Czech Republic
Old Central European architecture, great food, and some top-tier remote talent: The Czech Republic is a popular place to hire. If you’ve found someone you’d like to hire remotely there but are a little less sure how to go about it, you’re in the right place. In the next few minutes, you’ll learn how you can hire someone in the Czech Republic—no matter where your company’s located.
Country snapshot
CURRENCY
Czech Koruna (CZK)
EMPLOYER TAXES
33.80%
PAYROLL FREQUENCY
Monthly
OFFICIAL LANGUAGE
Czech
It’s the fastest way to hire globally
Hiring employees takes months, at the minimum. When you hire with Thera's locally-generated contracts, it’s a matter of days or weeks. This means you can hire the best talent, fast, without losing them to a hellish procession of paperwork.
It’s a lot cheaper
It costs just $0 to sign up for Thera, then $25 per month to hire your contractors with Thera. If you hired employees manually (or did contracting on your own), you’d likely be on the hook for thousands of dollars each month. Setting up an entity alone can cost tens of thousands of dollars.
It’s more flexible for you & your team
Can be less risky than hiring employees
Hiring employees is a bigger commitment, and can open you up to increased liabilities and regulations. When you hire contractors overseas, your biggest risk is misclassification—but laws surrounding contractor classification are often significantly more straightforward.
Some people want to be employees
The contractor life isn’t for everyone—some people want the security that being an employee often appears to provide. Though it’s rare, this does happen, and it’s one disadvantage of manage an all-contractor team.
You might not have as much control over your talent
Most countries’ contractor-employer relationship laws stipulate that the employer can’t set fixed working hours, among other things. These laws give contractors more freedom over how and when they do their work than an employee would have. In reality, however, most contractors are willing & able to work on the company’s schedule—it’s a matter of setting expectations beforehand.
No matter where you’re based out of, we can tell you one thing: the Czech Republic has different labor laws than your home country (well, unless your home country is the Czech Republic, of course). If you don’t do things right, you’ll be putting your company at the risk of fines—and risk losing the talent you brought onboard.
Hire talent as contractors
Hire talent as employees
If you’ve read up until this point, you’ll know that it’s easier, cheaper, and more flexible to hire contractors in the Czech Republic than employees. Still, there are valid reasons why you might want to hire employees instead. The content below is for you—we’ll cover employer taxes and obligations in the Czech Republic.
Employer tax
Employer Contributions
- 33.80%
Paid Time Off (PTO)
Employees are entitled to 4 weeks of paid leave.
Public Holidays
There are 13 public holidays.
Sick Days
During the first 14 days of illness, the employee is entitled to receive 60% of their regular wages, so long as the employee has fulfilled the conditions to be eligible for this entitlement.
Maternity Leave
In the Czech Republic, a woman is entitled to 28 weeks of maternity leave or 37 weeks for multiple births. The leave can start at least 8 weeks before the expected due date, but no later than 6 weeks. Maternity leave is compensated at 70% of the regular salary, however, this amount depends on how much the employee has contributed to social security. In addition, at least 14 weeks of maternity leave must be taken.
Paternity Leave
New fathers are able to take leave in lieu of the mother after the first 7 weeks from birth.
Parental Leave
The mother is entitled to parental leave starting at the end of the maternity leave and the father is entitled to the leave starting from the child’s birth until the child reaches the age of 3. This leave can only be taken when the child is being cared for from home.
Parents are entitled to a maximum allowance of 220,000 CZK until the child reaches the age of 4 or 330,000 CZK for multiple births.
Other Leave
None.
Marriage Leave
None.
Bereavement Leave
None.
Termination Process
An employee can be terminated:
- By a mutual agreement between the employee and employer
- Notice of termination by either the employee or employer.
- The notice must be delivered in writing
- If the employee is resigning, they are not required to give a reason
- If the employer is terminating the employee, the employee is obligated to list the reason for termination.
- Notice of termination cannot be given during the protection period (i.e the employee is pregnant or on maternity leave, the employee is unfit for work, etc.)
- For immediate termination for a reason that is specified under the Labor Code
- Within a probationary period
- On an agreed date if the employment contract is for a definite period
- In the event of death of the employee
Notice Period
The notice period for the employee or employer must be at least 2 months. It is possible to extend this period if both parties agree on a longer notice period and must be agreed upon in writing. The notice period commences the first day of the month following the delivery of the notice.
Severance Pay
Depending on how long the employee has been employed, the amount of severance pay to be paid out will vary:
- 1 year of employment: 1 months’ gross salary
- 2 years of employment: 2 months’ gross salary
- 3+ years of employment: 3 months’ gross salary
Probation Period
The probation period is a maximum of 3 consecutive months for regular employees and up to 6 consecutive months for chief officers. The probationary period must be agreed upon in writing and cannot be longer than half of the agreed period of the employment relationship.
Working Hours
A full-time workweek is 40 hours or 8 hours per day. The length of a shift cannot exceed 12 hours.
Overtime
Overtime work can only be performed as an exception and cannot exceed 150 hours within a calendar year.
If there is an agreement between the employee and employer in regards to work beyond regular hours, overtime cannot exceed 8 hours a week for more than 26 consecutive weeks. If there is a collective agreement, overtime may be increased.
For managerial positions- the maximum amount of overtime that can be negotiated is 150 hours per year.
Overtime pay is as follows:
- Overtime pay is 125% of the regular pay. It is also possible to give additional time off in place of overtime pay.
- For work over holidays, employees are entitled to their wages plus time off.
- For work over the weekend, the overtime pay rate is 110% of the regular wages.
- For nightshift- The shift cannot exceed 8 hours within a 24-hour time period and the pay rate is 110% of the regular wages.
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