Changes in labour law effective from 01.10.2023

The long-awaited amendment to the Labour Code will come into force on 01.10.2023. But what changes are we specifically expecting?

1) Agreements on the performance of work and work activities

The amendment to the Code introduces a relatively extensive regulation of employment relationships on a permanent or part-time basis. The changes concern several areas, discussed below.


As such, the agreement must always be in writing. The work performance agreement must specify the agreed work and the period for which the agreement is concluded. In addition, the agreement on the work activity must also contain the agreed scope of the working time.

Provision of remuneration from the agreement

Newly, employees on FTE or FTE will also be entitled to remuneration from the agreement. This is remuneration provided, for example, for work in a difficult working environment, compensatory time off or holiday pay, weekend pay, etc. The remuneration from the agreement will be treated as a wage for workers on FTEs and FTEs.

Employees will also have the right to take all sick leave and holiday entitlements.

Conversely, the employee is not entitled to compensation from the agreement for the duration of other important personal obstacles to work and obstacles to work for reasons of general interest. However, the entitlement may be determined by agreement or internal regulation.

Working time schedule 

Employers will now also be obliged to draw up a written working time schedule in advance, which they will have to make known to employees. Unless otherwise specified, the employee must be made aware of the schedule at least 3 days before the start of the shift or period for which the working time is scheduled.

Employers will also be obliged to record the time worked by employees on an agreement in the same way as they do for employees on an employment contract.

Transition to employment 

If an employee working under an agreement for a cumulative total of at least 180 days during the previous 12 months requests employment from the employer, the employer is obliged to respond in writing to the employee within a maximum of 1 month.

Cancellation of the Agreement


The agreement can only be cancelled in writing in three ways:

  • by agreement of the parties on the agreed date,
  • testimony
  • immediate cancellation

Notice may be given for any reason or for no reason at all. The notice period shall then be 15 days from the date on which the notice is delivered to the other party. In certain cases, the employer has up to one month from the date of service of the notice to request the employer to provide written reasons for the notice

This is the case, for example, where the employee feels that he or she has been dismissed because he or she has asserted his or her right to information, advance working time or the right to professional development.

Immediate termination can only occur in a situation where the employment relationship can be terminated immediately. This is possible on the part of the employer if the employee has been convicted of a deliberate criminal offence or if he or she has breached his or her employment obligations in a particularly serious manner. An employee may be immediately dismissed on the basis of a medical opinion that makes it impossible for him to perform his work due to a serious threat to his health, unless the employer has made it possible for him to perform other suitable work. The agreement may also be terminated immediately if the employer has not paid the employee the remuneration due to him.

Scope of work on FTE

The scope of work on a FTE may not exceed 300 hours per calendar year. Work performed by the employee for the employer on the basis of another agreement is included in this period. Holidays, interruptions of work due to obstacles to work, taking time off for overtime or work on public holidays, etc. are not counted.

Holiday entitlement 

With effect from 2024, agreement employees will also be entitled to holiday pay. However, as there is no fixed weekly working time from which the amount of leave can be calculated, the weekly working time for leave purposes is set at 20 hours per week. Consequently, no account is taken of the extent to which the work was actually performed. Employees shall be entitled to leave when 2 conditions are met. The conditions are the same as for employees in employment. It will be necessary that the agreement lasts for at least 4 weeks continuously in the relevant calendar year and that the employee works at least 4 times his/her notional weekly working time (set at 20 hours).

Information obligation 

The employer is now obliged to inform the employee in writing of certain facts if they were not specified in the agreement. They must do so within 7 days of starting work. If the nature of the information allows it, the employer may only refer to the relevant statutory provisions or internal regulations or collective agreement. This includes the following information regarding:

the name and registered office of the employer (PO) or the name, surname and address of the employer (FO)

