Labour relations in the Czech Republic

Labour relations in the Czech Republic are mainly regulated by the Labour Code (Act No. 262/2006 Coll., as amended). This Act covers a wide range of employment-related issues, including rights and obligations of employees and employers, labour protection, conditions of remuneration, working hours and holidays.

Basic aspects of labour relations:

Special forms of employment contracts:
Part-time employment: Czech labour law allows employers and employees to agree on working hours shorter than the standard weekly working time, which is generally 40 hours. Part-time employment is not limited to 20 hours per week. Employees working under regular part-time employment contracts are generally entitled to the same statutory employment protections as full-time employees, including protection against unlawful dismissal, applicable notice periods and statutory severance pay. The 20-hour average weekly limit generally applies to agreements on working activity (dohoda o pracovní činnosti, DPČ), which are a separate form of employment arrangement.

Czech labour law recognises two principal types of agreements for work performed outside a standard employment relationship: agreements to complete a job (dohoda o provedení práce, DPP) and agreements on working activity (dohoda o pracovní činnosti, DPČ). A DPP generally permits a maximum of 300 working hours per calendar year for the same employer, while a DPČ permits work not exceeding, on average, half of the statutory weekly working time. Both agreements must be concluded in writing. Employees working under these arrangements are entitled to statutory protections, including minimum remuneration, working time safeguards and paid annual leave where the applicable eligibility conditions are satisfied. Since 1 January 2024, qualifying DPP and DPČ workers have been entitled to paid annual leave under the Czech Labour Code.

Legal regulation of foreign workers:

Foreign nationals working in the Czech Republic on the basis of employment contracts concluded with Czech companies are subject to Czech law, including the Labour Code.

If a foreign employee works in the Czech Republic on a temporary assignment, he or she is subject to the mandatory rules of local law, even if the contract is concluded in accordance with foreign law.

Dismissal and severance pay:

An employee may be dismissed only for legitimate reasons provided for in the Labour Code, such as reorganisation, liquidation of the workplace, serious breaches of discipline or inability to perform the job.

Under the Czech Labour Code, the standard notice period is at least two months. However, following the amendment effective from 1 June 2025, the statutory notice period is reduced to at least one month for certain employer-initiated terminations involving failure to meet statutory or employment requirements or breaches of employment obligations under Section 52(f)–(h). The notice period generally begins on the date the written notice is delivered to the other party, unless a valid written agreement provides otherwise. Different rules may apply to notices delivered before 1 June 2025.

In the event of dismissal, an employee may be entitled to severance pay, the amount of which depends on the reason for dismissal and the length of employment with the company.

Thus, the Czech Labour Code provides a high degree of protection of employees’ rights and regulates in detail the relationship between employers and employees, including terms and conditions of remuneration, social benefits and protection in case of dismissal.

Work permits and residence permits in the Czech Republic

In the Czech Republic, work permits and residence permits are regulated by several laws, and the application process may vary depending on citizenship, length of stay and nature of employment.

Principles of free movement

Citizens of EU Member States, the European Economic Area (EEA) and Switzerland generally have the right to work in the Czech Republic without obtaining a work permit or employee card. However, applicable residence registration and administrative obligations must still be observed. EU and EEA citizens intending to stay in the Czech Republic for more than 30 days are generally required to report their residence to the Foreign Police within the prescribed period, unless an exemption applies. Family members who are third-country nationals may benefit from EU free movement rights but can be subject to additional residence documentation requirements.

Third-country nationals

Third-country nationals who do not have free access to the Czech labour market generally require appropriate authorisation to work and reside in the Czech Republic. Depending on their circumstances and the nature of employment, this may involve an Employee Card, an EU Blue Card, a work permit combined with a residence authorisation, or another applicable residence status. Certain categories of foreign nationals have free access to the Czech labour market under national legislation and do not require separate work authorisation. The applicable requirements depend on nationality, residence status, professional qualifications and the intended employment.

Worksheet

An Employee Card (zaměstnanecká karta) is a long-term residence permit that generally allows eligible third-country nationals to reside and work in the Czech Republic for more than three months. For employees without free access to the labour market, it combines residence and work authorisation for a specified employment position. An Employee Card is generally issued for the duration of the employment relationship, up to a maximum of two years, and may be renewed if the statutory conditions are satisfied.

Employee Card holders who do not have free access to the labour market must notify the Ministry of the Interior before changing employers or employment positions and may begin the new employment only after receiving confirmation that the statutory requirements have been fulfilled. Since October 2025, the applicable period for reporting new employment following the termination of previous employment has generally been extended to 90 days. Different notification rules apply to Employee Card holders who have free access to the labour market.

Submission process and deadlines

The Employee Card application process generally requires an eligible job vacancy to be registered in the relevant Central Database of Vacancies maintained by the Czech Labour Office, unless a statutory exception applies. Since 1 July 2024, the previously applicable mandatory labour market test has been abolished for vacancies intended for Employee Card and EU Blue Card holders. As a result, eligible vacancies may be included in the relevant central register without the previous mandatory 30-day waiting period. Employers must still comply with vacancy reporting requirements, and applicants must satisfy the applicable employment, residence and immigration conditions.

The statutory processing period for an Employee Card application is generally 60 days, extending to 90 days in particularly complex cases or where the Ministry of the Interior requests a binding opinion from the Labour Office. These periods may be suspended where the applicant is required to provide additional documents or remedy deficiencies. The overall application timeline also depends on consular appointment availability, submission of documents, biometric procedures and other administrative requirements. Since the mandatory labour market test was abolished in July 2024, applicants are no longer generally required to complete a separate 30-day labour market testing period before applying.

