1 Historical background
The Czech Republic came into being on 1st January 1993, when the former Republic of Czechoslovakia peacefully split into two independent countries, the Czech Republic and the Republic of Slovakia. The former Republic of Czechoslovakia itself had been created in October 1918 in the aftermath of the disintegration of the Austrian Empire, after World War I. Czechoslovakia had a parliamentary democracy, accounted for a large share of the former Austro-Hungarian Empire industrial capacity, and had a performant economy. However, the first Republic of Czechoslovakia lasted only some twenty years as on March 1939 it was invaded by Hitler's Army. The country was then occupied by Nazi Germany until the end of World War II, in 1945. Once the war ended it had a short-lived democracy, which was interrupted by the coup d'état of February 25, 1948, when the Communist Party seized power and imposed a Soviet-like political and economic regime.
In the mid sixties, the Communist Party under its Secretary Alexander Dubcek launched a number of economic, political and cultural reforms, which attempted to create a "socialism with human face regime". Though these reforms, which peaked in the so-called "Prague Spring", in 1968, benefited from very wide popular support, they provoked the reaction of the Soviet Union, which led to the occupation of Czechoslovakia by the Treaty of Warsaw troops, in August 1968. Soviet occupation continued until the "Velvet Revolution" in November 1989, which brought the communist regime to an end. In January 1990 the country held a democratic election and Vaclav Havel, a former dissident, was elected President. Pursuant to the split of Czechoslovakia into the Czech Republic and the Republic of Slovakia, Havel was elected President of the former, in January 1993.
The Czech Republic has accepted all of the international obligations that were binding on the former Czechoslovakia, including the ILO Conventions ratified by the latter. It joined NATO in 1999, and the European Union on 1st May 2004.
The Constitution of the Czech Republic was adopted on 16 December 1992 (Act No. 1/1993 Coll. – amended by the acts No. 347/1997 Coll., No. 300/2000 Coll., No. 395/2001 Coll., No. 448/2001 Coll., and No.515/2002 Coll.). Article 3 of Chapter one, “Fundamental provisions”, incorporates in the Constitution the Charter of Fundamental Rights and Freedoms adopted on 16 December 1992 (No. 2/1993 Coll. – amended by the Act No. 162/1998 Coll.) as a component of constitutional order. The Charter of Fundamental Rights and Freedoms, includes, among other important labour rights, in its title four, guarantees to citizens' economic, social and cultural rights, for example, the right to freely chosen occupation, the right to obtain means for covering one's needs by work, the right of employees to equitable remuneration for work and satisfactory working conditions, the right of women, young persons and persons with disabilities to increased safety and health at work, including adapted working conditions and assistance in training for an occupation, the right to freely associate with others with a view of protecting economic and social interests, the right to strike, etc.
The Czech Republic is a sovereign, unitary, democratic and law-abiding State based on the respect of the rights and freedoms of human beings and citizens.
Article 10 of the Czech Constitution provides that “promulgated international agreements, the ratification of which has been approved by the Parliament and which are binding on the Czech Republic, shall constitute a part of the legal order; should an international agreement make provision contrary to a law, the international agreement shall be applied.”
The legislative power in the Czech Republic is vested in the Parliament, which is made up of two chambers, namely the Chamber of Deputies (Poslanecká snemovna) and the Senate. The chambers are elected for a term of four years (Deputies) or six years (Senators) - one third of the Senators shall be elected every two years. There are currently 200 Deputies and 81 Senators. Elections to the Parliament are held by secret ballot on the basis of universal, equal and direct suffrage and under the principles of proportional representation (Deputies) or under the principles of the majority system (Senators). In order to gain representation in the Chamber of Deputies, a political party must win at least 5% of the national vote.
Any bill must be adopted by the Chamber of Deputies to become a law, while the participation of the Senate varies according to its decision or to the issue covered. Bills shall be introduced in the Chamber of Deputies by any of the following: a deputy, a group of deputies, the Senate, the Government, or the representative body of a superior self-governing territorial unit. The Government may ask the Chamber of Deputies to complete its consideration of a Government Bill within three months of its introduction, provided that the Government ties thereto its request for a vote of confidence.
A Bill passed by the Chamber of Deputies is referred to the Senate who then considers it. In its decision the Senate passes or defeats the Bill or returns it to the Chamber of Deputies with amendments, or expresses its resolve not to consider it. If the Senate defeats a Bill, the Chamber of Deputies takes a second vote thereon.
An approval of both Chambers of Parliament is required to ratify international agreements.
The President of the Czech Republic may return an enacted law, with the exception of Constitutional Acts, together with the grounds for the return. The Chamber of Deputies must take a new vote on the returned law. No amendments may be introduced. If the Chamber of Deputies upholds the returned law by majority vote of all Deputies, the law is promulgated. If not, the law is considered defeated. Laws, which have been enacted, are signed by the Chairperson of the Chamber of Deputies, the President of the Republic and the Prime Minister. For a law to be valid, it must be promulgated in the Collection of Laws of the Czech Republic. The law shall stipulate the way a law or an international agreement is promulgated.
The head of the State is the President elected at a joint meeting of both chambers of the Parliament for a term of five years. The President appoints and recalls the Prime Minister and other members of the Government and accepts their resignation, recalls the Government and accepts its resignation, convenes sessions of the Chamber of Deputies, dissolves the Chamber of Deputies, appoints Justices of the Constitutional Court, appoints from among the Justices of the Supreme Court the Chief Justice and Assistant Chief Justices of the Supreme Court, has the right to return to the Parliament an enacted law with the exception of Constitutional Acts, signs enacted laws, represents the State with respect to other countries, negotiates and ratifies international treaties (he may delegate the negotiation of international treaties to the Government or, with its consent , to its individual members), is the supreme commander of the armed forces, receives, appoints and recalls the heads of diplomatic missions, calls elections to the Chamber of Deputies and the Senate, appoints and promotes generals, appoints judges, has the right to grant amnesty etc.
The Executive power is vested in the Government of the Czech Republic, composed of the Prime Minister, Deputy Prime Ministers and Ministers. The President of the Republic appoints the Prime Minister. On the Prime Minister's proposal, he or she appoints the other members of the Government and entrusts them with the direction of individual ministries or other agencies. The Government is accountable to the Chamber of Deputies. The Government may ask the Chamber of Deputies for a vote of confidence and the Chamber of Deputies may express no confidence in the Government. The motion is admitted when approved by the majority of all Deputies. The Government shall resign if the Chamber of Deputies rejects its request for a vote of confidence or if it votes against confidence in the Government.
The judicial power is exercised by independent courts. The courts provide protection of rights in a manner defined by law. The court system is made of the Supreme Court, the Supreme Administrative Court and superior, regional and district courts. The jurisdiction and the organization of courts are defined by Act No. 6/2002 Coll. on courts and judges, as amended. All parties to judicial proceedings have equal rights. Proceedings before a court are oral and public. Exceptions are defined by law. Verdicts shall always be pronounced in public.
The Supreme Court is the supreme judicial body of the Czech Republic. The President of the Republic appoints the judges for life. The judges make their decisions as single judges, except when the law specifies that they shall decide in bench. In his or her decision-making a judge is bound by the law and international agreements constituting part of the legal order; he or she is entitled to assess the conformity of a different legal regulation with the law or with such international agreement. The Supreme Court plays an important role in labour disputes, by unifying jurisdiction in this area and publishing it in a Collection of Court judgments and judicial opinions.
The Constitutional Court, established by Act No. 183/1993 Coll. on Constitutional Court, as amended, is a judicial body responsible for the protection of the constitutional rule. It consists of fifteen Justices appointed by the President of the Republic after confirmation by the Senate.
The Constitutional Court rules on the repeal of laws or other legal regulations or individual provisions, on constitutional complaints filed against illegal interventions by the State, or against final decisions violating constitutionally guaranteed fundamental rights and freedoms, etc.
A decision of the Constitutional Court whereby nonconformity of an international agreement with the constitutional order is pronounced prevents ratification of the agreement until such nonconformity is eliminated.
Accession to the European Union
The Czech Republic joined the European Union on 1st May 2004. Membership in the EU requires that the country complies with the "acquis communautaire" (already existing Community law), that it implements ("transposes") any Directives and Regulations not already incorporated into national law, that it transposes any future Directives into national law within the specified time period, and that it abides by future Regulations. European Community Law (EC Law) is binding not only on the State but it also has direct effects on individuals, who can invoke it before the national courts. In addition, national courts can and must submit cases before the European Court of Justice (ECJ) for a preliminary ruling under article 234 EC when they consider that national law or regulations deviate from EC law. In case the ECJ takes the view that a national law or regulation (including a collective agreement or even a practice) is in breach of EC Law, then it shall instruct the national court to set aside the national rule so that it can give a judgment in light of EC Law only.
EC Law is composed of primary law (the EC Treaty and the EU Treaty), and secondary law (Directives, Regulations, Decisions etc). While regulations are binding and applicable in all Member States without further national legislation directives are binding as to the result to be achieved, upon each Member State to which they are addressed, but shall leave to the national authorities the choice of form and methods (Art. 249 EC). In practice, Member States adopt legislation with a view to transposing a directive into the national law though in some cases a directive may be implemented by other means, and more especially by collective agreement, which is expressly envisaged under article 137.4 EC.
Labour law has a long history as part of private law. Private law on the territory of the present Czech Republic was codified in the 19th century. The General Civil Code (AGBG) from year 1811 regulated two types of contracts: the “service contract” and the “on work contract”. Later, public components were introduced in the originally private system of labour law. Collective agreements began to be concluded to supplement present protective labour regulation. The amendment of the General Civil Code adopted in 1916 (providing for a service contract), stipulated some mandatory provisions to enhance the level of labour protection. After the First World War new created Czechoslovakia adopted former labour regulations, reformed and improved them.
After 1948 the new communist regime transformed former law according to the socialist principles. The so-called “legal two-year plan” amended practically all parts of the law and there was an attempt to unify the labour law. Unification of the labour law was crowned by the adoption of the Labour Code (Act No.65/1965 Coll.), which came into effect on 1 January 1966. Since then, there have been around 40 amendments, but the basic framework has remained the same since the Communist era.
Sources of labour law in the Czech Republic in descendent order are constitutional acts, the most important of which is the Constitution of the Czech Republic, international treaties, in particular ILO Conventions and EC Law, acts and regulations to implement acts (Government decrees, ministerial notifications) published in the Collection of Laws of the Czech Republic, normative provisions of collective agreements and individual employment contracts. International treaties constitute a part of the legal order (above-mentioned article 10 of the Constitution): Among them are the International Covenant on Economic, Social and Cultural Rights and International Covenant on Civil and Political Rights that include rights and freedoms, which represent a basis for the legal status of citizens and trade unions in employment relationships.