  • a more detailed description of the agreed work and the place of work,
  • the amount of leave and the method of determining the length of leave,
  • the duration and conditions of the probationary period, if any,
  • the procedure to be followed by the employer and the employee when terminating a legal relationship based on a work performance agreement or a work activity agreement, and the length and duration of the notice period,
  • professional development, if provided by the employer,
  • the expected amount of working time per day or week, the method of distribution of working time, including the length of the compensatory period referred to in Section 76(3),
  • the extent of minimum continuous daily rest and continuous weekly rest and the provision of meal and rest breaks or reasonable rest and meal periods,
  • the remuneration from the agreement, the conditions for its provision, the due date and time of payment of the remuneration from the agreement and the place and manner of payment of the remuneration from the agreement,
  • collective agreements governing the terms and conditions of employment of employees and the designation of the parties to those collective agreements,
  • the social security body to which the employer pays social security contributions in connection with the employee’s employment relationship,

If any of the information changes, the employer must inform the employee in writing no later than the day the change takes effect. However, this does not apply to changes in legislation, collective agreements or internal regulations.

The employee can also be informed electronically, but in a way that the employee can save and print it. The employer will then retain proof of the transmission of the information.

Upon commencing work, the employee must be familiarised with the work rules, the legal and other regulations on occupational health and safety which he/she must observe in his/her work, the collective agreement and the internal regulations.

2) Contracts or agreements concluded electronically  If the employment contract, other agreement or any amendment thereto is concluded via an electronic communications network or service, the employer must send a copy of it to the employee’s electronic address which is not in the employer’s possession and which the employee has communicated in writing to the employer for this purpose.

The employee may withdraw from the contract/agreement concluded in this way only in writing from the moment of its conclusion, but at the latest within 7 days from the date of delivery of a copy of the contract/agreement to the employee’s electronic address. Withdrawal is only possible until the employee has begun performance.

3) Employment for an indefinite period If the duration of the employment relationship has not been agreed in writing in the contract, the employment relationship is concluded for an indefinite period. If the duration of the contract has been fixed in writing, it may not exceed 3 years and may be repeated or extended at most twice. However, if the same parties conclude a fixed-term contract and 3 years have elapsed since the end of the contract, this period shall not be counted in the recalculation of the duration of the employment relationship. However, if the nature of the work or serious operational reasons do not correspond to the establishment of an open-ended contract, the terms may be adjusted differently by agreement between the employer and the trade union.

4) Working hours As regards working time, the amendment introduces two important changes. These are the regulation of continuous daily rest and continuous weekly rest.

Uninterrupted daily rest  Basically, it is about guaranteeing the employee 11 hours of rest in 24 consecutive hours. The limit of 11 hours is set for an adult, while for minors it is set at a minimum of 12 hours. Previously, the rest period was measured in the interval between the end of one shift and the beginning of another, but this is changing with the amendment. The decisive time frame is now 24 hours.

However, even this statutory time limit is not absolute. There are cases in which the rest period can be shortened, but only in cases defined exhaustively by law. Rest cannot be reduced for minors, who are not allowed to exceed the 12-hour limit. An adult employee’s rest may be reduced to up to 8 hours in any consecutive 24-hour period. However, the subsequent rest period must be extended by the amount by which the previous rest period was reduced. The situations in which rest may be so reduced are as follows:

  • in continuous operations, uneven working hours and overtime
  • in agriculture
  • in the provision of services to the public (especially in public catering, cultural facilities, telecommunications and postal services, health care facilities, social services)
  • for urgent remedial work, where the purpose is to avert danger to the life or health of employees
  • in natural disasters and other similar emergencies.

Uninterrupted rest during the week  The anchoring of continuous rest in the week is intended to avoid an interpretation that circumvents the regulation of continuous daily rest. There have been situations in which the employer has scheduled working time so as to provide a sufficient period of rest, but there has been no obligation to actually provide such rest.

Employees are now entitled to at least 24 hours of uninterrupted rest per week. Together with the continuous daily rest, this amounts to 35 hours of rest for an adult. In the case of minors, the duration of uninterrupted rest must be at least 48 hours per week. It is essential that the length of rest is assessed within a week, so it is not possible to work more than one day during some weeks and thereby accumulate time off which the employee would take at a later date. The emphasis is on sufficient regular recovery and rest for employees. The law does not directly stipulate that the rest day must be a Sunday, as this cannot be required for operational reasons. Nevertheless, the law states that, where operations permit, continuous weekly rest should be set on the same day for all employees, preferably to include Sunday.

