Amendment to the Labour Code: Agreements for Work Performed outside Employment Relationship

Work Schedule

The amendment imposes an obligation on employers to schedule the working hours of employees who perform work under the agreement to perform work and the agreement to complete a job in advance. This schedule must be provided to the employee in writing and needs to be communicated to the employee at least 3 days prior to the start of the shift or period for which the working hours are scheduled. The employer and employee can agree on a shorter or longer notification period for the work schedule.

Vacation

Another significant change concerns vacation entitlement of workers under the agreements, provided they meet the specified conditions. The general regulations regarding vacation in the Labor Code will apply to the conditions of entitlement,
calculation, and utilization of vacation. For the purpose of vacation, a fictitious weekly working time of 20 hours is newly established for workers under the agreements. However, only those employees who have an uninterrupted employment relationship with the employer for at least 4 weeks and who have worked at least four times the established fictitious
weekly working time, i.e., at least 80 hours, will be entitled to vacation.

Extra pay and obstructions to work

Employees working under agreements will now be entitled to additional pay or compensatory time off for work on public holidays, night work, work in a difficult working environment, and work on weekends. While the original version of the
amendment anticipated applying the regulations on work hindrances to workers under the agreements to the same extent as for employees in regular employment, the amendment now specifies that the employee will be entitled only to working time off, but not compensation from the agreement in case of important personal obstacles in work or obstacles in work from the public interest, unless otherwise stipulated in internal regulations.

Transition to Employment Relationship

The amendment also introduces the possibility for employees who have worked for an employer on one of the agreements for at least 180 days within the previous 12 months to request in writing a transition to regular employment. The employer is then obliged to provide a written response with justification within one month, without being obligated to grant the request.

Written Justification for Agreement Termination

Agreements can still be terminated with a fifteenday notice period without stating a reason or for any reason. However, in certain cases, the employee can request a written justification for the termination, and the employer will be obliged to comply. If the employer fails to fulfil this obligation, a fine of up to CZK 200,000 may be imposed, based on the proposed amendment to the Labor Inspection Act.

Expanded Information Obligation

Another new obligation for employers will be to provide expanded information to employees about their rights and obligations arising from the employment relationship within 7 days from its inception, or about changes in the content of the
employment relationship no later than the effective date of these changes. Employees should now be informed about the duration and conditions of the probationary period, if provided, professional development opportunities, the extent of minimum continuous daily/weekly rest periods, as well as the social security institution to which the employer pays social security contributions.

The amendment to the Labour Code will take effect on October 1, 2023, except for the provisions regarding the entitlement to vacation., which will take effect on January 1, 2024.

In light of the aforementioned changes, employers are recommended to adjust both their agreements and their approach towards employees working under agreements in accordance with the proposed amendment to avoid potential sanctions from labour inspections.

Authors:
Anna Klímová, Editor, Mazars Tax View
Gabriela Ivanco, Tax Manager