According to the constitutional Charter of Fundamental Rights and Freedoms, obligations may be imposed only by law and within limits of law. Implementing regulations, such as Government decrees and ministerial notifications or regulations can be issued only to implement acts adopted by the Parliament and on the basis of specific authority provided by these acts. Case law is not, strictly speaking, considered to be direct source of law.
Labour relations are regulated, in particular, by written labour law (the Labour Code) and, within its framework, by collective agreements and individual employment contracts. The Labour Code (act No. 65/1965 Coll., as amended) was the first systematic set of labour regulations in the former Czechoslovakia with effect as from 1st January 1966. In spite of the fact that recent amendments were designed to respond to social and economic changes, in particular the ongoing privatization and a fundamental change in the employee status on the labour market, a number of the Code's provisions have remained unchanged and do not fully respond to the developments which have taken place in labour relations, new forms of employment, etc.
The Labour Code is based on the overriding principle: “What is not permitted by law is prohibited.” In fact, the implementation of this principle in practice does not allow two parties to agree on something that the Code does not address. But the Czech labour law is subject to a reform, aiming at liberalizing the conception of labour law norms. The new Labour Code should, in opposition with the previous principle, define the limits, and leave the rest to be agreed on in collective bargaining between employers and the Trade Unions. The Ministry of Labour and Social Affaires´ working group drafting the new Labour Code is, among others, working on the following fields: the incorporation of the principle that what is not prohibited is permitted; legislation on the minimal entitlements primarily ensuing from EU directives and ratified ILO Conventions and with regard to the protective function of labour law; the relation between the law, collective agreements and employment contracts; the issue of the exclusivity of collective agreements; the issue of the scope of trade union powers, arrangements for improving the functioning of the inspection systems and courts to enforce the application of labour legislation, etc. The new Labour Code should give employers and trade unions greater room to negotiate working conditions more appropriate to their needs. It is thus expected that the importance of collective agreements will be significantly increased.
Provisions of the Labour Code are generally applicable and cover all employment relations between employer and employee. Employment relations of certain groups of employees are subject to special legislation. This is the case of public servants in administrative authorities, judges, State prosecutors, members of armed forces, citizens performing public functions other than those based on employment relationship etc.
Regulations concerning collective labour relations in collective bargaining can be found in the Labour Code and other labour legislation as well as in regulations covering the process of conclusion of collective agreements, in particular in the Collective Bargaining Act No.2/1991 Coll., as subsequently amended. The existing standards do not define the contents of collective agreements. The decision in this regard is left to the parties of the agreement. Provisions that are more favourable for workers can be agreed only in cases where the Code has expressly provided for such arrangements. An exception to this rule are provisions concerning remuneration in accordance with Act 1/1992 Coll., on wages, remuneration for stand-by and average earnings, as amended (English summary), by which pay in the private sector has been completely liberalized.
Very important are regulations concerning the freedom of association, contained in Act No.83/1990 Coll. on association of citizens, as subsequently amended (Czech and English versions). Act No.120/1990 Coll. concerning certain relations between trade union organizations and employers, as amended, provides a guarantee for the trade union plurality.
To prepare the accession of the Czech Republic to the EU, new provisions were adopted by the amendment on the Labour Code in the year 2000 (Act No.155/2000 Coll.), which improved labour legislation, including the introduction of new legal instruments (for example concerning collective redundancies and protection of employees' claims in case of their employer's insolvency, the right to information and consultation, the terms of which are consistent with those contained in the relevant EC directives and in the European Social Charter, as well as certain other provisions concerning in particular working time and health and safety).
Contract of Employment
The employment relationship plays a dominant role in Czech labour relations, both in respect of frequency of occurrence and in respect of volume of work covered by it. Thus it represents the most frequently used form of labour relations in the Czech Republic. The employee protection provided by the Labour Code is based on international standards, by which the Czech Republic is bound, in particular the ILO Conventions, the UN Covenants on human rights and economic, social and cultural rights, the European social charter and EC legislation and case law.
An employment relationship is based on a contract between an employer and an employee. In accordance with section 29 of the Labour Code, a contract of employment must include certain prerequisites: the type of work to be performed by the employee, the place of work and the starting date. Although the Labour Code does not specify that the agreement should be in writing, the so-called Written particulars of employment Directive (Council Directive 91/533/EEC of 14 October 1991) requires employers to provide employees with a written statement of the terms and conditions of employment, Pursuant to this Directive, before concluding a contract of employment, the employer is to provide the employee with full information about the rights and obligations ensuing from the proposed contract, including working conditions and pay for the work to be performed.
Permanent and fixed-term contracts of employment
In addition to the essential conditions to be mentioned in the agreement, the parties to the contract of employment can agree on other terms and conditions. Both parties must agree on the whole content of the contract.
These additional conditions might concern, for example, the duration of employment relationship. In this respect, section 30 of the Labour Code provides that the contract of employment is concluded for an unlimited period, unless the duration of the contract is explicitly stipulated.
An amendment to the Labour Code (Act No. 46/2004 Coll.), effective since 1 March 2004, implements Directive 1999/70/EC on fixed-term work. The amendment restricts the repeated conclusion of fixed-term contracts between the same parties to a maximum period of two years. If the employer concludes an employment contract with an employee for a definite period of time in breach of prescribed conditions and the employee, before the agreed period elapses, informs the employer in writing that he or she requests to be employed further, the employment is deemed to have been concluded for an indefinite period of time. The Ministry of Social Affairs is working on yet another amendment of the Labour Code, which should also contain more provisions on the repetition of fixed-term contracts. The final version of this text could be expected by the end of 2004.
According to the Labour Code, the duration of the probationary period is 3 months (section 31 of the Labour Code). The two parties of the contract of employment can agree on a shorter probation period but the period of 3 months cannot be extended by agreement. The probation period can be agreed only by means of the contract of employment and, at the latest, on the day when the employment relationship is established.
A possibility to agree a competition clause is provided in section 29 (2) and (3) of the Labour Code. In accordance with these provisions an employee may accept the obligation that, for a certain period after termination of his or her employment, which however must not exceed one year, he or she will not be engaged in a business activity of competitive nature in respect of his or her former employer. Such activity must then be performed neither for another employer nor as self-employment. A non-competition clause can be agreed upon under circumstances where there is justification for such arrangement. The legislation admits arrangements whereby violation of such agreement would lead to a penalty to be paid by the employee concerned. Act No. 46/2004 Coll., amending the Labour Code and harmonizing Czech Labour Law with several EU directives, lays down stricter conditions for concluding agreements on competition clauses between employers and employees. As opposed to the regulation applicable before this amendment, the employer now has an obligation to provide the employee with an adequate pecuniary compensation at least in the amount of one month's average salary for each month covered by the competition clause. Due to these new regulations, the amendment suppresses the possibility to conclude a right to severance pay in the event that managers are removed from their management positions.
In accordance with EC legislation (directive 91/553/EEC on the employer's obligation to inform employees of the conditions applicable to the contract of employment relationship) alignment efforts led to an amendment of the Labour Code. The amended section 32 (3) to (6) imposes on the employer an obligation to provide his or her employee with information in writing concerning his or her basic rights and duties ensuing from the concluded employment relationship. Such information is supposed to cover only arrangements, which are not expressly provided for in the contract of employment.
Other types of employment contracts
Part Four of the Labour Code defines situations in which the performance of dependent work also can be based on labour relations other than that of employment relationship. These relations are established by agreements concerning work, performed in addition to the employment relationship. The main legal relationship on which performance of work is based is, of course, employment relationship for full working hours. This is the employee's main source of income, the source of support of his or her family. Therefore, it is covered by strong protection provided by many provisions of the Labour Code. Where the employee performs work in addition to his or her employment relationship, this is a ‘parallel' or a ‘subsidiary' employment relationship. Such employment relationship is of a complementary nature and, as a rule, constitutes a complementary source of income. For this reason the protection provided by the Labour Code is considerably weaker.
So-called work performance agreements are designed to enable employers to attain their business goals in cases where it does not seem to be practical to recruit employees for full-time unlimited contracts of employment. Such auxiliary labour relations provide more room of manoeuvre for both parties to the contract. To a substantial extent, the employer can free himself from many obligations that are related to employment relationships, in particular those concerning origin and termination of employment.
The Labour Code has provided for certain significant differences between employment relationships on the one hand and agreements to perform work under different types of contract on the other hand. In an employment relationship, one of the main employee's obligations is that he himself or she herself must perform the work agreed upon. In the event of other types of contract, work can be performed also with assistance of family members, where this is expressly agreed in writing. As distinct from what exists in an employment relationship, the relations of superiority and subordination are also weaker. Thus, an employee performing work based on a contract other than that of employment relationship can act in a relatively independent way and he or she is bound by the agreed result of his or her work. The contracts covering such work include rights and obligations agreed on by the parties to the contract and there are no binding legal provisions concerning the contract of employment, such as is the case with employment relationships. This establishes a weaker status of the employee concerned. He or she must enforce the stipulation of his or her rights concerning the agreed working activity by means of the contract.
Suspension (interruption) of the contract of employment
The essence of any contract of employment is a contractual obligation accepted by the employee to perform the agreed job and the corresponding employer's obligation to assign agreed work and pay agreed wages for the work performed. In accordance with section 35 of the Labour Code, the employer is required starting from the day of origin of employment relationship, to assign his or her employee work defined in the respective contract of employment and pay him or her wages. The employee's obligation is to personally perform agreed work in accordance with the employer's instructions. In the course of implementing these contractual arrangements there are frequent situations where an employee is unable to perform his or her duties due to certain circumstances impeding such performance.
In these cases there might be impediments to work both on the part of the employee and on the part of the employer. The respective provisions are contained in the Labour Code and in Government order 108/1994 Coll. implementing the Labour Code (English version), as amended. The most important implication is suspension of work performance. This is the case where the employee is relieved from his or her obligation to perform work, or where the employee does not perform work because his or her employer is temporarily relieved from his or her obligation to assign to him or her agreed type of work. In these circumstances the employee is not entitled to wages, because no work is performed, and the employer has no obligation to pay wages. However, legislation provides for circumstances, in which an employee may acquire a right to compensation of wages or entitlement to other consideration.
In the period of certain impediments to work employees cannot be dismissed (section 48 of the Labour Code). These are, in particular, periods of temporary incapacity for work due to sickness or accident, periods of employee's pregnancy, periods where a man- or woman-worker provides permanent care of a child of less than three years of age and periods where an employee takes her maternity leave.