Even with continuous rest during the week, it is possible to reduce the rest period to a total of 24 hours instead of 35 hours. These are the same exceptions provided for in the case of continuous daily rest and, in addition, for technological processes that cannot be interrupted. However, the period by which the rest has been reduced may not be subsequently granted separately, but only with the following continuous weekly rest, so that within 2 weeks the employee has a continuous weekly rest of at least 70 hours. Agriculture has a separately regulated length of rest. The length of the continuous weekly rest period may be reduced by agreement, but only so that the employee is given at least 105 hours of rest in 3 weeks or at least 210 hours in 6 weeks for seasonal work.

The adjustment of continuous weekly rest is effective only from 01.01.2024.

5) Overtime work in the healthcare sector Overtime work must be exceptional, and even a personnel “underclass” cannot justify systematic violations of the Labour Code. The Labour Code thus introduces a new measure to prevent excessive overtime.

The concept of so-called additional agreed work is newly introduced, which may be performed by a doctor, dentist, pharmacist, and a health care worker of non-medical health professions working in a continuous work mode.

Healthcare employees will therefore be able to work a maximum of 8 hours of overtime in a period of 26 consecutive weeks (the collective agreement may set the period at 52 weeks). In addition, a written agreement on so-called additional agreed work would have to be concluded with the employee. This agreement cannot be concluded during the first 12 weeks of employment and cannot last longer than 52 consecutive weeks. Either party shall have the right to terminate this agreement immediately during the first 12 weeks of its effectiveness. The agreement may also be terminated without giving reasons, but must be given in writing to the other party. The notice period shall be 2 months unless otherwise agreed.

The employer must

  • inform the competent labour inspection authority of the introduction of additional overtime
  • keep a list of staff working additional overtime
  • keep a record for each employee indicating the start and end of additional overtime worked

Employee in the health sector

  • may refuse further overtime and shall not be subjected to any detriment!
  • Additional overtime must not exceed an average of 8 hours per week over the period referred to above

Employee of the ambulance service

  • Additional overtime must not exceed an average of 12 hours per week over the period referred to above

The employer must never force the employee to enter into the agreement and the employee must never be subjected to detriment if he or she does not enter into the agreement. Any wrongdoing would then be punished by the Labour Inspectorate.

6) Work remotely Telework is a concept newly introduced by the amendment. It is a term for the previously used term “home office“. Telework is not an automatic entitlement of the employee, so the employer does not have to grant all requests for telework. However, the situation is different in the case of pregnant women, employees caring for a child under the age of 9 or a person dependent on the help of another. If a person in this category applies for telework, the employer will have to give reasons in writing for any refusal.

Teleworking must be agreed in writing, either as a separate agreement or as part of an employment contract or agreement to perform work, etc. The agreement should include:

  • Designation of teleworking locations
  • Method of communication between employee and employer
  • Method of work allocation and control
  • Scope of work and conditions for the distribution of working time
  • Reimbursement of costs associated with teleworking
  • The period for which such work is contracted
  • + method of ensuring health and safety at work and their control (optional)

The telework agreement may be terminated by either party within 15 days without giving any reason. A different time limit may be agreed. However, it must be the same for both parties. Both parties must have the same notice conditions, neither party should be at an advantage. The impossibility of terminating the telework agreement can also be negotiated.

When working remotely, the employee may also adjust his/her working hours himself/herself, without being bound by the working time schedule applicable to the normal performance of the job. However, the length of his shift may not exceed 12 hours, and the daily and weekly uninterrupted rest periods will also apply to teleworking.

Under certain conditions, the employer may also order teleworking, but only for the necessary period of time and must do so in writing. The conditions are as follows and must be met collectively:

  • so provides for action by a public authority under another law
  • the nature of the work performed allows teleworking
  • the telework location will be suitable for the work.

The introduction of the ability to command telework is a response to the recent global pandemic situation.

Reimbursement of costs  The employee has the right to compensation for the costs associated with the performance of telework. However, it may be agreed in a written agreement that the employee is not entitled to such compensation.

