Leave Laws and Holidays in the Czech Republic: A Guide for US Companies
Interested in expanding your US company to the Czech Republic? Read our guide to learn about Czech leave laws and policies, in preparation for hiring team members there.
Caitlin MacDougall
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Read Story →The Czech Republic, also known as Czechia, has a rich and diverse history. With German and Slav territories bordering the country, Czechoslovakian culture is a mix of German and Slavic, although much of its art and architecture reflects its Italian influences. The country is full of historic castles, winter spas and resorts, stunning street art, and busy cafes. During the summer, cities like Prague are practically teeming with tourists who are eager to experience the natural and architectural beauty.If you are looking to broaden your remote team to Europe, the Czech Republic has much to offer. One of the most popular industries in the Czech Republic is tourism, which enabled the service sector to generate more than half of the country's GDP. Research and development; information and communication technologies; software development; consultancy; and finance are some of the mainstays in the service industry, and about 60% of Czech employees work within these professions.To hire in the Czech Republic, you will need to adhere to local labor laws, which include leave entitlements and holidays. We will walk you through an overview of these laws, as well as worker classifications that will help you determine which workers are most ideal for expanding your business to the Czech Republic.
Employee agreements 📑
An employee relationship is established with a written contract. The contract should include the day the employee will start working, their duties, and where the work will take place. The employee agreement may also specify the set weekly working hours that the employee is required to work, their benefits, their wages or their salary, and whether there is to be a probationary period in which the employer determines the employee's suitability for the position. Currently, the Czech Republic's monthly national minimum wage is CZK16,200, or 747.31 USD, a 1,000 CZK increase since 2021.The Czech employer must provide a copy of the employee's contract. If the employer fails to provide a written contract with a copy for the employee, then the employee can challenge the terms of the contract and render it invalid, so long as the contract is challenged before their first day of work. If the employee doesn't challenge the terms of their employment, the employer can still be fined by the Labour Inspection Authority when they terminate the contract.It should be assumed that the contract is indefinite unless the employer establishes a fixed term in the employment agreement. If this is the case, the term may last a maximum of three years and may be renewed twice at most from the date that the employment relationship started.Other types of employment agreements 📄
The other types of employment agreements outside of an employment contract is an agreement to complete a job and an agreement to perform work. These types of contracts can be used for part-time or temporary jobs. Many employers find these types of employment relationships more convenient, especially if it is unclear how long a project will take or how much work they can provide. Another benefit to hiring part-time or temporary contractors is that these employees are responsible for handling their own personal income tax and required payroll contributions, paid to social security. The employer does not have to provide benefits to the employee, such as sick pay. Furthermore, the employer can end the employment relationship at any time without a notice period or severance pay.Agreement to complete a job
In an agreement to complete a job (known in the Czech Republic as DPP), the employee can work a maximum of 300 hours a year for the same employer. If the employee's monthly gross income is more than CZK10,000, they must make social security contributions.Agreement to perform work
With an agreement to perform work (known commonly as DPČ), the employee's social security contributions are the same as they would be under a full-time employment agreement. The maximum working hours the employee may work for the same employer is 20 hours a week.Agency workers
In some cases, an employment agency will hire agency workers to work for another employer (known as a user) through a specific written agreement in the employment contract. Before the agency worker starts work, the user and the the employment agency must ensure in the written agreement that the working conditions are equal to that of the user's permanent employees.Weekly working hours and rest periods ⏰
The weekly working time for full-time employees in the Czech Republic is 40 hours. Employers cannot require more than eight hours of overtime work in one week, and the overtime work performed must not exceed 150 hours a year. Scheduling an employee for more than 12 hours a day is also against labor law in the Czech Republic, and employers must give employees 12 hours of rest between each work day. Lunch breaks are 30 minutes, and employees must receive a break after six hours of work.For overtime work, the employee must receive 25% of the employee’s average hourly wages in addition to their normal wages. In lieu of overtime pay, the employer can provide compensatory time off to the employee for overtime hours, with the employee's consent.Paid leave 😎
There are different types of paid leave in the Czech Republic for full-time employees in the non-governmental sector. It is not mandatory for part-time employees or self-employed workers to receive paid leave.Public holidays 🎊