Impediments on the part of an employee may generally be divided into impediments due to reasons of public interest (section 124 of the Labour Code) and serious personal impediments to work (sections 127 and 128 of the Labour Code). These two types of impediments are further regulated in more detail by the Labour Code and by implementing regulations. The legislation provides in which cases an employee is entitled to material security from his or her employer or from other bodies, and where the employer is only required to excuse his or her employee's absence from work. Of importance is also the employee's obligation to inform his or her employer about the existence of personal impediments to work, to ask for leave and to provide evidence of an impediment to work and of its duration.
As to impediments on the part of the employer, provisions are included in sections 129 and 130 of the Labour Code. They are referred to as down time, work stoppages for reasons of bad weather, and other impediments on the part of the employer. In these circumstances and in accordance with section 129 of the Labour Code, the employer has the right to assign his or her employee to other work, even in the absence of his or her agreement (section 37 (4) of the Labour Code). Where the employee is assigned to other work, for the performance of which wages are lower than for work agreed in the contract of employment, the employee concerned is entitled to a supplement of his or her earned income up to the amount of average earnings. Where the employer is unable to assign his or her employee to other work, the employee is entitled to compensation in the amount of 80 per cent of average earnings, or, in cases of bad weather conditions, to 60 per cent of average earnings. In both cases, the compensation can be higher where a relevant clause exists in the collective agreement or in internal regulations of the company concerned (the latter case concerns companies where no trade union organization operates). Compensation for lost wages may not exceed average earnings. These regulations apply both for employers in the entrepreneurial and non-entrepreneurial sphere (business sector and public and non-profit organizations).
Termination of the employment relationship
Grounds for termination
In accordance with the legislation, termination of employment is accomplished by the following legal acts:
- Agreement concerning severance of employment relationship;
- Notice of dismissal;
- Immediate cancellation;
- Cancellation during the probation period.
Agreement concerning severance of the employment relationship
An agreement concerning severance of the employment relationship is a bilateral act regulated by section 43 of the Labour Code. Participants in the contract of employment must concur that the employment relationship will terminate in this way and agree on the date of termination. The employment relationship will then cease to exist on the agreed date. Where the employee requires that grounds for termination of employment be stated, they must be expressly stated in the agreement, which should be made in writing. However, non-observance of this form does not make the agreement invalid.
Notice of dismissal
Notice at the employee's initiative is a one-sided legal act. An employee may serve notice stating any reasons or even without stating reasons. The Labour Code makes no restrictions for employees wishing to terminate their contracts of employment. The period of notice is two months.
On the other hand, the Labour Code contains a number of restrictions in respect of cases where the employment relationship is terminated at the employer's initiative. These restrictions are designed to protect employees against unfounded and arbitrary acts, to protect stability of employment relationship and to enhance the employee's legal and social security. An employer can serve notice of dismissal only for the reasons referred to in section 46 (1) a) to f) of the Labour Code. The reason for dismissal must be clearly stated. Another condition to be met is that the notice must always be made in writing and must be delivered to the employee's own hands, either in the work place or by post.
Grounds for termination stated in section 46 (1) of the Labour Code can be divided into two groups. On the one hand, there are the grounds related to the employer's situation, the so-called organizational grounds (section 46 (1) a) to c)). This is the case where the company or parts thereof cease to exist or are transferred elsewhere, or where organizational changes take place, for example the change of equipment. Another valid reason is the reduction of the number of employees in order to improve productivity.
In these cases the period of notice is 3 months and in connection with the termination of employment, the employee concerned is entitled to severance pay in accordance with section 60a of the Labour Code, i.e. the double of average monthly earnings. The provision concerning severance pay includes cases where the termination of employment is made by mutual agreement for the above reasons. Severance pay can be increased over and above the said amount by means of a collective agreement.
Other grounds for dismissal (section 46 (1) d) to f)) are directly concerned with the employee: his or her state of health prevents him or her from performing the agreed job, or the prerequisites for the performance of the job are not fulfilled. In case of non-satisfactory performance, the notice of dismissal can be served only if the employer has reprehended the employee concerned in writing in connection with his or her poor performance within the past six months. The last group of grounds concerns violation of work discipline on the part of the employee. In these cases the period of notice is 2 months and the employee concerned is not entitled to severance pay in connection with the termination of employment relationship.
An employer is not allowed to dismiss a worker during a protected period (section 48 of the Labour Code). This relates to certain situations of life where it is deemed to be socially irresponsible to allow for workers' dismissal. These are the following periods: periods of temporary incapacity for work, periods of compulsory service in armed forces, periods of unpaid leave in order to serve in public office, periods when an employee is pregnant or on maternity leave, periods where both female and male employees permanently care of a child of less than 3 years of age, and periods where an employee working on night shifts becomes temporarily unable to continue night work. A notice of dismissal under these circumstances would be invalid.
However, the prohibition of dismissal in these cases is not absolute and does not cover events where the company ceases to exist in whole or in part, or where activities are transferred to another place. In these cases there are objective grounds making it impossible for the employer to fulfil obligations ensuing from the contract of employment, and notice of dismissal is possible even in these circumstances. Other exceptions concerning prohibition of dismissal are regulated by section 49 of the Labour Code.
Immediate cancellation of the employment relationship
Both the employee and the employer can at any time agree upon the immediate cancellation of an employment relationship. Such an agreement must be made in writing and the ground for immediate cancellation must be such as not to be misinterpreted or subsequently replaced by another ground. The notice concerning cancellation must be handed to the other participant in the contract of employment otherwise the cancellation is not valid.
An employer may immediately cancel employment relationship only in exceptional situations as follows. Where his or her employee was validly sentenced for an intentional criminal act to an unconditional prison term of one year or more, or committed in connection with the performance of his or her job, or in direct connection therewith to an unconditional prison term of 6 month, or where the employee has committed an especially serious violation of work discipline. An employer may immediately cancel employment relationship only within a period of one month from the day when he or she learned about the grounds for immediate cancellation, and at the latest within one year of the day on which these grounds arose.
An employee may immediately cancel his or her contract of employment if, according to an opinion of a doctor he or she is unable to perform his or her job without serious threat to his or her health and his or her employer has not assigned him or her another suitable job within 15 days of the submission of the medical opinion. The same applies to situations where the employer has not paid the employee's wages, or compensation of wages. An employee may immediately cancel his or her contract only within a period of one month from the day when he or she learned about the grounds for immediate cancellation, and at the latest within one year of the day on which these grounds arose. Where these conditions are fulfilled, an employee who immediately cancelled his or her contract of employment has the right to claim wage compensation in the amount of his or her average earnings for the duration of the statutory period of notice.
Cancellation of the employment relationship during probation
The cancellation of an employment relationship during the probation period can be made either by the employer or the employee. It must be made in writing with stating grounds for it, or even without stating any grounds. Written communication should be delivered to the other party, as a rule three days before the day of intended termination of the contract of employment.
Section 52 of the Labour Code includes specific provisions regulating collective dismissals, in accordance with Directive 98/59/EC on Collective Redundancies. A collective dismissal is defined as the following number of terminations of employment relationships, on the basis of notice given in accordance with section 46 (1) a) to c), during a period of 30 days:
- 10 dismissed employees in companies employing 20 to 100 employees;
- at least 10% of the employees in companies employing 101 to 300 employees;
- at least 30 employees in companies employing more than 300 employees.
Where an employer contemplates collective redundancies, he or she is required to begin consultations with the competent trade union body or the employees' council at least 30 days before serving notices of dismissal. These consultations are designed to arriving at an agreement on measures to avoid or to reduce adverse consequences of collective dismissals and to mitigate their social impact. Above all, ways and means should be sought for transferring the employees concerned to other employers' workplaces and/or finding them new suitable employment. Before starting these consultations the employer is required to provide the trade union organization or the employees' council with all necessary information and data. There is an explicit obligation on the part of the employer to provide information to these bodies and to open negotiations with them.
Termination of a fixed-term contract
An employment relationship agreed on a fixed term expires at the end of the agreed period. Where the duration of employment is determined by performance of a specific task, the employer is required to call the attention of his or her employee to the date of termination of this task, as a rule at least three days before the termination. Where, after the expiry of the agreed period, the employee continues working without any objections on the part of the employer, such employment relationship is deemed to have changed to unlimited employment relationship, unless the two parties to the contract do not agree otherwise. Fixed-term contracts can also be terminated by other reasons referred to in section 42 of the Labour Code.
Remedies in case of unfair or illegal dismissal or cancellation of the employment relationship
If an employer serves an invalid notice of dismissal or proceeds with an unfounded immediate cancellation of employment relationship, and if the employee notifies the employer that he or she insists on continuation of employment, the employment relationship is deemed to continue. In this case the employer is obliged to pay compensation of wages. Such compensation is due in the amount of average earnings starting from the day when the employee notifies his or her employer, that he or she insists on continuation of employment, until the day when the employer has enabled him or her to continue the performance of his or her job or, alternately, the day when the employment relationship has been validly terminated. If the entire period during which an employee is entitled to compensatory wages exceeds six months, a court may, at the employer's request, reduce the period during which he or she is obliged to provide compensation of wages or may stop the provision of this compensation altogether. The court should take into consideration, in particular, whether the employee has started a new employment, assess the conditions of such new employment and the income earned, and/or reasons why the employee continues to be unemployed.
If the employer's reasons for termination of employment relationships are ill-founded, but the employee does not insist on continuation of employment, the employment relationship is deemed to have been terminated by agreement, unless stipulated otherwise. The day of termination of employment is the day of expiration of the period of notice, or the day of immediate cancellation or cancellation during the probation period envisaged for these two types of events. In these cases, the employee is entitled to compensation of wages in the amount of average earnings for the period of regular notice of dismissal.
If an employee serves an invalid notice or if immediate cancellation or cancellation of employment relationship by him or her during the probation period is not legally valid and the employer has notified him or her that he or she insists that the employee continue working, the employment relationship continues. If the employee does not comply with the employer's request, the employer may require damages starting from the day on which he or she notified his or her request concerning continuation of work. The employer must enforce the damages by an action before a court of law. Damages can be claimed only for a period of one month after an invalid termination of employment relationship. In cases of invalid termination by the employee where the employer does not insist on continuation of work, employment relationship is deemed to have been terminated by mutual agreement, unless otherwise agreed. In this case, the date of termination is the end of the period of notice or, in respect of cases of immediate cancellation or cancellation during the probation period, the day on which the employment relationship was intended to be cancelled. In cases referred to in the last sentence the employer cannot claim any damages from the employee.
