probationary period can be agreed no later than the day the employee starts work. It will now be possible to extend an already agreed probationary period at the start of the employment relationship, within the limits of the maximum permissible probationary period mentioned above and subject to the written consent of the employee. Under the current legislation, on the other hand, the probationary period cannot be further extended.

 

3. PAYMENT OF WAGES – PREFERENCE FOR CASHLESS TRANSFERS, WAGES IN FOREIGN CURRENCY

The amendment to the Labour Code will no longer require the employee to give explicit consent for his/her wages to be sent to him/her in cashless form. Cashless payment of wages will thus become the primary form of payment when remunerating an employee. In the event of the employee’s express disagreement with the non-cash payment of wages, or in the event of any other impediment (e.g. the employee does not have a bank account), the employer will pay the employee in cash, at the workplace and during working hours.

 

It will now be possible to pay wages in foreign currency to a wider range of employees, with their consent. The condition for the possibility of paying wages in foreign currency will not only be the place of work abroad, but also for example:

 

• if the employee is a citizen of another EU country and is not also a citizen of the Czech Republic and does not have permanent residence in the Czech Republic, or
• if the employee lives permanently abroad or pays the living expenses of himself or his family members there, or
• if he or she is a foreigner or a stateless natural person who performs work in the Czech Republic on the basis of an employment permit, an employment card or a long-term residence permit for the purpose of performing employment requiring high qualifications.

 

It will still be possible to pay an employee’s salary only in the foreign currency to which the exchange rate is announced by the Czech National Bank. The above means an extension of the cases in which an employee can be paid in a foreign currency, but it does not mean that this can only be agreed with the employee without meeting other conditions.

 

 

4. PART-TIME JOBS DURING THE SUMMER HOLIDAYS ALREADY FROM 14 YEARS OF AGE

Until now, minors have been able to work under the condition of reaching the age of 15 and completing compulsory schooling. If a minor did not meet one of these conditions, the performance of work was prohibited. The amendment to the Labour Code breaks these rules and allows minors to work from the age of 14, either under an employment contract or under an agreement for work outside the employment relationship, but only during the main summer holidays. This is subject to the written consent of the person’s parent/legal representative. Completion of compulsory schooling is no longer a requirement.

 

A special working regime has also been introduced for a new category of juvenile employees, i.e. juvenile employees who have reached the age of 14 but have not yet fulfilled the conditions for reaching the age of 15 and completing compulsory schooling. These employees will only be allowed to perform light work and will be allowed to work, up to 7 hours per day and a maximum of 35 hours per week. For the remaining juvenile workers, the daily limit for work is still 8 hours and the weekly limit is 40 hours.

5. DECREASE IN ENTRY CONDITIONS

For non-hazardous occupations, i.e. occupations in the first category of occupational health and safety (e.g. typically administrative work), employees will no longer be required to undergo a mandatory initial occupational health examination. However, the regime of periodic occupational health examinations remains unchanged.

 

 

6. DELIVERY OF THE WAGE STATEMENT

The employer will now be able to deliver the wage statement to the employee within the employer’s internal system to the employee’s electronic address or company e-mail without the employee’s special consent. The wage statement will be delivered when the employee acknowledges receipt in writing. If the employee does not confirm this within 15 days of the date of dispatch, then the delivery will not be deemed effective.

 

In any case, the employee must be informed of the wage conditions before starting work.

 

 

7. PARENTS AS EMPLOYEES

Based on the amendment to the Labour Code, employees on parental leave will be able to continue to perform the same work for their employer as they did in their main employment before taking parental leave, on the basis of an agreement on work performed outside an employment relationship. This is an exception to the rule that an employee is prohibited from performing the same type of work for the employer in a subsequent employment relationship.

 

If the parent returns to work within two years of the child’s age, he or she will be guaranteed a return to the original position by the employer. Until now, such entitlement has only been guaranteed for a return after maternity leave, and not for a return after parental leave.

 

The amendment also allows for the unlimited extension of fixed-term contracts for those employees who will be replacing employees on maternity or parental leave. The “three times and stop rule”, i.e. the rule according to which an employment relationship agreed for a fixed period can be extended for a further fixed period no more than twice, will therefore not apply to these employees.

 

 

8. CONCLUSION

In the case of new employment contracts concluded after the amendment to the Labour Code comes into force, it is advisable to reflect this new legislation. In the case of existing employment contracts, it is again appropriate to assess whether the existing employment contract already contains a separate contractual arrangement that should be preferred or whether the new statutory regulation can be relied upon. If you are interested in reflecting the above-mentioned changes in your employment relationships, we are fully available to assess your employment contracts or other contractual documentation and, of course, to make suggestions for changes to the contractual documentation to reflect the benefits of this amendment to the Labour Code.

 

If you have any questions or uncertainties, please do not hesitate to contact us, we are fully at your disposal.

 

 

 

 

Team Spoladore & Bystřický