Termination and redundancy

For companies with more than 500 employees, employees may appoint one-third of the members of the supervisory board in joint stock companies (JSCs). This right does not exist in smaller joint stock companies and limited liability companies (LLCs).

In all companies, employees have the right to participate in counselling sessions on issues:

Employer Economic Development.
Structural changes and measures affecting employment (e.g. mass redundancies).
Working conditions and their changes.

If the company has a trade union, the employer must consult with the union before dismissing an employee, especially in the case of disciplinary dismissal.

Peculiarities of obtaining permits for third-country nationals

The procedure for obtaining a work card may require considerable administrative effort, including preparation of documents and liaising with Czech authorities.

Dismissal of an employee in the Czech Republic

In the Czech Republic, the dismissal of an employee is governed by the Labour Code and other regulations that provide a certain degree of protection for employees. The main provisions relating to dismissal include strict grounds for termination of employment, minimum notice periods and severance pay requirements.

Grounds for dismissal

An employer may only terminate an employee for the following reasons:

• Closure of a business or part of a business.
• Relocation of the company (or part of it).
• Organisational change (e.g. reorganisation, change in technology, downsizing to improve efficiency).
• Inability to perform labour duties due to health reasons (occupational disease or industrial injury).
• Failure to meet the requirements of the job, or failure to comply with established statutory or internal employer requirements.
• Violation of labour discipline (gross or repeated less gross violation).
• Breach of duty during illness (e.g. breach of hospital conditions).

Dismissal procedure

• Notice period: Since 1 June 2025, the notice period generally begins on the date the written termination notice is delivered to the other party, rather than on the first day of the following calendar month. The standard statutory notice period is at least two months, while a minimum one-month period applies to certain dismissals under Section 52(f)–(h) of the Czech Labour Code. The parties may agree in writing on different notice period arrangements within the limits permitted by law. Transitional rules apply to notices delivered before 1 June 2025.
• Dismissal without notice: Under Section 55 of the Czech Labour Code, an employer may terminate employment with immediate effect only in exceptional circumstances expressly permitted by law. These include particularly serious breaches of employment obligations or certain final criminal convictions involving imprisonment. Not every instance of misconduct justifies immediate dismissal. The employer must assess the seriousness of the conduct, comply with the applicable statutory deadlines and provide written notice specifying the legally recognised grounds for termination. Immediate dismissal is prohibited for certain protected employees, including pregnant employees and employees on maternity, paternity or parental leave.

Severance Pay

Depending on the reason for dismissal, employees may be entitled to severance pay:

• In cases of termination for organisational reasons under Section 52(a)–(c) of the Czech Labour Code, including redundancy, closure or relocation of the employer, employees are generally entitled to statutory severance pay based on their length of employment. The minimum severance amounts are:

  One month’s average earnings if employment lasted less than one year.

  Two months’ average earnings if employment lasted at least one year but less than two years.

  Three months’ average earnings if employment lasted at least two years.

  Higher severance payments may be established by collective agreements, internal regulations or individual employment arrangements.

• Since 1 June 2025, employees whose employment is terminated because they have permanently lost the medical fitness required to perform their existing work due to an occupational injury, occupational disease or risk of such a disease are generally entitled to a statutory one-off compensation payment equal to 12 times their average monthly earnings, in accordance with Section 271ca of the Czech Labour Code. This payment replaced the previous statutory severance entitlement for these specific circumstances and is generally covered by the employer’s statutory liability insurance. The entitlement does not automatically apply to every termination resulting from a medical condition.

Protective periods

The Czech Labour Code provides special protection against dismissal during specified protective periods, including temporary incapacity for work, pregnancy, maternity leave and parental leave. Under Section 53, employers are generally prohibited from giving notice of termination during these periods. However, the protection is not absolute, and Section 54 establishes exceptions for certain statutory termination grounds and circumstances. The validity of a dismissal during a protective period depends on the reason for termination, the employee’s status and the applicable legal exceptions.

Mass layoffs

Mass dismissals are regulated by both national laws and the EU Collective Dismissals Directive (98/59/EC). The definition of mass dismissal depends on the size of the company:

In companies with 20-100 employees, a mass layoff of 10 or more employees is considered a mass layoff.

In companies with 101-300 employees, a mass layoff of 10 per cent of the workforce is a mass layoff.

For employers with more than 300 employees, the termination of at least 30 employment relationships within a period of 30 calendar days for organisational reasons under Section 52(a)–(c) of the Czech Labour Code generally constitutes collective dismissal. Where at least five employees are dismissed by notice for these reasons, employment relationships terminated by mutual agreement for the same organisational reasons within the relevant period must also be included when calculating the statutory thresholds.

Procedural requirements for mass redundancies

The employer must inform the employees’ representatives (trade union or employees’ council) and hold consultations at least 30 days before notifying the employees. If there is no representative, the employees must be consulted directly.

In cases of collective dismissal, the employer must comply with the notification and consultation requirements established by Sections 62 and 63 of the Czech Labour Code. The employer must inform the relevant regional branch of the Czech Labour Office in writing about the planned collective dismissal at least 30 days before issuing termination notices to the affected employees. Following the consultation process, the employer must also submit a written report concerning the collective dismissal decision and the results of consultations. As a general rule, the employment relationships of affected employees cannot terminate earlier than 30 days after the Labour Office receives this final report, unless a statutory exception applies or an employee waives the corresponding extension.

It should be noted that neither employee representatives nor public authorities can block a dismissal, but they must be informed and can offer advice.

The dismissal procedure in the Czech Republic is strictly regulated and aims to protect the interests of employees by providing them with guarantees of a fair and transparent process.