In cases of an invalid agreement concerning termination of employment relationship the respective employee's entitlements in respect of compensation of wages are determined in the same way as in cases of an invalid notice of dismissal. In these cases, the employer cannot claim any damages from the employee.
Appeals to the court of law alleging invalidity of a termination of employment by means of dismissal, immediate cancellation or cancellation during the probation period can be submitted by either the employee or the employer within two month starting form the day when the contract of employment would have ended.
Hours of work
The working time is the period of time during which an employee is required to perform work for his or her employer. The length and distribution of working time are among the various working conditions the employer is required to observe.
The provisions of the Labour Code concerning working time are based on the ILO Hours of Work (Industry) Convention, 1919 (No. 1) and on EC directive 93/104/EC concerning certain aspects of the organization of working time, amended by Directive 2000/34/EC. Under EC Law the regular hours of work may not exceed 40 hours a week. Overtime is, however, permitted, provided the working week including overtime does not exceed 48 hours on average throughout a timeframe of four months. Under the Labour Code the maximum length of a shift is restricted to 9 hours within an even distribution of shifts and 12 hours in the case of an uneven distribution of shifts. In section 83 (2), the Labour Code provides for shorter working hours below 40 a week, in respect of specific working environments in which employees perform their job (underground work, etc.). Similar provisions concern work on three shifts or in a continuous work process. Young workers below 16 years of age are allowed to work for at most 30 hours a week and the length of their shift must not exceed 6 hours in individual days.
Regulations concerning overtime cover all employees in employment relationship and are contained, in particular, in the Labour Code and in collective agreements based on the provisions of the Labour Code. Exceptions from generally valid rules concern certain specifically defined groups of workers in accordance with section 5 of the Labour Code, and must be based on a special act. Special regulations apply for employees engaged in transport.
Overtime work means work performed by an employee at the instruction given by his or her employer, or with the employer's consent, over and above the weekly hours of work ensuing from the established work schedule. Overtime work must be performed outside the established shifts. The employer can order overtime work in exceptional cases where there are serious operational reasons, including during the period of the uninterrupted rest between two shifts and the days of weekly rest. However, uninterrupted rest between two shifts must not be shortened to less than 8 hours. The number of permissible overtime work for one employee is 8 hours a week, or 150 hours a year.
Overtime work must not be ordered to an employee who works shorter than the legal weekly working time.
In return for overtime work an employee is entitled to normal wages plus at least 25% of his or her average earnings, if time off has not been agreed in lieu of the overtime.
Night work is work performed between 10 p.m. and 6 a.m. The protective measures of the Labour Code apply to night workers who, within their regular working hours, work at least 3 hours at night within 24 consecutive hours. Working time of a night worker must not exceed eight hours in 24 consecutive hours, or an average of eight hours during a period of six consecutive months.
Employers have the obligation to organize a medical examination of workers who start working night shifts and repeat such examination regularly, at least at yearly intervals. Where a night worker asks to have his or her health condition examined, the employer is required to comply with his or her request with a view of tracing disorders, which may be caused by performance of night work. Costs of this health care must be borne by the employer, even in cases where health insurance companies pay for the employees' medical examinations.
The statutory period of annual leave is 4 weeks. Employees in organizations engaged in “non-entrepreneurial activities” have a right to 5 weeks of annual leave; teachers, pedagogical workers and higher education teachers are entitled to 8 weeks. A larger period can be defined by collective agreements. As mentioned before, the Ministry of Labour and Social Affairs is working on an amendment of the Labour Code, and it should include some changes in the length of annual holidays.
The employer decides the period when an employee takes his or her annual leave in accordance with a plan on which the employer obtains a prior approval from the competent trade union body. The employer is required to enable the employee to take full four or five weeks of leave, to which he or she is entitled, within the respective calendar year.
State public holidays are regulated by Act No. 245/2000 Coll., as amended (Czech version). They are 1 January, 8 May, 5 July, 6 July, 28 September, and 17 November. Other holidays are Easter Monday, 1 May, 24, 25, and 26 December. The distinction between State public holidays and other holidays has no impact on labour legislation. On holidays, the employer cannot require from his or her employee performance of any work and must not order performance of work. However, there are exceptions from this rule, as provided by section 91 (3) of the Labour Code. The legislation concerning public holidays has an impact on remuneration. An employee, who does not work because a holiday falls on his or her usual working day, is entitled to compensation of wages in the amount of his or her average earnings. An employee who works on a holiday is entitled to time off corresponding to the time worked, or wages plus bonus in the amount of average earnings.
Other leave entitlements
The Labour Code (sections 124 to 130) and other labour regulations include provisions concerning granting leave to employees, in particular in the event of impediments to work. The reasons enumerated in these regulations are numerous and refer to objective and subjective reasons for a temporary absence from work. Certain legally recognized grounds are personal in nature (sickness, care of a family member, training) others are related to a public interest (trade union activity, performance of a public office), still others are related to an economic or emergency situation in the undertaking (idle time, work stoppage).
Most frequently, impediments to work are classified into two categories taking into account the side on which the occurrence of the impediment lies. These are impediments on the part of the employee and impediments on the part of the employer. A further distinction can be made in depending on whether the employee concerned is or is not entitled to compensation of wages for special leave granted to him or her because of these impediments. These are then paid and unpaid impediments to work.
Impediments to work entail special rights and obligations both on employees and employers and important legal consequences are related to them. Impacts of impediments to work have been dealt with in more detail in the section of this profile dealing with suspension/interruption of the contract of employment.
Employees are entitled to special leave only in the event of impediments recognized by the Labour Code or by other labour legislation. They are the following: Government order No. 108/1994 Coll., to implement the Labour Code and certain other acts, as amended (English version), notification of the Ministry of labour and social affairs No. 18/1991 Coll., on certain action in public interest (Czech version), notification No. 172/1973 Coll., on granting leave to workers for the performance of trade union office, as amended, Act No. 143/1992 on salary and bonus for working readiness in budgetary organizations and some other organizations and bodies, as amended (Czech version).
Impediments to work
Impediments on the part of employees
Existence of a personal impediment to work must be proved by the employee concerned, for example by an invitation, certificate, a letter by which he or she was summoned by a state authority etc. If the employee is aware of the existence of the impediment, he or she must ask for the respective leave in due time and inform his or her employer on probable duration of such impediment. This obligation is imposed by section 23 of Government order No. 108/1994.
Impediments for reason of public interest
In accordance with section 124 (1) of the Labour Code, an employer is required to grant his or her employee, to the extent necessary, leave for performance of public office and other civic duties of public interest, if the employee concerned cannot perform these activities outside the working hours. This first group of impediments on the part of the employee can be referred to as impediments by reason of public interest. This can result in a long-term leave, where the employee is remunerated by the body where the public office is served, or a short-term leave, where the employer provides his or her employee with compensation of wages.
In accordance with section 14 of the Government order No. 108/1994 Coll., performance of a public office means, for example, performance of duties as member of Parliament, member of a local government body, or member of jury in a court of law.
Performance of civic duties means, for example, attendance in the capacity of witness, interpreter and other persons called upon by a court of law, or by any other State of local government authority, provision of first aid, attendance in an obligatory medical examination, participation in measures related to infectious diseases, other emergency events concerning preventive medical care, quarantine in respect of veterinary measures, provision of personal assistance in the event of fire, natural disasters, and other emergency situations, and all other situations where citizens are required by law to provide personal assistance.
Definition of other activities of public interest, duration of leave to be granted and entitlement to compensation of wages (pay) is provided by the notification of the ministry of labour and social affairs No. 18/1991 Coll. In accordance with this notification, special leave from work with compensation of wages is due to an employee, who accomplishes an activity of public interest, for example blood donation.
Special leave without compensation of wages is due to an employee in connection with other activities where public interest is less pronounced, the enterprise less involved, or when the employee concerned expects to be remunerated for these activities.
Finally, leave with or without compensation of wages is due, in accordance with section 2 of the notification referred to above, for activities for trade union purposes or involvement in the process of State inspections, even if this activity is not classified as public interest or civic duty. Leave of trade union officers for the performance of their duties is regulated by section 25c, para. 5 of the Labour Code and by notification No. 172/1973 Coll., on granting leave to workers for performance of office in the Revolutionary trade union movement, as amended. The trade union organization has no obligation to refund wages paid by the employer to trade union officials.
Performance of compulsory service in armed forces or of civilian service
Another type of impediment to work on the part of the employee is the performance of compulsory service in armed forces (performance of compulsory military service, substitute military service, military exercises, and other service in armed forces) and the performance of civilian service (section 125 of the Labour Code). This includes short-term impediments related to military service, such as situations where an employee is required to appear personally before a military administration unit, or to take a medical examination. In these cases, the employee is entitled to be granted leave and to receive compensation in the amount of average earnings. In connection with the employee's commencement of service in armed forces the employer is required to pay him or her wages for the first two weeks of his or her military (substitute) service in the amount of average earnings. In addition to this, employees with dependent family members (wife or husband and dependent children living in a common household as defined by the act on income tax) are entitled to special allowances for the period of military exercises and other types of military service.
Impediments for training and education related to employment
The third type of impediment to work on the part of the employee is training and education related to employment (section 126 of the Labour Code). The training activities should be related to meeting legal requirements or to obtaining knowledge and skills for proper performance of the agreed job (improvement of one's qualification). In these cases the employer can (but is no obliged to) grant leave or certain relief from work and provide with “material security” in cases where the training or studies are expected to result in an improved performance of the job. In these cases, i.e. where training is directly related to the performance of the work agreed upon in the contract of employment, such training is considered to be equivalent to performance of work. As a consequence, wages are due to the employee concerned.
Serious personal impediments to work
The fourth type of impediment to work on the part of the employee is serious personal impediments to work (sections 127 and 128 of the Labour Code). An employer is expected to grant leave from work in cases of absence due to illness, injury, treatment in a spa or admission into a health care facility, maternity leave, parental leave, quarantine, care of a family member, etc. The employee is not entitled to compensatory wages during this period. In these cases, his or her material security is regulated by the legislation concerning sickness insurance or state social support.
If an employee is not able to work for other important personal reasons, section 127 of the Labour Code expects his or her employer to grant him or her leave. Similar provisions can be found in Government order No. 108/1994 Coll., implementing the Labour Code, as amended (in particular sections 21 and 22 and Annex).
Special leave with compensation of wages is granted, to the strictly necessary extent, in cases such as: medical examination or treatment in a health care facility, confinement of the employee's wife, death of a family member, own wedding and wedding of children, etc.
Special leave without compensation of wages is granted in cases of the following important personal impediments: removal to another home with household equipment, search of a new job in cases of termination of employment at the employer's initiative (one day off each week during the period of notice referred to in section 45 (1) of the Labour Code - including cases referred to in section 46 (1), letters (a to (d of the Labour Code and mutual agreement on termination of employment for these reasons.)
