CZECH LABOUR CODE - important amendment - summary

Following several years of preparations, the Parliament of the Czech Republic has approved an extensive amendment to Act No 262/2006, the Labour Code, as amended. The amendment was assigned No 285/2020 and will come into effect in two phases: on 30 July 2020 and 1 January 2021.


We have summarised for you all the important details. 


Effective from 30 July 2020:

1.  Delivery of documents


The changes concern the delivery of important documents, which must be delivered to the employee in person. The existing conditions were very difficult to meet in practice if personal delivery failed, which first of all the employer has to provably attempt. 


Now the employer needs to attempt personal delivery only at workplace, and if this is not possible, then there are other equally valid means of delivery. In addition to personal delivery and delivery via a postal services provider or an electronic communications network/service, there is also a new option of delivery to a data mailbox, however the employee must expressly agree to this.


In relation to delivery via a postal services provider, the storage period is changed to 15 calendar days (from the former 10 working days), leading to unification with the postage conditions of Czech Post, the largest postal services provider in the Czech Republic. The postman’s obligation to make a written record of the provision of information about the consequences of refusing to accept the correspondence has also been canceled. Correspondence is sent to the last address which the employee announced in written to the employer (formerly this was the last address known to the employer).


The main obstacles that often disabled legally effective delivery of documents to employees have been eliminated; these especially complicated cases concerning the delivery of documents towards the termination of employment.


The new regulation also concerns the delivery of documents from the employee to the employer. The fiction of delivery has been introduced for situations when the employer impedes delivery of documents, e.g. by refusing to accept it. Delivery to the employer’s data mailbox will also be possible with its consent.


2.  Transfer of rights and obligations from labour law relationships


The legislation is based on Council Directive 2001/23/EC on the approximation of the laws of the Member States relating to the safeguarding of employees' rights in the event of transfers of undertakings, businesses or parts of undertakings or businesses. The existing Czech transposition in the Labour Code, including national judicial decisions, is however overly broad and affects the majority of cases of in/outsourcing or simple changes of supplier. The aim of the amendment was therefore further specification and correction and also to be in accordance with the decisions of the CJEU. 


The following conditions must be now cumulatively fulfilled for transfer of rights and obligations from labour law relationships to happen where an activity or part thereof is being transferred:


-       the activity after transfer is performed in the same or similar manner and scope,

-       the activity does not consist entirely or largely in the delivery of goods,

-       immediately before transfer, there exists a group of employees deliberately created by the employer for the purpose of the exclusive or mainly performance of the activities,

-       the activity is not intended as short-term or should not consist in a one-off task, and

-       an asset or the right to use it is transferred if this asset is essential for the performance of the activity given the character of the activity, or if the majority of the employees the current employer used to perform the activity are taken over, if this activity largely relies only on the employees and not the asset.


These conditions will not apply in the case of a transfer pursuant to a different law, where the fiction of the transfer of the employer’s activity is directly determined (e.g. in case of a merger or purchase of an enterprise).


Furthermore, an employee’s right to give notice to their employer in connection with the transfer of rights and obligations from labour law relationships has been amended as concerns the deadlines by which such a notice may be given and the determination of the time the employment relationship will end in this manner. Now the law also distinguishes whether the employee was informed of the transfer in due time or not.


3.  Recalling from working position of managerial employee


The amendment reacts to the judicial extensive interpretation of the scope of possibilities to arrange the recalling of an employee from a management position. In the past, the Supreme Court of the Czech Republic concluded that the possibility of recalling may be contractually agreed with any managerial employee. Legislator reacted to this and expressly defined which management positions within an employer’s hierarchy are subject to the possibility of recalling of such employees.


4.  Periods


The existing subsidiary use of the Civil Code to suspend / extend periods proved to be highly unsuitable for labour law relationships. For this reason, the amendment adds special provision for labour law relationships.


