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Employment Law Review 2013/2014: Czech Republic


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Employment Law Review 2013/2014: Czech Republic

  1. 1. Employment Law Review 2013/2014: Czech Republic Publication Date: 21 February 2014 Author(s): Nataša Randlová, Lucie Hořejší Member Firm(s): Randl Partners Country: Czech Republic Unlike 2012, when the employment law relationships in the Czech Republic were severely affected by the great Labour Code Amendment, the year 2013 was not so turbulent. In spite of this, employers had to cope with new regulations concerning Occupational Health Care and, primarily, prepare for the changes imposed by the New Civil Code (the “NCC”) and the Business Corporations Act (the “BCA”), which represent a complete recodification of Czech private law effective January 1, 2014. I. Various Changes Made in 2013 Occupational Health Care As of April 1, 2013, all employers were required to comply with the provisions of Act No. 373/2011 Coll., on Specific Healthcare Services, as amended, in ensuring occupational healthcare for their employees (formerly “occupational preventative healthcare”). Now, each employer must have a written contract signed with its provider addressing the provision of employment-related medical services. The provider must be either a physician or medical facility authorised to provide services in the area of general practice medicine or employment medicine. According to the new regulation, employment-related medical services include not only preventative examinations assessing the employee’s health capacity to carry out the job duties assigned to the given position, but also assessment of the effect of the work and working conditions on the employee’s health. Employment-related medical services also include advice concerning health protection at work, as well as work injury and occupational disease prevention. At least once a year (and in the case of Work Category 1, once every two years) the provider/physician must supervise the workplaces and the work, and train the employees in giving First Aid. The employer is further obliged to send all employees and applicants for work to be examined by the physician (entrance, periodical, extraordinary, exit or follow-up medical examination), except applicants for the performance of non-risk work – classified as Non-risk Category 1 or 2. Each time the employee must
  2. 2. 2 undergo a basic check-up comprising of a health and work anamnesis, a complex physical examination and a basic chemical analysis of urine (the examination is expected to last 30-60 minutes, depending on the category and type of examination). The physician may send the employee to further specialist check-ups if required by the legal regulations or if the physician considers it necessary. As soon as the provider has all the documents needed, he or she is obliged to issue a medical statement and hand it over to the employer. If the conclusion is that the employee is incapable of work, capable with a condition or has lost some long-term health capability, the employer must act in accordance with the statement immediately from the day on which it is received. If, according to the medical statement, the employee is capable of performing the job, the employer may start assigning work to him/her only after the period needed for filing a review application has lapsed. Because the employer is obliged to ensure employment-related medical services for its employees, it must bear the costs of the medical examinations, with the exception of the entrance examination in the case of unsuccessful applicants (the law requires the employer to pay entrance examinations for accepted applicants). The law does permit the employer to come to a different arrangement with the applicant (for example, that the employer will never pay the cost of entrance examinations). In this regard, however, employers must always pay for the entrance examinations of job applicants for the positions of night-shift employees, as well as minors. Fixed-term employment Since the great Labour Code Amendment in 2012 eliminated practically all exceptions in the case of fixed-term employment, a new amendment to the Labour Code (passed at the end of May 2013) has reintroduced some exceptions as of August 1, 2013, in the case of serious operational reasons on the employer´s side and/or reasons consisting in a specific nature of the employee’s work. Under the provisions of the amendment, employers with a trade union may stipulate details concerning the application of the exception in a written agreement with the trade union. Employers with no trade union may introduce the exception and set out its rules with an internal regulation. The agreement/internal regulation must include: • details of serious operational reasons/reasons consisting in a specific nature of the employee’s work – such reasons must be of a nature proving that the employer cannot be justifiably asked to propose an
  3. 3. 3 employment contract for an indefinite period; • rules for a different procedure of the employer in negotiating and repeating fixed-term employment, which must be adequate to the reasons stated; • period of time for which the contract is concluded/the regulation is issued; • scope of the employer’s employees to whom the different procedure will apply. In the case of the application of the exception, provided the agreed/stated conditions have been met, the employer will be able to conclude a fixed- term employment for a period longer than three years, or for more than three time periods. Shortening of the Uninterrupted Rest Period between Two Shifts The same Labour Code amendment that provides for more exceptions to be introduced in the case of fixed-term employment simultaneously shortens the period of uninterrupted rest between two shifts from 12 to 11 hours, with the exception of employees under 18 years of age, where the minimum 12-hour uninterrupted rest period between shifts is maintained. Salary compensation during temporary incapacity As of January 1, 2014, compensation for salary paid to an employee who is temporarily unable to work returns from 21 to the original period of 14 calendar days. The change from 14 to 21 calendar days was implemented by the Labour Code for the period of January 1, 2012 to December 31, 2013, within the saving measures of the Ministry of Labour and Social Affairs. Additional overtime work in health services The opt-out allowing the heath service professions to agree with the employer to additional overtime work (amounting up to 12 hours per week) was limited until the end of the year 2013. Therefore, as of January 1, 2014, no additional overtime work can be performed by employees in health services. Additionally, all previously concluded agreements in this regard terminated automatically. II. Recodification of Czech private law Along with the changes brought by the NCC and the BCA, other acts and subordinate legislation required amendment in this respect. In some cases, only a rewording was needed to ensure the language in different