Impediments to work on the part of the employer
Maternity protection and maternity leave
Section 48 (1) d) establishes a general prohibition of issuing a notice of dismissal to a female employee who is pregnant or parents having to care for a child under three years of age, as well as a prohibition of immediate dismissal (section 53(3)). The employer must be informed about the pregnancy. Exceptions to the prohibition rule are to be found in section 46 a) and b), and section 53.
Working conditions of pregnant women and employees who have given birth are regulated by chapter VII of the Labour Code.
The Labour Code in section 150 and following sets down a prohibition of certain types of work for biological reasons (disproportionately physical demanding work, underground work in mining, etc.), or for social reasons (fulfilment of maternity mission and protection in the labour market related to it). When a woman usually performs this type of work, she is entitled to a transfer to other work (section 153).
Notification No. 288/2003 defining activities and working places that are prohibited to pregnant women, to breast-feeding women, to mothers until the ninth month after delivery (…) (Czech version) conforms the Czech law with EC law (Directive 92/85/EEC) on this matter.
There are also certain adjustments concerning business trips (section 154 of the Labour Code) and the working time (section 156). The pregnant or nursing employee may request that her working time be reduced. The employer cannot require her to work overtime.
In accordance with section 161 of the Labour Code, the employer is obliged to grant a breastfeeding mother, in addition to breaks for meals and rest, additional daily breaks for breastfeeding.
Chapter V dealing with health and safety at work contains special obligations on employers regarding protection of pregnant women and mothers up to the ninth month after having given birth, or who are breastfeeding (section 133 (1) a) and (2)), such as the obligation to provide them with rest areas at the workplace.
In general, a woman-worker is entitled to maternity leave for a period of 28 weeks (section 157 of the Labour Code). The employees concerned have a right to maternity benefit (“cash assistance in maternity”) in accordance with the sickness insurance legislation.
The provisions concerning parental leave were included in the Labour Code in accordance with EC directive No. 96/34/EEC concerning parental leave. In accordance with this directive, parental leave is an individual and non-transferable right of each parent, which enables the child to be cared for by his or her mother, father, or alternately both parents, on the grounds of birth or of adoption of a child (sections 159 and 160 of the Labour Code). Parental leave is granted to a mother after termination of her maternal leave, or to a father after the birth of the child, until the time when the child reaches three years of age. During parental leave, parental benefit is provided only to one of the two parents, in accordance with Act No. 117/1995 on state social support, as amended (Czech version).
Minimum age and protection of young workers
The protection of young workers is regulated by the above-mentioned Notification No. 288/2003 defining activities and working places that are prohibited to pregnant women, to breast-feeding women, to mothers until the ninth month after delivery, to minors and conditions under which minors can exceptionally execute such work as a part of their training (Czech version). This notification on the elimination of child labour and the protection of young workers conforms Czech law to EC law, in particular Directive 94/33/EC of 22 June 1994 on the protection of young people at work. The directive's main objective is to prohibit the employment of children. It applies to “young people”, i.e. people under the age of 18. A “child” is a young person under the age of 15 or who is still in full-time compulsory education under national law. An “adolescent” is a young person between the ages of 15 and 18 who has terminated compulsory school attendance.
The Directive and the Labour Code include provisions relating to the obligations of the employer and the protection of working conditions by adolescents. The employer must take the measures necessary to protect the safety and health of working adolescents. There is a prohibition for adolescents to carry out certain types of work, such as work that exceeds the mental or physical capacities of young people or work involving eventual exposure to accidents as a result of the fact that they do not yet have the full maturity to assess the risks involved. Provisions of section 167 of the Labour Code, as well as provisions of the implementing labour legislation enumerate the types of work, which are prohibited to adolescents.
Directive 94/33/EC further regulates the working time allowed for young workers. As a general rule, the adolescents must not work more than eight hours a day and 40 hours a week. There are also more specific regulations applying to a combined work/training scheme.
Night work for adolescents is prohibited, with some exceptions in particular in sectors such as hospital work, the armed forces or the police.
To conclude, of a contract of employment with an adolescent, the opinion of his or her parents or legal representative must be requested. They must also be informed about a notice of dismissal or immediate termination of employment at the initiative of the employer.
In accordance with section 1 (3) of the Labour Code the employer has the obligation to ensure equal treatment to all his or her employees in respect of remuneration for work, including other benefits of monetary value, professional training and opportunity for advancement at work. The equal treatment principle relates to all employees' labour relations and to the whole duration of these relations from the start until the termination of the employment relationship. Taking into account the last sentence of section 28 of the Labour Code, negotiations preceding the conclusion of the contract of employment are also covered.
Equal treatment of all employees means, above all, that no direct or indirect discrimination will exist against employees in the areas of working conditions, remuneration for work, professional training and other areas referred to above. However, there is a special protection of women workers related to pregnancy and maternity, including performance of jobs prohibited to women for health reasons. Equal treatment in matters of working conditions, training and advancement is thus not applied in this case. This also includes more favourable treatment provided to members of the underrepresented sex to enable them to seek employment in certain categories of jobs, or prevention and/or compensation of handicaps concerning promotion in employment. These are the reasons why the Labour Code provides for a basic framework for the definition of cases that are not regarded as discriminatory on the basis of sex.
Provisions concerning equal access to employment, including prohibition of announcements and advertisements of job vacancies in contradiction with this principle can also be found in Act No. 1/1991 Coll. on employment, as amended (English version). If an employee feels that he or she was victim of unfair and unequal treatment, redress can be sought by means of a complaint submitted to the competent labour office, or court of law. The law concerning judicial proceedings provides that the employer has the burden of proof in all cases dealing with violation of equality of treatment in respect of sex.
As regards training, the employer must apply the equal opportunity and treatment principles to participation of all employees in training courses and studies during employment, the objective of which is acquisition of enhanced or updated skills required for the performance of the job.
The principle of equal treatment must also be observed in respect of opportunities for promotion in employment or possible transfer to more attractive jobs. When deciding about criteria and their application concerning the placement of employees within the organizational structure of the company and for the promotion to higher grades (to various management levels), the employer is required to proceed in such a way that the equal treatment principle is not violated.
Prohibition of discrimination
Act No. 46/2004 Coll., effective since 1 March 2004, implementing European Directives 76/207/EEC regarding equal treatment and 2000/78/EC on the prohibition of discrimination into Czech law, introduces new definitions of direct and indirect discrimination.
Direct discrimination is understood to mean a situation where a discriminating action directly leads to preference or exclusion of persons and results in denying or impairing their equal opportunities and treatment in labour relations. Indirect discrimination means that a specific measure, practice or applied criterion is essentially neutral (i.e. action taken by the employer is, as such, in conformity with law). However, the implication of such measure, practice or action causes total or partial exclusion or preference of certain groups of workers (women and men, young and old, mainstream population and ethnical minorities, etc.).
In accordance with section 1, para. 4 of the Labour Code, discrimination against employees is prohibited on the basis of race, colour, sex, sexual orientation, language, creed and religion, political or other opinion, membership and activity in political parties and movements, membership in trade union organizations and other associations, nationality, ethnic or social origin, property, family extraction, state of health, age, marital or family status, and family responsibilities. Prohibited is also any action taken by an employer, the consequence of which is indirect discrimination against certain groups of employees. On the other hand, discrimination is not considered as such if the action concerned is based on the provisions contained in the Labour Code or in other labour regulations, or where there is a material well-founded ground, inherent to the nature of the job. Discrimination is understood to mean any distinction, exclusion or preference based on the discrimination criteria referred to above. The enumeration of discrimination criteria in the Labour Code is based on the enumeration of those criteria in article 3 of the Charter of fundamental rights and freedoms.
The prohibition of discrimination against employees based on the above criteria provided by the Labour Code is the result of the application of the principle of equal treatment. Where an employer commits an act of discrimination, an employee who feels hurt by this action may seek redress, as the case may be, in accordance with section 7 (4) to (6) of the Labour Code, or in accordance with sections 11 to 13 of the Labour Code. This does not preclude the possibility to seek protection in accordance with other provisions of the Labour Code.
In accordance with section 22 of the Labour Code, trade unions may supervise the respect of labour legislation, and thus of the principle of equality of treatment. Equal treatment is also a distinctive feature in collective bargaining and formulation of individual provisions of collective agreements.
The principle of equal treatment of all employees and prohibition of discrimination does not exclude different treatment of individuals or groups of employees in cases, where objective grounds for such treatment exist, (for example inherent requirements of the job). In addition, these grounds are based on social consensus, cultural, historical or moral development, grounds generally regarded as appropriate and necessary. In most cases, they are defined in various provisions of the Labour Code (provisions concerning protection of adolescents and women, special protection offered to pregnant women and mothers of newly born children, breastfeeding women). Furthermore, appropriate temporary measures designed to redress existing inequalities are generally not classified as being discriminatory in nature (positive discrimination). Such measures designed to provide support to certain groups of workers are referred to in the employment act. This is, for example, an obligation imposed on certain employers to offer jobs to workers with reduced working capacity (quotas expressed in percentage of the total number of employees).
The equality principle does not mean however that one cannot take into account specific requirements related to the nature of the job. Enforcing these requirements is legitimate and does not amount to discrimination. Thus making distinction, exclusion or preference based on required knowledge and skills for a given job cannot be regarded as a prohibited discrimination. However, when defining requirements for the performance of a job the employer must carefully examine whether valid grounds exist, for example, for hiring only a man or a woman worker to fill a given vacancy.
Act No. 46/2004 Coll., effective since 1 March 2004, amends the definition of sexual harassment introduced in the Labour Code in 2000. It stipulates that any act of a sexual character that the employee perceives as unwelcome, unsuitable or insulting, and which might lead to the creation of a hostile humiliating or unpleasant work environment, is an offence.
In accordance with section 7 (2) of the Labour Code, it is prohibited to misuse performance of rights and obligations ensuing from employment relationship to the detriment of other employees and to humiliation of human dignity. This category includes abusive or offensive behaviour including comments and proposals of a sexual nature at work, or behaviour of this nature can be perceived by the victim as a criterion for decisions concerning future working conditions.
The basic drawing line to decide whether a given behaviour is or is not sexual harassment is thus whether the person concerned perceives such behaviour as unwanted and offensive. Even one single demonstration of such behaviour can amount to sexual harassment if its effect is serious. Sexual harassment must be distinguished from mutual informal friendliness. Sexual harassment can include physical, verbal and non-verbal manifestations.