The suspension of a period due to obstacles will not affect the original length of the period; only once the obstacle ceased and there are remaining less than 5 days until expiry of the period, the period may not finish sooner than in 10 days after it recommenced.

5.  Cross-border posting of employees in the framework of international provision of services 

The supplementation in the Labour Code transposes Directive (EU) 2018/957 of the European Parliament and of the Council, amending Directive 96/71/EC concerning the posting of workers in the framework of the provision of services. The range of comparable conditions which must be ensured for the employees in the territory of the Czech Republic is extended. Furthermore, a new provision has been added which concerns cases of long-term posting exceeding 12 months; in addition to enshrining additional protection for these employees, this situation is also connected with an obligation to submit an announcement justifying such extension to the regional branch of the Czech Labour Authority.


The transposition of the directive also applies to so-called double posting, when an agency employee is posted. In such a case, the employer / user is obliged to inform the employment agency sufficiently in advance that it is intended to post any temporarily posted employee to perform work as part of the international provision of services in the territory of another EU member state.

6.  Confirmation of employment


An employer’s obligation to issue confirmation of employment to an employee in the event of termination of an agreement on performance of work is maintained only in cases when this agreement established the employee’s participation in sickness insurance or where there was performed execution of a decision through wage deductions.


Effective from 1 January 2021:

1.  Vacation

The issue of vacation is presented as the main conceptual change of the entire amendment. The unit for calculating vacation will now be hours, although vacations are still expected to be taken in terms of days or weeks. The change should bring about a fairer scope of vacation for employees with unevenly scheduled working hours, changing shift lengths, and those working part of the calendar year or with shorter working hours.


The length of vacation will be determined so that for every weekly workload (in hours) to which the employee committed and actually worked, they are entitled to 1/52 of their vacation for the calendar year. The determining unit for calculation was previously the shift / working day, whereas now it will be hours.


A reduction of vacation will newly be permitted only for unexcused absence, whereas the number of hours of vacation can be reduced by no more than the corresponding number of hours of unexcused absence; compared to current legislation, this is an easing in favour of the employee.


As concerns obstacles to work, there is a new definition of which obstacles are counted as the performance of work, to what maximum scope they may be counted, and what the minimum period of work performed is for their inclusion to be possible.

2.  Shared job


A shared job is defined as a job shared by two or more employees with shorter working hours and the same type of work, with whom the employer has concluded the relevant agreement. These employees schedule their own working hours by mutual agreement. The Labour Code stipulates only framework rules for such scheduling of working hours, and also regulates the possibility of terminating the obligation from such shared job agreement. 


This is an entirely new institute in the Czech labour law, but one that was already practiced by many entities in a similar form; it means, inter alia, that the introduction of a legal framework might complicate this internally developed practice.

3.  Compensation for accidents at work and occupational diseases


One-off compensation for an other-than-proprietary loss in the case of particularly severe harm to an employee’s health has been added to the types of compensation, as has the range of persons for whom the right to this compensation arises.

Furthermore, instead of fixed amounts for the one-off compensation of survivors (the range of beneficiaries is also extended) and for compensation of reasonable costs for the funeral, a mechanism has been introduced for increasing these amounts, linked to a certain multiple of the wage in the national economy determined for the stipulated period.

4.  Time off for events with children and youth


Subject to compliance with the conditions as stipulated by law, an employer is obliged to provide an employee with paid time off (at most one paid week per calendar year) to perform activities at camps for children and youth. In addition to camps, this type of time off is extended to include similar activities at sports training camps for children and youth. If the employers prove fulfilment of the conditions, they will be entitled to request compensation for these costs from the District Social Security Administration Office.


The above presents only the main, selected changes arising from the amendment to the Labour Code. In addition to reacting to practical needs, national judicial decisions and EU regulations, the amendment also contains many legislative-technical and terminological specifications of the wording of the law.


Contact for further information:


Andrea Krásná, Partner