Full-time employees receive time off for public holidays. There are 13 public holidays in the Czech Republic within a calendar year:- New Year's Day (Restoration Day of the Independent Czech State), Jan 1
- Good Friday (movable)
- Easter Monday (moveable)
- Labor Day, May 1
- Liberation Day, May 8
- Day of Slavonic Apostles Cyril and Methodius, July 5
- Anniversary of the Martyrdom of Jan Hus, July 6
- Day of Czech Statehood, September 28
- Day of Founding the Independent Czechoslovak State, October 28
- Day of the Struggle for Freedom and Democracy, November 17
- Christmas Eve, December 24
- Christmas, December 25-26
Annual leave 📆
The minimum holiday entitlement for an employee in the Czech Republic is four weeks annually. Depending on the profession, employees may be afforded more holiday entitlement: public employees are entitled to five weeks' holiday, for example. Teachers and academic employees are allowed eight weeks of holiday leave.If a full-time employee has not worked for an employer for the entire calendar year, they are still entitled to leave. The paid leave is calculated so that they receive 1/52 of their annual leave for each full week of work.Employers should provide a written holiday schedule for their employees that adheres to any trade union regulations. The employee must use all of their holiday entitlement, preferably en bloc by the end of the calendar year. Some holidays may be carried forward into the following year with an employee's written request.Sick leave 🤒
As long as an employee provides a medical certificate from a doctor stating that they are ill, they are entitled to time off for an illness or a temporary disability. Under the Sickness Insurance Act, the employer is required to provide compensation for the first 14 days of sick leave, after which sickness insurance covers the employee's wages.After 14 days of sick leave, the sick allowance is calculated from a percentage of the employee's daily assessment base. The daily assessment base is the employee's average earnings that they received over the past 12 months. Here is how the employee's earnings are calculated:- the employee receives 60% of the daily assessment base for the first 30 days of temporary incapacity for work or an ordered quarantine
- the employee receives 66% of the reduced daily assessment base from the 31st to the 60th day of temporary incapacity or ordered quarantine
- the employee receives 72% of the reduced daily assessment base from the 61st day of temporary incapacity or ordered quarantine
Military leave 🎖
Employees may take leave for compulsory civilian service, such as military services, substitute military service, military exercise, or any appointments or appearances before a military administration. They are also allowed leave for a temporary assignment, in which case the employer must provide paid time off for the first two weeks of the employee's absence.Family members of military personnel are also entitled to special allowances while their family member in the military is engaged in compulsory military service.Parental leave 🤰
Parents in the Czech Republic are entitled to paid maternity leave and paternity leave, although it is only recently that the government extended paternity leave benefits to 14 days.Mothers are entitled to 28 weeks of maternity leave, or 37 weeks in the case of multiple births. During this period, they receive 70% of their daily assessment base. An employee is entitled to these benefits if they have completed 270 days of sickness insurance participation during the last two years before their maternity leave starts.In the case of adoption, a female employee is entitled to the same compensation scheme as a birth mother, and 22 weeks of maternity leave after adopting the child. If the mother adopts two or more children, she is entitled to 31 weeks of leave, or until the child reaches one year of age, whichever comes first.In addition to the mother's income, the Labor Office in the Czech Republic pays CZK220,000 in parental benefits, no matter the employee's income, and parents may receive this benefit until the child reaches four years of age.If an employee is caring for a child younger than ten years of age, or if they are caring for a sick family member, the employer has to excuse all absences related to that care. Employees can receive nine days of care leave, or 16 days if they are the sole caregiver for a child or sick family member. Social security pays for this benefit. The employee may also request shorter working hours, which the employer must allow unless there are operational reasons that prohibit them from complying with the request.Compliance and labor laws ⚖️
If your company is looking to hire in other countries, it will be important to stay compliant with legal regulations and employment law. Local labor laws will vary, not to mention requirements for paid leave and holiday entitlement. Although the Czech Republic is part of the EU, the regulations are, of course, not necessarily the same as they are in Ireland, Spain, or France, for example.Employment contract laws can be complex, and without the proper expertise, your company might overlook important details, like those involving worker classification, which could lead to fines or legal trouble. Tax laws, as well as collective agreements, are also details that a company can't afford to ignore.For many companies, the most prudent option for offsetting the risk of noncompliance is to hire HR experts.
Legal Disclaimer:
The information contained in this site is provided for informational purposes only, and should not be construed as legal advice on any subject matter.
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