Inadmissible is also behaviour of sexual undertone that can be perceived as a precondition for certain decisions concerning future status of the employee concerned. In these cases acceptance or refusal on the part of the harassed person would affect decisions concerning recruitment, promotion, continuation of employment relationship, amount of wages or other conditions of work and the person concerned must be duly protected both by law and in practice.
Pursuant to Act No. 46/2004 Coll., mobbing is for the first time defined as any behaviour perceived by the employee concerned as unwanted, unsuitable or offensive, and which could affect personal dignity or create a humiliating or unpleasant work environment.
In addition to the general provisions of section 111 of the Labour Code, pay issues are regulated in more detail by two acts, namely Act No. 1/1992 Coll. on wages, bonus for working readiness and average earnings, as amended (English version), and Act No. 143/1992 Coll. on salary and bonus for working readiness in budgetary organizations and some other organizations and bodies, as amended (Czech version). The former regulates wages in the “entrepreneurial sphere”, while the latter deals with pay issues in organizations, where wages are part of the expenditure of the State budget.
In accordance with section 111 of the Labour Code wages may not be lower than the minimum wage, the amount of which is fixed by Government order and as rule take effect from the beginning of each calendar year. Account is taken of the consumer price index. In this way, minimum wages are regulated by the Government order No. 303/1995 Coll., as regularly amended (Czech version). Collective agreement can of course, fix wages at a higher rate than the minimum wage.
When a worker is paid at a rate, which is less than the minimum wage, the employer is required to pay the difference. This includes cases where the reason for low wages is related to alleged poor work performance. Statutory minimum wages cover all employees, irrespective of whether they are under a contract with indefinite or fixed duration or a temporary, main or subsidiary employment relationship. Entitlement to minimum wage exists even in cases where several contracts of employment exist between an employer and an employee because entitlement to wages exists independently for each contract of employment. However, regulations concerning minimum wages do not cover performance of work under contracts defined by the Labour Code as “agreement on the performance of an individual project” and “agreement on work activity”.
Starting from January 2004, the minimum wage rate is CZK 39,60 an hour for employees who are paid by the hour or CZK 6,700 for salaried employees (1.00 U$S = 26.5504 CZK). However, lower rates are fixed for specific categories of employees. Thus, in the first employment relationship of a worker aged 18 to 21, the minimum wage for the first six months is 90 per cent of the stated amounts. Minimum wage for adolescents (15 to 18 years of age) is 80 per cent of the above amounts, and for employees receiving partial invalidity pension 75 per cent of the above amounts. Finally, minimum wage rates for employees receiving full invalidity pension and for fully invalid adolescents not receiving an invalidity pension are 50 per cent of the above basic rates.
For the purpose of remuneration, employers can be categorized into those who are engaged in entrepreneurial (business) activities (joint-stock companies, incorporated companies, limited liability companies, co-operatives, etc., mostly private businesses) and those who are not concerned with entrepreneurial activities, mostly those who derive their income from public and similar sources (state schools, hospitals, community services, district offices, labour offices, etc.). The determination of pay in these two types of organizations is completely different.
Determination of pay in the private sector
In organizations engaged in entrepreneurial activities, labour legislation regulates only minimum wage rates, and wage fixing in excess of these rates is left to bargaining. Employers in this category are free to establish any remuneration system and any form of remuneration (monthly salary, hour or piece wage). This means that employers are free to determine wage tariffs independently (expressed in CZK per hour for different wage and salary grades). Furthermore, wages need not be determined by way of tariffs but agreed individually in contracts of employment, by collective agreements or can be fixed by internal regulations. Possible is also a combination of these approaches. This also includes freedom of decision concerning the structure of pay, i.e. basic wage, bonuses, personal assessment, various fringe benefits, etc.
However, conditions of pay must be defined and/or agreed in writing prior to the performance of the work concerned and the resulting amount may not be lower than the minimum wage. Where there is no collective agreement or where the collective agreement does not regulate pay issues, wages must not be lower than the minimum wage tariffs fixed by the Government order.
In addition, employees are entitled to increased wage rates, for example for work on public holidays, overtime, at night, in a working environment involving health hazards. They are also entitled to remuneration for working readiness completed in the workplace. In accordance with the established practice, increased pay and/or other wage components are provided for work on Saturdays and Sundays, for work where the shift is divided by a long mid-day interval, work in the afternoon shift, temporary assumption of the role of an absent superior, bonuses, assessment of personal contribution, 13th and 14th pay, etc. There is no express legal entitlement and these various supplements of pay can be defined by collective agreements, contracts of employment or internal regulations. Employers are free to make arrangements for excluding aggregation of these various pay supplements. In cases where an employee is transferred to other work for reasons specifically established by the legislation, for example symptoms of an occupational disease, idle time, etc., he or she is entitled to a supplement to compensate the difference between the new pay rate and his or her previous average earnings. Other cases where a transferred employee would be entitled to his or her previous average earnings can be determined by collective agreements.
If an employee is remunerated by a task wage and is required to meet certain standards, he or she must be fully briefed about these standards in advance. Subject to prior agreement with the employee, the employer can provide certain part of wages in kind (automobile, products, services, etc.).
Wages are due after performance of work, not later than by the end of the calendar month following the month when entitlement to wages originated. By means of a collective agreement or by means of an individual contract more advantageous intervals for wage payments can be agreed. Unless otherwise agreed, wages must be paid in cash, during working hours and at the workplace. The collective agreement can provide that payment of wages would take place elsewhere. Payment of wages to the employee's banking account must be based on a prior employee's instruction. Various deductions from the employee's wages can be made only concerning amounts defined by the respective legislation, for example the income tax, social insurance contributions. Other deductions can be made only subject to the employee's consent or under a court order.
Wages are mostly agreed by means of a contract of employment concluded between an employer and an employee, or by means of another type of contract, for example a wage contract. This is the usual procedure in undertakings where no unions operate and wages cannot be agreed by means of collective agreements. Individual contracts of employment may include provisions concerning other wage supplements, such as bonuses, work on Saturdays and Sundays, etc.
In undertakings covered by collective bargaining provisions concerning wages are mostly included in the respective collective agreements. Trade unions enjoy an exclusive right to conclude wage settlements. In particular, employees' councils (works councils) have no authority to negotiate wages. They are established only in undertakings without a trade union representation with a view to being provided with the prescribed information and to being engaged in consultations.
An employer can determine wages also by means of internal regulations or by means of individual unilateral wage assessment, which is not an integral part of the contract of employment. Finally, wages can be determined by a combination of the above (for example one part of wages is determined by a collective agreement, another part by internal regulations, and still another part by a contract of employment or by unilateral employer's decisions).
Determination of pay in the public sector
In these organizations, wages and all other wage components are determined by the respective legislation (in these cases the term “salary” is substituted to the term “wages”). Employers in these organizations are not free to establish an independent system of pay and are not allowed to provide salary components other than those foreseen by the respective legislation. Employees are paid by means of monthly salaries, by the so-called “tabular method” where salaries are determined by the employer in accordance with standards uniformly established in respect of all types of organizations.
Employees are classified into 16 salary grades (since 1 January 2004), which are scaled in accordance with complexity, responsibility and labour intensity and physical demands of the job. Each pay grade is divided into steps in which employees move in accordance with years of recognized practice. An employee is placed in the salary grade corresponding to the most demanding work, which he or she is expected to perform. For each grade the legislation has determined “qualification requirements” - educational level. Awarding of a salary grade and fixing the corresponding step is the basis for entitlement to a pay tariff, the amount of which is determined by the scale (table) of the salary grades appended to the respective pay legislation. Employers are not allowed to make any changes in these tariffs. The tariffs are increased only by means of amendments of the respective legislation.
In addition to these basic tariffs, employees are entitled to supplements for leadership, supplements for temporary performance of a management position, supplement for night work and for work on Saturdays and Sundays. They are entitled to salary and compensatory time off for work on public holidays, for a special salary supplement (work in hazardous working environment, extraordinary psychological demanding jobs, shift work, etc.), supplements for a divided daily shift, work in especially demanding and harmful environment, and remuneration for working readiness.
If the employer fulfils the conditions stipulated by the respective legislation, he or she also acquires the right to an additional salary, which is provided at the end of each semester (i.e. two additional monthly salaries a year). In addition to it, the employer can provide additional voluntary salary components, such as personal allowance (to recognize good results achieved by the employee) and special rewards to recognize fulfilment of extraordinary tasks, or special rewards provided at the occasion of the employee's 50th birthday, or at the occasion of retirement after award of an old age or invalidity pension.
The legislation concerning deductions from pay, payment of salary, intervals for salary payments, and in respect of transfer to other than agreed jobs is the same for both the private and the public sector.
Collective bargaining can take place in budgetary organizations, as well. Collective agreements may cover pay issues but it is not possible to negotiate different salary levels or salary supplements other than those referred to in the corresponding legislation. The same applies for internal regulations covering individual organizations in this sector. When a new employee starts working, his or her employer is required to issue a pay decision containing the allocated salary grade, the amount of monthly salary and the amount of other regularly provided monthly salary supplements.
Workers' representation in the enterprise: Trade unions and works councils
In accordance with Czech law, trade unions and trade union bodies are the only legitimate representative bodies of employees in labour relations that have the right to collective bargaining. Trade union bodies represent all employees in labour relations, including those who are not affiliated to any union. In June 2000, there were 3,972,400 employees in the Czech Republic, of which around 1,300,000, i.e. 33 per cent, were members in trade unions (Czech Statistical Office).
Since 1 January 2001, the Labour Code has introduced a new type of employee representation in organizations where there are no trade unions. In accordance with section 24 and the following, these employees can establish employee councils (works councils). Works councils can mediate in relations between the employers and employees and are called upon to enforce the right of employees to information and consultation. The law has not conferred to them the status of juridical person and, consequently, they cannot negotiate on behalf of all employees with legal effects and cannot conclude collective agreements. There are provisions in the Labour Code and in other legislation conferring to the trade unions, within the area of labour relations, the right to participate in decision making, the right to co-determination, the right to information and consultation concerning matters relating to employees interests.
Furthermore, trade union bodies enjoy a significant right of control over observance of labour law by the employer (section 22 of the Labour Code) and the right to perform controls over health and safety (section 136). The Labour Code also envisages prior consultations on draft labour legislation (section 23). Thus unions enjoy a significant right to participate in law making.
A special feature of the Czech law consists of the fact that, unlike in many other countries, parallel existence and functioning of unions and employee councils in the same company is not allowed. Functioning of employee councils is conceived as an alternative solution for situations where employees' interests cannot be defended by a trade union. Employee councils can be elected in companies with more than 25 employees in regular employment relationship. An employee council has at least 3 members and at most 15 members.
