Significant changes are expected to the Labor Code
The Chamber of Deputies is discussing an amendment to the Labor Code in the spring of 2024, concerning trade unions, extraordinary and guaranteed wages. Another amendment aimed at increasing labor market flexibility will be approved by the government in the spring. There is also a third amendment on the horizon regarding transparency in remuneration.
As the end of the electoral term approaches, the government and legislators have accelerated the work on amending legal regulations, including labor law.
The first expected approval is an amendment to the Labor Code, which will transpose the directive on adequate minimum wages into Czech law. This amendment addresses situations where more than one trade union operates at an employer, introduces valorization of the minimum wage, and abolishes the guaranteed wage in the private sector. Employers will also be pleased by the abolition of the obligation to have a written holiday schedule.
The process of preparing the so-called flexible amendment to the Labor Code is developing slightly slower. In connection with it, there is a discussion about introducing an employer’s right to terminate employment without stating a reason. Even if this change is not adopted, other innovations are expected that will facilitate the process of dismissing employees. The rules for probationary periods and concurrent contracts could also change. Employees, moreover, will gain the option of self-scheduling work hours.
By 2026, the Czech Republic must also transpose the directive on transparency in remuneration. From this directive, employers will be required, for example, to include wages in advertisements or prohibit asking employees about their income in previous employment. Large employers will need to send regular reports to the state, containing statistical data on the remuneration of women and men according to different categories of workers. The Ministry of Labor and Social Affairs is already working on the text of the third amendment.
The approval of the first two amendments is more or less certain, and by the end of summer, we will also have a clear idea of their content. Transparency in remuneration is not yet imminent, but employers must expect that they will need more time to prepare for the new obligations.