Reimbursements shall consist of reimbursement of the relevant costs demonstrated by the employee to the employer or a lump sum reimbursement amount due to the employee for each hour of teleworking. The amount of the lump sum will be announced by the MLSA and will be based on data provided by the Czech Statistical Office. Such an amount should cover all costs associated with teleworking (e.g. gas, electricity, water supply, etc.). If the employer is a so-called entrepreneurial employer, the lump sum provided may be higher than the statutory amount. 

Reimbursement of expenses may also be due to a salaried or temporary employee. However, this must be agreed in writing.

7) Parental leave, pregnancy, childcare The employer is obliged to grant parental leave to the extent that the employee requests it. Unless serious reasons prevent it, the written request must be made within 30 days before the start of the parental leave. However, parental leave may only be requested up to the age of three. Both the mother and the father of the child may apply. The mother is entitled to parental leave from the end of her maternity leave, while the father can apply for it from the birth of the child. Parental leave must be requested in writing.

The new regulation also comes with advantages for certain groups of people in terms of overtime work, teleworking or requests for shorter working hours.

Overtime work may not be ordered for pregnant women and employees caring for a child under 1 year of age.

If a pregnant employee, an employee caring for a child under the age of 15 or an employee caring for a person who is dependent on the assistance of another natural person requests shorter working hours or a suitable adjustment of working hours, the employer must comply with the request unless serious operational reasons prevent this. The request for shorter working hours must be made in writing, as must any justification for refusing the request on serious grounds. If the employer has granted the reduction in working time but refuses to restore the original scope of work, he must also give reasons in writing.

If a pregnant employee, an employee caring for a child under the age of 9, or an employee caring for a person dependent on the assistance of another natural person requests telework, the employer should grant the request. The request for teleworking must be in writing, as well as any reasons the employer gives for refusing the request.

8) Secondment of an employee

Duty to inform  Employers must now inform their employees more thoroughly if they post them in other countries. However, this obligation to inform only applies if the stays last more than 4 consecutive weeks. The information required varies depending on whether the employee is posted to another country or whether the work is in an EU Member State as part of a transnational service provision. Employers must always inform their employees in writing, well in advance. However, this information can also be agreed in the employment contract or agreement. Reference may also be made to the relevant legislation, collective agreement or internal regulation.

The information to be provided when posted to another country for the purpose of work concerns:

  • the country where the work is to be carried out,
  • the estimated time of this posting,
  • the currency in which the employee’s wages or salary will be paid,
  • a monetary or material benefit provided by the employer in connection with the performance of work,
  • whether and under what conditions the employee’s return is assured.

Information on work carried out in an EU country in the context of transnational provision of services concerns:

  • remuneration for work to which the staff member is entitled under the legislation of the host Member State,
  • the conditions for providing travel allowances in connection with the performance of work and other benefits provided by the employer in connection with the secondment,
  • a link to the official national Internet address set up by the host Member State

Secondment of an employee to a management/controlling body of a legal entity Prior to the amendment, employees could not receive remuneration from the relevant legal entity operating the business in connection with this membership. However, from 2024, the total aggregate remuneration paid to employees for all memberships in the management or supervisory bodies of legal persons carrying on business activities for a calendar year, including profit sharing or other monetary benefits, shall not exceed 25% of the annual aggregate of the highest salary scale and the maximum allowable personal allowance in the relevant grade and, in the case of a managerial employee, also the management allowance, the maximum allowable, according to the post last occupied by the staff member in the calendar year in question. The employee shall then be obliged to inform the employer without delay of any cash payment made to him.

9) Delivery The amendment also regulates the delivery of documents, whether by the employer to the employee or vice versa. In particular, it simplifies electronic delivery and delivery to a data box for important unilateral documents.

If the employer delivers to the employee, the employer may choose between several methods of hand delivery:

  • by handing it over at the employer’s workplace,
  • by handover wherever the employee is found,
  • via data box
  • via an electronic communications network or service
  • via the postal service provider

Documents may be delivered to the data box unless the employee has made it unavailable for delivery of documents from the data box of a natural person, an entrepreneurial natural person or a legal entity.  If the employee does not log in to the data box within 10 days from the date of delivery of the document to the data box, the document shall be deemed to have been delivered on the last day of that period.