The employee councils have no authority for collective bargaining nor can they call on strikes. As distinct from trade unions, employee councils cannot create higher level structures and, as a consequence, cannot participate in social dialogue at industry level or even at supreme level (tripartite dialogue).
These rules enabled the Czech Republic to ratify the ILO Workers' Representatives Convention, 1971 (No. 135), in October 2000.
The Czech Labour Code also contains provisions for the implementation of the European Works Council Directive (94/45/EC). These provisions (section 25d to 25k) took effect as from 1 May 2004. The European Works Council enables employees of multinational companies meeting certain conditions to have access to information regarding the company and to discuss it with the employer.
Trade union regulation
Trade unions are Private-Law associations. In accordance with Act No. 83/1990 Coll., three members can establish a trade union organization, or an employer organization. The legislation (except for Act No.186/1992 Coll. on service relationship of the Police) does not stipulate other criteria for association, not even a criterion of representativity.
The right to associate and establish trade unions is enshrined in article 27 of the Charter of fundamental rights and freedoms (English version), which is integral part of the Constitution of the Czech Republic (article 3 of the Constitution). Activities of trade union organizations and activities of other association established with a view of protecting economic and social interests can be restricted by law only in cases where such measure is essential to protect the security of the State, the public order or rights and freedoms of others in a democratic society. The provisions of the Charter do not allow to restrict plurality of trade union organizations or to give preferential treatment to some of them. An employer is not allowed to prohibit his or her employees to become members of the existing trade union organizations. The same applies to the establishment of new trade union organizations and/or their independent activities. An employer must not discriminate against his or her employees, or put them in any disadvantage, in connection with their trade union membership or activities (on the other hand, he or she has no obligation to support establishment of new trade union organizations).
The establishment of trade union organizations, their confederations, as well as the establishment of employer organizations in the Czech Republic and their federations is governed by Citizens' Association Act No. 83/1990 Coll., as subsequently amended (English summary, Czech version). The Czech Republic has ratified the ILO Freedom of association and protection of the right to organize Convention, 1948 (No. 87).
Workers and employers organizations are established without any State intervention and the State is not allowed to interfere in their internal affairs. Act No.83/1990 Coll. does not include any criteria of representativity for trade union and/or employer organizations. The State (the Ministry of Interior) is only called upon to register the establishment of these organizations and performs a general supervision in order to find out whether their activities are of an occupational nature and whether trade unions are not involved in activities normally undertaken by political parties or those of business companies. The latter are governed by other legislation. Trade Unions can be unified in confederations, associations or federations. In the Czech Republic a confederation principle is prevailing as it secures independence for the Trade Unions. The Czech-Moravian Confederation of Trade Unions (CMKOS) and the Association of Independent Trade Unions (ASO) are representative confederations in the tripartite Council for Economic and Social Agreement.
Specific rules concerning the right to associate apply to certain sectors such as the military (Section 45 of Act No. 221/1999 Coll. on regular soldiers, as amended, Czech version), the Police (Section 143 of Act No. 186/1992 Coll., Czech version), the Fire – fighters' rescue corps (Section 10 of Act No. 238/2000 Coll. on the Fire - fighters' rescue corps of the Czech Republic, Czech version), and the Customs (Section 12, paragraph 3 of Act No. 13/1993 Coll. (the Customs act), as amended, English version).
Both trade unions and employer associations have declared in their constituent documents and by means of statements made by their statutory representatives, independence from political parties.
The present regulations, in particular those contained in the amended Labour Code, have created further prerequisites of trade union independence. Thus, for example, the employer is required to create conditions for employee representatives (trade unions, employee councils) to enable them to perform their duties, in particular to provide them, in accordance with operational means and in appropriate extent, with reasonably equipped rooms, to cover costs of maintenance and operation and to provide them with background documents and information. In spite of this, there are cases where employers in certain companies try to exert influence on trade union bodies, including by means of offering certain benefits to trade union representatives.
Section 18b (1) of the Labour Code provides that trade union organizations have the right to participate in labour relations, including collective bargaining, under conditions stipulated by law. The Labour Code further enumerates a number of special rights in their relation with the employer and defines situations where the employer is required to provide information, arrange for consultations concerning certain envisaged measures before their implementation, and, in certain other cases, situations where there is a right of co-decision or mutually agreed action. According to existing legislation, trade unions represent all employees, including non-organized workers. Trade union organizations can mostly be found at the level of enterprises but they are also established on a regional basis and do also associate citizens having no employment relationship (the unemployed, pensioners, women workers on maternity leave, self-employed workers who do not employ other persons).
Collective Bargaining and Agreements
Collective Bargaining regulation
Act No. 2/1991 on collective bargaining, as amended (English version), lays down the right to collective bargaining, as well as the regulation of the process of concluding and implementing collective agreements.
The Labour Code and other labour legislation comprise the material law basis for negotiating collective agreements at company and higher levels. As mentioned above, the legislation on negotiating wage entitlements has been substantially more liberal since the start of the transformation period. Labour-law entitlements other than wages, which can be agreed on at a level going beyond the scope defined by law include e.g.:
- Reducing working hours below the number stipulated by the Labour Code;
- Extending vacations with additional weeks;
- Increasing or extending entitlements to paid leave or salary compensations of some acts in the public interest;
- Extending leave of absence and subsidies for training and vocational study and for time off owing to serious personal reasons, etc.
The Collective Bargaining Act No. 2/1991 Coll., as amended, also regulates the right to strike and lockout, as well as the process of solution of collective disputes. The Czech Republic has ratified the ILO Right of Association and Collective Bargaining Convention, 1949 (No. 98). Partners to collective bargaining are defined and the law states who has the authority to conclude collective agreements. It also regulates conditions for collective agreements to become a valid contract with binding effects on both parties.
The law distinguishes between two types of collective agreements. These are enterprise agreements, which are concluded at company level with individual employers, and higher-level agreements concluded between the competent higher trade union organ (body) and the relevant employers' association or associations . According to the law, no direct link (superiority or subordination) exists between company collective agreements and higher level (branch) collective agreements. If a company collective agreement defines conditions provided to employees in a less favourable manner than those defined by a higher level collective agreement, the latter prevails. In these cases the employer would be bound by the respective provisions of the higher level collective agreement. However, higher level collective agreements are binding only on the employers who are members of the associations which have signed the agreement, unless the agreement has been extended to third parties in accordance with Section 7 of the Collective Bargaining Act (see below).
The aim of collective bargaining in the Czech Republic is the conclusion of a collective agreement. Other forms and phases of collective bargaining, which are not aimed at negotiating company collective agreements or higher level collective agreements or their changes, are part of the social dialogue. They are not subject to legislative regulation and are in practice governed by the partners' procedural customs.
Collective bargaining is opened when one of the parties submits to the other party a written proposal for the conclusion of a collective agreement. The latter is then obliged to respond to the proposal in writing without undue delay, and to make a statement on those parts of the proposal that have not been accepted. Rejecting the proposal as a whole is not admissible under the law, regardless of the justification. The partners are obliged to negotiate with one another and provide any cooperation requested. 60 days at the latest before the expiry of a collective agreement, they are obliged to commence negotiations on concluding a new collective agreement.
A collective agreement is concluded for a period explicitly specified in it. If not stipulated otherwise, it is presumed (by the law) that the agreement has been concluded for one year. To make changes or to supplement the agreement, the parties proceed the same way as when concluding the original collective agreement. According to the law, renunciation of a collective agreement is not possible.
The identification of those who can sit at the bargaining table is a crucial factor in concluding collective agreements. For higher-level collective agreements, it is frequent that the employees' representatives face the problematic absence of competent bodies for collective bargaining within the employers' organizations. That concerns instances where employers' organizations have not been established in accordance with Act No 83/1990 Coll., or in case they are (or they plead to be) unable to conduct collective bargaining because of their articles of association not giving authorization for it, or that authorization is restricted to certain members of the organization and has to be renewed on a case by case basis, etc.
A particularly serious problem is legitimacy to conclude higher-level collective agreements in the public sector and, in particular, in the sector of public administration. The Trade Unions operating within the sector of public administration are unable to conclude collective agreements of a higher level by reason of the absence of a contractual partner to conduct collective bargaining with, as the legislation does not enable employers in this sphere (public bodies) to form employer unions.
Extending the binding effects of higher-level collective agreements
According to article 7 of Act No. 2/1991 Coll. on collective bargaining, the Ministry of Labour and Social Affairs may stipulate in a legal regulation that a higher-level collective agreement is also binding for employers who are not members of the employers' organization, which concluded that agreement. A higher-level collective agreement may only be extended to employers with similar activities and economic and social conditions, and who are not committed to another higher-level collective agreement.
Regulation on extending higher-level collective agreements has been made more concrete by the specific measure agreed on between the government and social partners in the tripartite Council of Economic and Social Agreement (“Procedure on extending higher-level collective agreements”). According to this procedure a commission set up on a parity basis, which works at the Ministry of Labour and Social Affairs as an advisory body to the Minister, negotiates the extension of higher-level collective agreements. The Ministry of Labour and Social Affairs must review the content of higher level collective agreements for compliance with the labour law regulations prior to extending them and has to publish its notice about extending the binding force of a higher-level collective agreement in the Collection of the law.
Over the years, the rather flexible Czech system has enabled the social partners to seek and verify in practice the optimal criteria and procedures, reaching consensus and implementing changes in a more supple way than they would have been able to, in the case of having to comply with the requirements of the legislation procedure.
Settlement of collective labour disputes
In the period following 1989, the Czech Republic launched extensive economic and administrative reforms. The impact of the resulting changes was strongly felt in the area of labour relations. Privatization and transformation of state-owned enterprises, phasing-out of a number of industries (for instance, metallurgy and mining), low-success marketing rate of some Czech products in European markets – all that brought about dismissals, cuts in working hours, arrears in labour pay, losses in employee-awarded fringe benefits and social security, impossibility of obtaining adequate jobs in several regions with high unemployment rate, etc. These negative effects led to many labour disputes for the settlement of which, though only under exceptional circumstances, extraordinary means, including strikes, were chosen by employees (or rather, by their Trade Unions).
Strike, as the ultimate solution of a labour dispute is quite exceptional in the Czech Republic. Some 20 strikes (but no lock-outs) took place during the mentioned period, the majority of which just lasted for several hours. One of the longest strikes declared by railway workers who demanded the cancellation of the overall government transport strategy was organized in February 1997 and lasted for four days. A strike that took place on 21 April 2004 in the public service to protest against cuts in the “thirteenth month's” salary, lasted for one hour. To settle their labour disputes, Czech employees resort more frequently to protest demonstrations and meetings, rather than to strikes. On those occasions, employees (through their Trade unions) present their views and demands concerning both the solution of economic problems and the solution of labour disputes.
