The Czech Republic is a prosperous country of 10.6 million people, located in Central Europe between Germany, Poland, Slovakia, and Austria. It has one the highest GDP growth rates and lowest unemployment rates in the European Union, in spite of a relatively high dependence on exports resulting in susceptibility to volatility in demand. Czech Republic’s GDP was $215.73 billion in 2017, mostly from automobiles exports making up almost 80% of the total.
The country’s cultural groups include Czech (64.3%), Moravian (5%), and Slovak (1.4%) with Roman Catholicism as the primary religion. The Czech people enjoy socializing in neighborhood pubs, drinking their world famous Czech beer, connecting with family and friends. January 1st, 1993 is celebrated as the day of the founding of the Czech Republic, as separate from the former country of Czechoslovakia.
Permanent employment is defined to last for an indefinite period (open-end employment relationship). An employment relationship lasts for an indefinite period unless a fixed term of its duration has been expressly agreed upon.
An employment relationship is established by an employment contract between an employer and an employee. Such contracts must be made in writing. A written employment agreement must contain the following information:
The employee's full name, employer's designation and seat if the employer is a legal entity, or the employer's full name and address if the employer is a natural person
Information on job title and place of performance of work
Information on the duration of annual leave or the method of determining it
Information on notice periods
Weekly working hours and schedule
Information on salary and the remuneration method, the maturity of wage or salary, paydays and the place and method of payment
Information on collective agreements regulating the employee's working conditions and the designation of the contracting parties to these agreements
Temporary employment refers to employees of an employment agency, temporarily assigned to an employer who hired the agency. Such employees must have a Blue Card, or a work permit, and may not be disabled. A temporary employment agreement must be concluded in writing.
The temporary assignment must terminate on expiry of the period agreed in the agreement. The employment agency must not temporarily assign the same employee for performance of work to the same user for a period longer than 12 consecutive calendar months unless it is requested by the agency employee.
The maximum probationary period cannot be longer than 4 months for regular employees and 8 months for managers. In the case of fixed-term employment contracts, the probationary period must not be longer than half of the agreed period of the employment relationship.
Probationary period is extended by the employee's working days in which they did not work the entire shift during the probationary period due to an obstacle to work, taking leave or unexcused absence from work.
Employers are not required to include the probationary period in employment agreements; however, it must be agreed to in writing, at the latest, on the day the work commences.
During the probationary period, both the employer and the employee can terminate the employment relationship for any reason or without stating any reason. However, during the probationary period, the employer may not terminate the employment relationship within the first 14 calendar days of an employee's temporary incapacity for work or quarantine.
The standard workweek is 40 hours. The length of a shift may not exceed 12 hours. After continuous work for 6 hours at the utmost, employees are entitled to a work break for a meal and rest lasting at least 30 minutes; an adolescent employee must be given such a break after a maximum of 4.5 hours of continuous work. Employees are allowed to arrange their working hours in shifts under a written agreement with their employer.
Employers are required to draw up a written weekly work schedule and inform employees of the schedule or its alteration at the latest 2 weeks before the beginning of the period over which the working hours are distributed.
An employee who has performed work for the same employer for at least 60 days in one calendar year is entitled to leave for that calendar year, or a proportional amount of leave if employment did not last continuously for the entire calendar year.
The standard length of annual leave is 4 weeks. For government employees, annual leave is 5 weeks. Persons employed in education and academic employees of universities are entitled to 8 weeks of annual leave. Employees engaged in particularly arduous or hazardous work are entitled to supplementary leave.
The leave accumulates gradually during the year and any unused annual leave must be taken by the end of the following calendar year. If the leave cannot be used up by the end of the following calendar year because the employee has been declared temporarily unable to work or because of the use of maternity or parental leave, the employer is obliged to determine the period of taking this leave after the end of these obstacles at work. When leave is interrupted due to military service, maternity leave, or paternity leave, annual leave is suspended and can be resumed after the interruption stops.
Sick employees are entitled to paid sick leave under the sickness insurance, with graduated support depending on the length of time away. The premium for sickness insurance is 2.7%, and the minimum sickness insurance premium is set at CZK 243 in 2025. Employers pay 2.1% and employees pay 0.6%.
During the first 14 calendar days of illness, the employer is required to provide wage compensation equal to 60% of the employee's average wage. After the 15th day, employees are entitled to sickness benefits paid from the social security system. Wage compensation is due for working days in the event of temporary incapacity for work.
The social security sickness benefit per calendar day amounts to 60% of the reduced daily basis of assessment for the first 30 days of temporary incapacity for work or ordered quarantine, 66% of the reduced daily basis of assessment from the 31st day to the 60th day of temporary incapacity for work or ordered quarantine and 72% of the reduced daily basis of assessment from the 61st day of temporary incapacity for work or ordered quarantine.
In the Czech Republic, a female employee's maternity leave begins at the sixth week before the expected childbirth (the earliest it can start is at 8 weeks before the expected delivery).
An employee is entitled to 28 weeks of maternity leave. If she gave birth to 2 or more children at the same time, she is eligible for 37 weeks of maternity leave.
The Czech Health Insurance Fund funds maternity benefits. An employee must participate in insurance for at least 270 calendar days over the last 2 years before they take maternity leave to receive financial assistance from the fund.
Per the amendments to the Sickness Insurance Act in the Czech Republic, paternity leave is a sickness insurance benefit. Insured fathers are entitled to 14 days of paid leave in connection with the care of a newborn child. The benefit is paid by the Czech Sickness Insurance Fund.
An employer must also grant unpaid parental leave upon a request from an employee. The entitlement to parental leave applies to the mother of a child upon the termination of her maternity leave and the father of a child from the delivery date until the child turns 3 years old.
The Czech Labor Code states that the minimum notice for dismissal must be at least 2 months. The notice period is reduced to 1 month for the following types of dismissals:
Failure to meet job requirements
Serious breach of duty
Repeated minor breaches
Gross violation of employee obligations
It is the same for both employers and employees and can be extended or changed only by written agreement. Effective June 1, 2025, the notice period takes effect on the day on which the notice was delivered to the other party. Notice of termination with respect to an employment relationship must be in writing and state the reason for termination.
For fixed-term employment, the contract expires at the end of the agreed period. However, the employer is required to provide notice of the termination at least 3 days before the event. If the employee continues working after the agreed period, and the employer is aware of the employee's performance, the employment relationship becomes indefinite.
The Labor Code requires an employer to make redundancy severance payments if the employer either dismisses or terminates employees by agreement due to the following reasons:
If the employee becomes redundant due to the decision of the employer to change activities, increase efficiency, or restructure
If the employer's undertaking relocates or closes down
Depending on the duration of the employment relationship, the amount of severance pay can be up to 3 times the employee's average monthly earnings.
Effective June 1, 2025, where an employee's employment ends because they can no longer perform their job due to a work-related injury, an occupational disease or the threat of such a disease, or because they have reached the maximum permissible workplace exposure as determined by a decision of the competent public health protection authority, the employee is entitled to a one-time workplace compensation payment of at least 12 times their average earnings. This payment is no longer treated as severance and is now a one-time compensation, satisfied through the employer's statutory work-injury liability insurance.