Prior consent of the employee in a separate written statement is required for delivery via an electronic communications network or service. In that declaration, the employee shall also indicate the private address to which the documents are to be served. Such consent may be withdrawn in writing at any time. Before giving consent, the employer shall inform the employee in advance of the conditions and time limits for this method of service. Once the employee has received the document, he shall acknowledge receipt of the document to the employer within 15 days. If he fails to do so, the document shall be deemed to have been delivered on the 15th day.

The employee shall generally deliver documents to the employer by personal delivery at the employer’s registered office. The employee may request written confirmation of delivery.

The signed document may also be delivered to the employer via an electronic communications network or service at the address provided by the employer for that purpose. The document is then served on the date on which the employer acknowledges delivery by data message. If he has not done so within 15 days, the date of service shall be deemed to be the 15th day. If the document is returned to the employee as undeliverable, the service shall be ineffective.

In the case of service by data mailbox, the regulation is the same as for service by the employer.

10) Taxes The former Methodological Instruction D-22 on the Income Tax Act has been replaced by a new Methodological Instruction D-59, which clarifies certain provisions of the Act.

Tax residency Two groups of persons are tax residents, namely:

  • taxpayers having their domicile in the Czech Republic (the place where the taxpayer’s permanent home is located in circumstances from which it can be inferred that the taxpayer intends to reside permanently in that home)
  • taxpayers who habitually reside in the Czech Republic – i.e. stay in the Czech Republic for at least 183 days in the relevant calendar year, either continuously or in several periods

The bottom line is that if a person falls into either of these two categories, they are considered tax resident. Both criteria are equally important and neither takes precedence over the other. The period for which the taxpayer is resident is then judged against that criterion.

A tax resident is subsequently obliged to pay taxes both on income derived from sources within the Czech Republic and on income derived from sources abroad (a non-tax resident is obliged to pay taxes only on income derived from sources within the Czech Republic).

Notification of exempt income (from the sale of household goods) When selling an article of household goods, the seller has the option of exempting the income from tax. However, the following conditions must be met. The seller would have to have resided in the unit for at least 2 years prior to the sale of the unit, and the funds from the disposal of the unit would have to be used in whole or at least in part to acquire a new housing unit of their own. If he or she used only part of the proceeds from the sale of the original unit to purchase a new unit, only that portion of the consideration would be exempt from tax.

In order to be exempt from tax, it is necessary to notify the tax authorities of the acquisition of these funds by the end of the deadline for filing the tax return for the tax year in which the acquisition took place. The same deadline applies if the taxpayer is not obliged to file a personal income tax return (the deadline is the same as for a taxpayer who is obliged to file a return).

However, the exemption only applies to the sale of a unit that does not include non-residential space other than a garage, basement or storage room.

Notification of exempt income of natural persons  If the taxpayer receives tax-exempt income in excess of CZK 5 million, the tax exemption must be declared. The amount of 5 million is assessed separately for each individual income. Single income is income received at one time from one entity under one title.

Even for a taxpayer who is not required to file an income tax return, the deadline for reporting exempt income applies as if he or she were required to file a return.

Mortgage With regard to mortgages, the instruction clarified the conditions for entitlement to tax relief.

Tax relief is not available on part of the interest on a loan from a bank or building society granted for purposes other than those defined by law as “housing need”. Housing need is, for example, the payment of rent arrears, the purchase of housing equipment, etc.

If a participant in a credit agreement has a credit for the maintenance and alteration of the construction of a family house, and is not the owner of the house himself, he must prove his entitlement to tax relief at least by his relationship to the housing need. In the case of an owner, the relationship is evidenced by the title deed, but this cannot be done in the case of a person other than the owner. By housing need it is meant that he or she is the occupier of the house in question, i.e. uses it for permanent residence.

There are 2 limits for the application of the mortgage limits according to the time criterion:

  1. for interest on housing loans acquired before 1 January 2021 (‘old loans’)
  2. for interest on housing loans taken out from 1 January 2021 (‘new loans’)

For old loans, there is a limit of CZK 300,000 for the application of interest on loans, by which the tax base is reduced for all loans of taxpayers in the same joint household.

For new loans, a half-limit of CZK 150,000 applies for the application of interest on loans, by which the tax base is reduced for all loans of taxpayers in the same jointly-managed household.