The overwhelming majority of disputes relate to pay issues. In the second place are disputes over co-decision powers of Trade Unions and management, be it the tendency of Trade Unions to get more comprehensive regulation on decision-making powers in collective agreements, or the enforcement of compliance with such provisions. The third area worth noting relates to disputes over income and expenditure aspects of the Social Fund and several other similar funds. Other subjects for disputes are demands concerning working conditions, levels of compensation on the dismissal due to organizational changes on the part of the employer, etc. It is evident from the available data that labour disputes are mostly settled by collective bargaining.
The Collective Bargaining Act regulates collective disputes relating to the conclusion of an agreement and disputes concerning the application and enforcement of obligations arising out of an agreement, but not those relating to the claims of individual employees. When a collective dispute arises, the parties may agree to appoint a mediator. If they fail to agree on a mediator either party may ask the Ministry of Labour and Social Affairs to make such appointment from a list, which is kept by the latter.
A mediator in a collective dispute does not have the power to issue decisions. Based on discussions with the involved parties and on a jointly conducted analysis of the dispute nature, the mediator issues a written communication for both contractual parties, containing a proposed settlement of the said dispute. The mediator is required to do so within 15 days from the date on which he or she appraised the dispute, provided the contractual parties do not agree otherwise. Should a dispute not be settled within 30 days from the day on which a mediator took up the said dispute, and the contractual parties have not agreed otherwise, a hearing by mediator fails. The fees and costs of the hearings are shared by the two parties.
When mediation has been unsuccessful, the parties may submit their dispute to an arbitrator, whose award should be issued no less than fifteen days as from the beginning of the arbitration procedure. However, the parties are also free to engage into industrial action unless the dispute concerns a collective agreement relating to a workplace where strike is forbidden, or it concerns performance of obligations arising out of a collective agreement. In such cases either party may request the Ministry to appoint an arbitrator.
The Ministry of Labour and Social Affairs keeps a list of arbitrators. To be included in the list, arbitrators must, among others, pass regular examinations of their expertise before a Ministry of Labour and Social Affairs committee. The Ministry of Labour and Social Affairs covers from the National Budget both the arbitrator's fee and the costs of the hearings.
The arbitrator's award is in principle final and binding, as it cannot be reviewed by a court, unless the dispute relates to the fulfilment of obligations arising out of a collective agreement. For such an appeal to be received, either of the parties must submit a review motion within 15 days after the arbitrator's award has been issued. The parties cannot appeal to the decision rendered by this court.
Strikes and lock-outs
The Collective Bargaining Act only covers strikes and lock-outs as a last resort to settle a collective dispute. The legislation defines a strike as a partial or total interruption of work on the part of employees. A lock-out is a partial or total interruption of work enforced by employers. A special type of strike is a so-called solidarity strike defined in the relevant legislation as an action in support of demands of employees striking in a dispute over the conclusion of another collective agreement. Only the relevant trade union can declare a strike.
The Collective Bargaining Act only deals with strikes (solidarity strikes) concerning the conclusion of collective agreements (section 16 and the following). Strikes for the fulfilment of obligations in a collective agreement are inadmissible, and a collective dispute on the fulfilment of the agreement is resolved in the presence of mediator or, should that fail, an arbitrator whose decisions may be generally reviewed in court. Other kinds of strikes, i.e. strikes that do not involve collective bargaining, are admissible provided they are not contrary to the Charter of Fundamental Rights and Freedoms.
Preparation and declaration of strikes and lock-outs
The Collective Bargaining Act describes in detail the procedures that govern the preparation and declaration of strikes or lock-outs, the participation of employees in strikes, as well as the issues related to their pay and social claims during a strike or a lock-out. A prerequisite for the declaration of a strike is the consent of at least half of the employees, to whom the respective collective agreement applies (be it a company or a higher-level collective agreement). A striking employee is the one who has consented to be involved, or who has joined the said strike later. An employee shall neither be prevented from participating in a strike nor shall he or she be forced to participate in a strike. An employee who does not participate in a strike should be allowed reasonable and safe access to his or her workplace. An employer is not permitted to dismiss an employee because he or she participated in a strike.
As for the pay of employees during a strike, the following provisions, among others, apply. During his or her participation in a strike, an employee is not entitled, neither to wage nor to reimbursement thereof. Nor is he or she entitled to sickness benefit if the conditions stipulated in the sickness insurance provisions were only met while taking part in the strike. During a lock-out, an employee is entitled to receiving wage reimbursement equivalent to half of his or her average earnings. With respect to old-age pension plans, the participation in a strike and the period of a lock-out are considered as periods of regular job execution and job retention.
Trade unions are required to co-operate with the employer during the strike in protecting equipment from loss, damage, destruction or misuse, and maintaining essential facilities or activities where this is necessary, because of their nature or on health grounds or to avoid damage. The trade union will be liable to the employer for damage caused by its failure to co-operate in these cases.
The Collective Bargaining Act names the workplaces and professions where strikes or lock-outs are prohibited. These workplaces include medical and welfare facilities provided the strike or lock-out might endanger life or health. Strikes are also prohibited for workers operating nuclear power stations, those dealing with fissionable material, oil pipelines, and gas lines. The prohibition also covers fire-brigade members and members of rescue squads set up at the respective workplaces based on specific regulations, workers ensuring the operation of telecommunications, if a strike could result in life or health hazard or a damage to property, workers in areas affected by natural disasters where emergency measures had been declared by the relevant state authorities, etc. Judges, public prosecutors, and members of the armed and security forces must not participate, as set by the Bill of Rights, in any strike organized for whatever reason.
The Collective Bargaining Act lays down certain material (legal) consequences attached to illegal strikes or lock-outs. Provided a court declares a strike illegal, the Trade Union, which has declared the said strike, is accountable to the employer for the damage incurred, in accordance with the respective provisions of the Civil Code. An illegal strike can have certain adverse implications even for its participants. Naturally, the employer is not required to pay any wages for the period of the said illegal strike. Moreover, participation of an employee in an illegal strike can be seen as unexcused work losses, which may imply sanctions as provisioned in the relevant labour legislation.
From the respective provision of the Collective Bargaining Act, one can infer that, should an illegal lock-out is carried out, an employee who was prevented from executing his or her job because of the said lock-out is entitled to the reimbursement of his or her wage at the level of average earnings. This does not bar employees from filing claims, according to the Labour Code, with their employers for possible further damage incurred.
Settlement of individual labour disputes
The procedure available for the settling of individual labour disputes is that of court proceedings. There are no special courts in the Czech Republic, which would be called upon to deal with individual labour conflicts. These are subject to civil proceedings before a court, on the same footing as other civil court proceedings (Act No. 99/1963 Coll. Civil Procedure Code, as amended). Labour disputes are judged by tribunals consisting of one professional judge and two lay judges (court of first instance), or by tribunals consisting of three professional judges (Court of Appeal).
The first instance hearing is opened when a motion to commence proceedings is delivered to the district court having local jurisdiction over the place of residence of the defendant. The burden of proof generally lies with the claimer. The judgment of a court of first instance may be reviewed in appellate procedure.
It is necessary to emphasize, that it can be agreed, by means of the applicable collective agreement, that individual labour disputes will first be discussed by a company conciliations body. However, the establishment of such a body is without prejudice to the option to apply to a court of law without having the case first considered by the conciliation body. Furthermore only the ruling of the court is binding.
In the Czech Republic, the institution of labour inspection does not exist. In accordance with Act 1/1991 Coll. on employment, as amended (English version), some controlling activities are performed by public employment services, i.e. by labour offices. Activities of these inspection bodies are directed at compliance with legal provisions on employment and on establishment, changes and termination of employment relationship, employment of young persons, etc.
ILO Conventions ratified by the Czech Republic
Useful web links
For legislation in Czech:
- Ministry of Labour and Social Affairs
- Bibliography (Charles University – Faculty of Law)
- http://sweb.cz/sbirkazakonu/ (generally binding regulation)
- http://www.sbirka.cz/ (generally binding regulation)
- http://www.esipa.cz/sbirka/ (generally binding regulation)
- http://dir.seznam.cz/Spolecnost/Zakon_a_pravo/zakony_vyhlasky/ (generally binding regulation)
- http://dir.seznam.cz/Spolecnost/Zakon_a_pravo/pracovni_pravo/ (generally binding regulation)
- http://www.aspi.cz/ (generally binding regulation)
- http://www.legis.cz/ (regulation, interpretation)
- http://pracovni.juristic.cz/ (regulation, interpretation)
- Research Institute of Labour and Social Affairs
For legislation and relevant articles in English:
- Generally binding legislation
- NATLEX ILO national legislation database
- EUR-lex European Union Law
- British Chamber of Commerce in the Czech Republic
- Squire, Sanders & Dempsley L.L.P., look for the EU Accession series
- JUDr.Marcela Kubínková: Sebeobrana zamestnance, Sondy, s.r.o., Praha 2002
- Miroslav Belina a kolektiv: Pracovní právo, ucebnice, C.H.Beck, Praha 2001
- M.Soucková a kolektiv: Zákoník práce, Komentár – III. vydání, C.H.Beck, Praha 2001
- Hochman, J., Jouza, L., Kottnauer, A., Zákoník práce a související predpisy, Linde, Praha 2001
- Ing. Ludek Merta a kol.: Zákon o mzde, Sondy, s.r.o., Praha 2001
- Ing. Ludek Merta a kol.: Zákon o platu, Sondy, s.r.o., Praha 2001
- Kubínková Marcela: Zákoník práce po novele, Sondy, s.r.o., Praha 2000
- Šubrt Borivoj: Odbory, zamestnavatelé a právo, Paris, Praha 1995
- Tomeš Igor, Tkác Vojtech: Kolektivní smlouvy a kolektivní vyjednávání, Prospectrum Praha, 1993.
Web information in English:
- Czech Labour Law on the threshold of EU accession, Article published by the British Chamber of Commerce in the Czech Republic, 19 March 2004.
- Czech Labour Law, Article published by Squire, Sanders & Dempsley L.L.P. EU Accession Series, December 2003.
- For information on employment relations in small enterprises: Report by the European Foundation for the Improvement of Living and Working Conditions, Employment relations in micro and small enterprises – literature review. Country profile: Czech Republic, 2001.
Contributed by: Dr.Marcela Kubínková, 30 October 2002.
Updated by: Natacha Wexels-Riser,13 May 2004.
Please, send your comments to: Labour Law Observatory