Czech Republic: Operating a Business

Legal Forms of Companies

Společnost s ručením omezeným or SRO (Limited Liability Company): Number of partners: No minimum.
Maximum: 50.
Capital (max/min): CZK 1
Shareholders and liability: Partners' liability is limited to the amount contributed.
Akciová společnost or AS (Public Limited Company): Number of partners: No minimum: one or more; can be a sole proprietorship.
Capital (max/min): Minimum CZK 2 million when established without public bid and at least 20% must be released before the constituting general meeting. Minimum CZK 20 million with public bid.
Shareholders and liability: Liability is limited to the amount contributed.
Veřejná bchodní společnost or VOS (General Partnership): Number of partners: At least 2 natural partners.
Capital (max/min): No minimum capital requirement.
Shareholders and liability: Liability is unlimited for all partners.
Limited Partnership (KS): Number of partners: At least 2 partners: 1 active partner and 1 sleeping partner.
Capital (max/min): No minimum capital but the input of the partner with limited liability must be at least CZK 5,000.
Shareholders and liability: Liability of active partners is unlimited. Liability of sleeping partners is limited to the amount contributed.

Setting Up a Company	Czech Republic	Eastern Europe & Central Asia
Procedures (number)	9.00	5.26
Time (days)	24.50	11.78

Source: The World Bank - Doing Business, Latest data available.

The Competent Organisation: Ministry of Industry and Trade

Czech Trade Inspection Authority
For Further Information: Consult Doing Business Website, to know about procedures to start a Business in Czech Republic.

Dun & Bradstreet - Worldwide directory with financial information on businesses

Justice.cz - Public register of companies

Principle: Basic principle of recovery is equal conditions for all creditors (par conditio creditorum). For a bankruptcy, there are three basic conditions: decay, many creditors and enough assets for covering the costs of bankruptcy procedure. More information is available in the Act. No182/2006 Coll.
There is also the 2007 Bankruptcy law, which addressed important structural impediments such as the slow and uneven performance of the courts, weakness of the legal standing of creditors, and the lack of provisions for corporate restructuring.
Minimum Debt-to-Capital Ratio Triggering Liquidation: Not specified.
Bankruptcy Laws: Act. No 182/2006 Coll.
Reorganization and Rehabilitation Laws: Act. No 182/2006 Coll.

	2018	2019	2020
Labour Force	5,452,943	5,441,332	5,378,192

Working Rest Day: Saturday, Sunday
Paid Annual Vacation: After 3 month of testing period workers have the right for vacation in duration of one-twelfth each worked month. The minimum annual holiday is four weeks (20 working days)
Retirement Age: 65 years.
Child Labour and Minimum Age For Employment: 15 years are minimum age for employment of young people, but they may not work overtime and do night shifts.

Minimum Wage: The statutory monthly minimum wage is CZK 22,400 (approx. EUR 920.95 - CZK 134.40 per hour), as set by the Ministry of Labour and Social Affairs through an automatic indexation mechanism in the Labour Code.
Average Wage: As of May 2024, the average salary in the Czech Republic in euros was €1,600 per month.
Other Forms of Pay
Pay For Overtime: 25% over the basic rate
Pay For Rest Days Worked: 10% for overtime work completed on weekends or on days not stipulated in the original employment contract.
Pay For Night Hours: 10% for overtime work completed between 10 pm and 6 am
Pay For Overtime at Night: 25% over the basic rate for overtime work.

The Areas Covered: Both companies and employees are required to contribute payments to social security, including to health insurance, pension, unemployment insurance, sickness insurance and other benefits.
Contributions: Contributions Paid By the Employer: Employers contribute 33.8% of the employee's gross salary to the state health and social security funds (9% to the state health insurance funds and 24.8% the state social security funds).
Contributions Paid By the Employee: Health insurance 4.5%, old-age and invalidity pension between 3.5% and 6.5%.
Competent Organization: VZP - Health Insurance Company
VZP for Foreigners - Health Insurance Company

Recruitment Agencies: There are only private recruiting agencies. Most important are: Grafton, Robert Half, ManPower, Synergie.
Recruitment Websites: Jobs
Prace
CareerJET.cz

Type of Contract: Legal clauses regulate employment contracts and to a lesser degree collective agreements and individual negotiations.
The terms of employment contracts are extremely rigid and the limits for dismissal are less strict.

Labour Laws: Consult Doing Business Website, to obtain a summary of the labour regulations that apply to local entreprises.

Legal Framework: Labor Code (act. No.262/2006 Coll.), collective agreements, arbitration awards or court decisions

Social Dialogue and Involvement of Social Partners: The Czech Republic operates on the principle of free establishment and competition of unions. Establishment of a union is not mandatory in companies. The minimum number of employees needed to establish a company union is three.
Amongst them, the most powerful is Czech-Moravian Confederation of Trade Unions (so called CMKOS). It is an important social partner in tripartite negotiations in the framework of the Council of Economic and Social Agreement of the Czech Republic. It works in the regions of the Czech Republic through Regional Councils of Trade Unions (RROS) and Regional Offices for Legal Assistance (RPP). There are 33 trade unions in the framework of CMKOS.
Unionisation Rate: 11% of all employees.
Labour Unions: Other Unions affiliated to CMKOS
Regulation Bodies: Confederation of Industry of the Czech Republic (SPCR)

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