  4. 4. 4 regulations was consistent. However, in other cases, important amendments had to be made. Labour Code Amendment Although the employment law has maintained its general independence from civil law, the newly effective principles do influence it, mainly in the following areas: • Invalidity and/or nullity of legal acts – new rules are set out for the relative and absolute invalidity of legal acts and, in addition, the concept of nullity is newly introduced in labour legislation and replaces the previous concept of invalidity in many places; • Pre-contractual liability – new sanctions are introduced in the form of damages penalising the dishonest actions of one of the parties within the process of concluding a labour law contract (i.e., employment contracts, agreements to perform work/to complete a job, agreements on the termination of the employment relationship, etc.); • Adhesive / form contracts – when concluding an adhesive contract, protection of a weaker party (i.e. principally the employee) is emphasised; in practice, it consists primarily of the employer´s duty to provide information about various clauses included in the employment contract, as well as a duty to explain their content in a manner the weaker party can understand; • Concluding a contract - an absolute conformity between the proposer and the acceptor concerning a particular offer to conclude an agreement is no longer required if an amendment to such offer (as made by the acceptor) is of a minor significance; • Course of the lapse period – the NCC introduces a completely new regulation of the lapse period by setting up various impediments which either suspend the course of the lapse period, or postpone it; as a result of the later removal of the impediment, the period starts running again, however, it cannot expire earlier than after six months from the date when it started running again – accordingly, this leads to a significant extension of the lapse periods; • Agreements on salary deductions – new rules are introduced, e.g. the maximum amount which can be deducted from salary is newly set to half of the salary, provided that this amount does not exceed the maximum limit stipulated by the Civil Procedure Code; • Inclusion – new legal regulation is introduced, including conditions for valid inclusion in the employment law relationships and its limits (which are the same as for the agreements for salary deductions); • Established practice of parties – an employer’s long-term practice may now result in legal consequences, i.e. voluntary and regular annual
  5. 5. 5 bonuses provided to the employees can create an entitlement to such bonuses, unless employees are informed that such practice does not stand for any established practice at the employer; • Compensation for work injuries – the issue of compensation for injuries has been split into two different regimes of its calculation: (i) compensation for work injuries, and (ii) compensation for other injuries, which could result in eventual problems with unequal conditions; • Internal regulations of the employer – the NCC expressly prohibits the employer from unilaterally imposing on employees any obligations above the law – i.e. most often in the work code; • Use of certain securing institutes in employment relationships are newly regulated, alternatively completely excluded; • The possibility of the statutory representative to immediately cancel an employment relationship in the case of a minor under 16 years of age, provided that all the conditions set out by law have been met and the court has given its consent. III. Changes Envisaged to be Implemented in 2014 Employment Act The Employment Act Amendment now under the commenting procedure in the Parliament concerns the following areas: • fulfilment of the obligatory portion/number of disabled persons employed – stricter rules for the alternative fulfilment through the providers of services or products are to be applied; • sending foreigners on business trips – it should be made possible for employers to send Blue and Green Card holders (only Type A – qualified workers with university education and key staff) to carry out work away from their workplace; however, this provision will serve as a confirmation that other foreigners may not be sent out on business trips; • reduction of the administrative load concerning employers’ obligation to have copies of documents proving the existence of the employment relationship between the employee and the employer at the workplace; the employer will only have to notify the District Social Security Administration of the day on which the employee commenced to work for it – after this obligation has been met, the existence of the employment relationship in the case of an inspection will be proved by the control body concerned through the Integrated Informational System of Labour and Social Affairs. Act on Residence of the Foreign Nationals in the Czech Republic
  6. 6. 6 According to Directive 2011/98/EU of the European Parliament and of the Council, on a single application procedure for a single permit for third- country nationals to reside and work in the territory of a Member State and on a common set of rights for third-country workers legally residing in a Member State (the “Directive”), a new national regulation of this matter should have been passed as of December 25, 2013. Unfortunately, a complete newly prepared regulation regarding the residence of foreign nationals dissolved during the political crisis in the Czech government in 2013; therefore, an amendment to the current regulation was prepared in respect of implementation of the Directive. This amendment, however, was not passed before the deadline. The amendment is now under a commenting procedure in the Parliament and concerns mainly the issue of a single permit allowing a third-country national to reside legally in its territory for the purpose of work, in particular in the form of so-called employment cards. Recently, the new Czech government has wanted to return to the idea of a complete recodification of the Czech regulation of foreign nationals. In this respect, we expect the government to start the legislative procedure all over again in 2014, yet, on the basis of the previously agreed principles in the regulation as prepared by the former government. Labour Code Also, rather technical changes to the Labour Code are expected to be implemented in 2014 in connection to the 2013 recodification amendment. Several mistakes have already been found in this respect which had not been taken into account when preparing the accompanying legislation to the NCC. Originally posted on the Ius Laboris Knowledge Base: About Ius Laboris Ius Laboris is an alliance of law firms offering employers cross-border employment and pensions law advice. It has 1,300 specialist HR lawyers in over 150 cities and 44 countries. Ius Laboris offers access to the best local HR law experts in one global team with 20% more ranked employment lawyers (Chambers & Partners, November 2013) than any other global HR legal services organisation. Further, Ius Laboris has 50% more recommended lawyers than its nearest rival in a recent survey in PLC's employment law guide. Clients include many household names as well as multinational companies in all sectors ranging from energy, retail
  7. 7. 7 and technology to pharmaceuticals. For more information on Ius Laboris, please visit