In the case of a combination of old and new loans, the maximum limit for the application of interest is defined as CZK 300,000, while new loans can be counted towards the maximum limit up to a maximum of CZK 150,000 in total, even if the interest is divided among all participants in the loan agreement.

Short-term accommodation  The guidance also addresses short-term accommodation. Short-term accommodation means the rental of immovable property of a short-term nature, which is provided for the purpose of recreation and which is combined with other services (such as cleaning, changing of bed linen, etc.). Accommodation offered in a way that is indicative of targeting persons who are not seeking to satisfy a housing need but a need for temporary accommodation may also be considered as short-term accommodation.

Income from such accommodation is treated as self-employment income.

Meal vouchers and meal vouchers  The provision of meals as a non-monetary benefit by the employer for consumption at the workplace or as part of meals provided through other entities is tax-exempt income for employees. There is no limit on the exemption. Meal vouchers are also included among the non-cash benefits. Meal vouchers can be provided for a single meal or in multiples (lower values) and can also be provided retrospectively, based on shifts worked.

However, the meal allowance is a cash benefit. The income is exempt on the employee’s side up to a limit of 70% of the upper limit of the meal allowance that can be granted to salaried employees for a working trip of 5 to 12 hours per shift. This exemption is the same for shifts longer than 11 hours.  The shift must be at least 3 hours.

If the employee works on a fixed-term or part-time basis and does not have agreed shifts, the meal voucher is treated as tax-free. If the employee works two jobs and both jobs have set shifts, the lump sum is treated separately. The meal allowance can also be granted to managing directors of limited companies and exempt councillors if they have fixed shifts.

Each staff member may only take one form of catering per shift. However, the forms may vary from one staff member to another.

Corporate donations   A legal entity may deduct the value of a gratuitous supply from the tax base if its value was at least CZK 2,000. Subsequently, no more than 10% of the reduced tax base may be deducted in aggregate. If the 10% reduction of the tax base is less than CZK 2,000, only an amount representing 10% of the tax base will be deducted if the minimum value of the gratuitous transaction of CZK 2,000 is met.

When assessing the minimum value, the method of donation must be taken into account.

The difference occurs, for example, if a legal entity donates an amount of CZK 200 every month for one year. Since these are 12 separate donations, and the value of each of them has not reached the minimum value of the donation (CZK 2,000), these transactions cannot be deducted from the tax base. The fact that the total value of the donation (CZK 2 400) exceeded the minimum legal value of the donation is not determinative.

However, the situation will be different if the legal entity undertakes to make a donation of CZK 2,400, to be repaid in 12 individual monthly instalments. Although the performance is provided in instalments, it is a single gift whose value exceeds the minimum legal value of the gift. Such a benefit can be deducted from the tax base.

Start of construction on the land  The Guideline clarified that the time limit of 4 years from the acquisition of the land to commence construction of the housing need is not the time of conclusion of the loan agreement but the time of acquisition of the land.

Concurrent multiple employee income with one taxpayer (employer) If an employee who works on both a FTE and a DPP has made a tax declaration, all of his income will be included in one basis for calculating the tax advance, regardless of the amount of income derived from the FTE

However, if an employee working on a fixed-term employment contract and on another employment contract or on a temporary employment contract has not made a tax declaration and has an income from the fixed-term employment contract of less than CZK 10,000 per calendar month and from another employment contract of more than CZK 4,000, then the taxpayer will withhold tax at a special tax rate.

In the case of a DPP employee with an income of more than CZK 10,000 per calendar month, all income received from one taxpayer will be included in one tax base for the calculation of the advance payment.

 Income and expenditure of co-owners  The income jointly earned by the taxpayers by virtue of joint ownership and the joint expenses incurred to earn it shall be apportioned between the taxpayers according to their joint ownership shares. Where income from the use of a thing held in joint ownership by virtue of a contract accrues only to certain joint owners or otherwise than in accordance with their joint ownership shares, such income and expenditure shall be apportioned in accordance with that contract. Expenditure shall thereafter be apportioned in the same proportion as income.

If income and expenses are not apportioned according to co-ownership shares, depreciation and a provision for the repair of tangible property from which the co-owners derive taxable income may also be claimed as a tax expense. 

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